Legislature(2001 - 2002)
04/02/2002 04:14 PM Senate FIN
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
April 02, 2002
4:14 PM
TAPES
SFC-02 # 45, Side A
SFC 02 # 45, Side B
SFC 02 # 46, Side A
CALL TO ORDER
Co-Chair Pete Kelly convened the meeting at approximately 4:14 PM.
PRESENT
Senator Dave Donley, Co-Chair
Senator Pete Kelly, Co-Chair
Senator Jerry Ward, Vice Chair
Senator Lyda Green
Senator Gary Wilken
Senator Lyman Hoffman
Senator Donald Olson
Senator Alan Austerman
Senator Loren Leman
Also Attending: SENATOR BEN STEVENS; CANDACE BROWER, Program
Coordinator, Office of the Commissioner, Department of Corrections;
JANE WINEGAR, Staff to Senator Lyda Green; GORDY WILLIAMS,
Legislative Liaison, Office of the Commissioner, Department of Fish
and Game; ROBERT BUTTCANE, Legislative & Administrative Liaison and
Juvenile Probation Officer, Division of Juvenile Justice,
Department of Health and Social Services; MARY JACKSON, Staff to
Senator John Torgerson; JEFF OTTESEN, Statewide Planning Chief,
Division of Statewide Planning, Department of Transportation and
Public Facilities; KRISTY TIBBLES, Staff to Senator Ben Stevens
Attending via Teleconference: From Anchorage: BRUCE RICHARDS,
Special Assistant, Office of the Commissioner, Department of
Corrections; TIM ROGERS, Legislative Program Coordinator,
Municipality of Anchorage; From Offnet Sites: WILLIAM GILBODI,
President, Gragil Associates, Inc.; LINDA WILSON, Deputy Director,
Public Defender Agency, Department of Administration
SUMMARY INFORMATION
SB 223-PRISONERS: PAROLE/GOOD TIME
The Committee heard testimony from the Department of Corrections,
adopted a new fiscal note, and reported the bill from Committee.
SB 97-PROBATION AND PAROLE FEES
The Committee heard testimony from the sponsor, the Department of
Administration, and a private accounts receivable company. A
committee substitute was adopted, and the bill reported from
Committee.
SB 205-CONTROL OF NUISANCE WILD ANIMALS
The Committee heard testimony from the sponsor and the Department
of Fish and Game. The bill reported from Committee.
SB 59-FEDERAL FUNDS TO MUNICIPALITIES FOR ROADS
The Committee heard testimony from the Department of Transportation
and Public Facilities and the Municipality of Anchorage. Two
amendments and an amendment to an amendment were considered with
one amendment being adopted. The bill reported from Committee.
SB 282-ALASKA SEAFOOD MARKETING INSTITUTE/TAX
The Committee heard from the sponsor, considered and adopted one
amendment, and reported the bill from Committee.
[NOTE: Portions of this meeting are difficult to hear due to a
malfunction in the sound system.]
CS FOR SPONSOR SUBSTITUTE FOR SENATE BILL NO. 223(JUD)
"An Act limiting the award of good time and restricting
release on mandatory parole for prisoners serving certain
sentences who fail to attain certain minimum educational
standards; providing that prisoners having attained or
attaining those educational standards receive good time awards
and availability of release on mandatory parole of one-third
of the term or terms of imprisonment rounded off to the
nearest day; and providing for an effective date."
This was the second hearing for this bill in the Senate Finance
Committee.
Co-Chair Donley informed the Committee that the Department of
Corrections' new fiscal note, dated March 22, 2002, reflects the
potential savings and costs associated with this legislation. He
stated that the fiscal note's "extensive" fiscal analysis is based
on the State's best estimate of the average cost of housing inmates
combined with data gathered from similar programs operating in
other states. He voiced support "for this conservative" fiscal
analysis, and expressed that implementation of the General
Education Development (GED) program could produce savings extending
beyond the amounts specified in the note, as research indicates
that released inmates who have earned their GED commit less crime
than those who have not. He stressed that a reduction in the rate
of recidivism would produce significant savings to the citizens of
the State, and he opined that additional savings would be incurred
by the "multiplier effect" whereby inmates who refuse to earn their
GED would not be granted the full early release as specified in
State statute; and therefore would not be "back out on the streets"
committing further criminal activity.
Co-Chair Donley offered a motion to adopt the Department of
Corrections $60,300 fiscal note, dated March 22, 2002.
Co-Chair Kelly objected for fiscal note clarification.
Co-Chair Donley identified the fiscal note for the Committee.
Co-Chair Kelly withdrew the objection.
Senator Hoffman stated that this bill specifies that the full "good
time" early release sentence reduction would be applicable to
inmates who earn their GED; however, he asked whether additional
expenses would be incurred by housing inmates, who refuse or fail
to earn their GED, for longer periods of time.
Co-Chair Donley stated that analysis included within the original
Executive branch fiscal note provides that information.
Senator Hoffman asked the specifics of the original fiscal note.
Co-Chair Donley explained that the fiscal note calculates that
approximately 35 percent, or 70 inmates, of the 200 inmates
incarcerated each year would possess a high school diploma;
therefore, approximately 130 inmates would be subject to the GED
requirement. He elaborated that the analysis estimates that
approximately eight percent, or ten inmates, of the 130 would be
incapable of achieving their GED, and therefore, would be exempt
from the requirement. He furthered that another nine inmates would
be excluded from the requirement because they do not speak English;
therefore, he concluded, 111 inmates would be subject to the
requirement on an annual basis.
Co-Chair Donley furthered that expenses associated with the program
would include: providing for tutors; conducting assessments of
incoming inmates; and determining the costs associated with
expanding the program to allow other inmates to earn their GED. He
stated that, annually, approximately sixteen of the 200 inmates
would fail or refuse to earn the GED. He detailed that the new
fiscal note incorporates the program expenses with the expected
program savings to produce, initially, a net increase of $60,000 a
year. He stated that these projections include the costs associated
with housing inmates who do not qualify for early release; however,
he reiterated, this increase might be offset by a reduction in
crime.
Senator Hoffman specified that, initially, the program would incur
additional annual costs of $60,300; however, the amount would
increase to approximately $107,000 in subsequent years.
Co-Chair Donley concurred. He reminded the Committee that the
number of recidivism cases is an average of the data garnered from
the states of Florida and Alabama that have similar programs.
Co-Chair Kelly summarized that the net amount of the fiscal note is
based on cost estimations from the Department of Corrections and
information from the two identified states.
Senator Olson asked whether data is available from other states.
Co-Chair Donley responded that these are the only states that could
supply critical data regarding the success rate of the GED program.
Without objection, the fiscal note from the Department of
Corrections was ADOPTED.
CANDACE BROWER, Program Coordinator and Legislative Liaison, Office
of the Commissioner, Department of Corrections informed the
Committee that 147 State inmates voluntarily earned their GED in
2001, which, she expressed, attests that the Department already
encourages inmates to continue their education. She argued that the
State's recently revised GED test is "normed" against high school
graduates, and the fact that 30 percent of those high school
graduates failed the exam, is cause for concern as, she countered,
this might place inmates at a disadvantage.
Ms. Brower expressed that although the GED requirement is optional,
but encouraged, in Florida, earning the GED is mandatory in order
for the inmate to qualify for the Florida's "good time" sentence
reduction. She asserted that monitoring the requirements of this
legislation would place additional burdens on the Department's
resources.
BRUCE RICHARDS, Special Assistant, Office of the Commissioner
Department of Corrections, testified via teleconference from
Anchorage to voice that Alaska's prison population is "at an all-
time high" and is continuing to grow. He stressed that basing the
fiscal note's recidivism rate on the statistics of Florida and
Alabama might not be the best methodology to use in calculating the
amount of money that would be required to pay for housing inmates
who fail to earn their GED.
Senator Hoffman asked how the State is addressing the rising prison
population situation. He noted that, while this bill encourages
inmates to further their education in order to qualify for more
jobs, the bill could also harm the prison population situation by
mandating longer periods of incarceration for inmates who fail to
earn their GED.
Mr. Richards affirmed that Alaska is one of five or six states with
an increasing prison population, and he noted that although Alaskan
inmates historically serve 66 percent of their sentenced time
compared to 85 percent of the sentenced time in other states,
Alaskan inmates stay in prison longer because of the State's
"stiffer sentencing." He stated he could not provide a solution to
the situation.
Co-Chair Donley commented that recent United States Department of
Justice statistics indicate that Alaska's rate of incarceration is
below the national average; therefore, he stated, "even if we had
an increase, we're still right in the middle compared to other
states as far as the rate of population being incarcerated." He
acknowledged; however, that this information does not address the
Department's growing prison population concern.
Senator Hoffman commented that Alaska Natives comprise a large
segment of the State's prison population, and consequently, he
surmised that of those incarcerated, "that a higher percentage of
Alaska Natives are going to be the ones that do not have" a high
school degree.
Mr. Richards replied that Alaska Natives comprise 37 percent of the
total prison population, and he noted that some of them "have the
added difficulty" of such things as English as a second language.
However, he noted, the bill contains a provision addressing this
concern.
Senator Hoffman argued that this provision is applicable to
individuals who do not speak English; however, excludes those for
whom English is a second language.
Co-Chair Donley clarified that Section 2(A)(iii) of the bill
specifies that individuals for whom English is not their primary
language are exempt from the GED requirement.
Senator Hoffman stated that this language addresses his concern.
Ms. Brower reiterated that the growth of the prison population
presents a problem to the Department because the State continues to
enact laws that perpetuate the population by increasing
incarceration sentences. She expressed that insufficient funding
prevents the Department from adequately addressing the increase in
inmate population, which she contended is reaching "critical mass."
Ms. Brower contended that, while "education is a serious component
in the rate of recidivism," the State must address the serious drug
and alcohol problem that acts as a counter-measure to the benefits
derived from an education.
Co-Chair Kelly interjected that while there are a multitude of
issues that this bill does not address, enactment of this
legislation would not harm the situation.
Senator Ward asked the number of inmates in the State's prison
system.
Mr. Richards responded that the State's current prison population
consists of approximately 4,900 people.
Senator Ward remarked that the State spends more money to address
the educational needs of small northern rural areas, with minimal
results from its investments, than it spends for education in the
Kenai Peninsula. He stated that these poor results are not
necessarily the government's fault as, he asserted, responsibility
starts with parents. He opined that if students do not receive a
"proper education," many would end up in prison.
Senator Ward contended that this bill "is a good step" in providing
individuals with a tool to start taking responsibility for their
own actions, and that a reduction in the rate of recidivism would
result in substantial savings for the State. He voiced that
providing incarcerated individuals with the ability to achieve a
level of higher education would provide them with an opportunity to
become responsible citizens and stay out of jail. He stressed that
"the common thread between every inmate" is that they want to get
out of jail, and they would do whatever is necessary, including
earning their GED, to accomplish that goal. He summarized that
"this is a very good bill."
Co-Chair Donley moved to report the "CS for Sponsor Substitute for
SB 223, Judiciary, with accompanying adopted Senate Finance fiscal
note from Committee with individual recommendations."
Senator Hoffman objected, and stated that this bill's reversal of
the current "good time" sentence reduction combined with the
requirement that inmates earn their GED appears to be "a
punishment." He continued that many people might not be able to
earn their GED and this would cause them "to be more frustrated and
possibly feel more inferior as they are left behind," and he
questioned how this would affect this person when he is "back out
on the street." He stated that while this bill might be "well
intentioned, it's going the wrong direction," and, he stressed that
the focus should be placed on enabling the State's education system
to provide the means "along the way, without the loss of the 'good
time' sentence reduction."
Co-Chair Donley commented that these concerns are addressed in the
newly adopted fiscal note as it includes funding to assess inmate's
circumstances. He argued that provisions within the legislation
would allow the Department's Commissioner to exempt individuals
from the bill's educational requirements, and he asserted that the
bill provides safeguards to protect individuals who demonstrate
effort, but who are unable to earn their GED as well as those
individuals who simply do not have the physical or mental ability
to achieve their GED.
Senator Hoffman spoke to the Department of Correction's analysis
that the prison population is at critical mass. He stated that he
would "be more comfortable" with this legislation if an increase in
prison facilities and a reduction in the ratio of correction staff
to criminals were being actively pursued by the State.
Senator Ward agreed that the overcrowding situation in the State's
prisons must be addressed; however, he stressed that education is
the tool to keeping people out of prisons. He reiterated that
inmates would exert effort to earn their GED if it enabled them to
get out of prison, and that society, in general, would be
supportive of this endeavor. He reiterated that the Commissioner
would have the authority to exempt individuals from the
requirements, and he stressed that this legislation would produce
positive results.
Co-Chair Donley remarked that it would be a minimum of three years
before any "potential, possible" increase in the prison population
would occur as a result of the enactment of this bill. He furthered
that there is sufficient time for the Legislature and the Executive
Branch to continue efforts to provide for additional correctional
facilities.
Senator Olson asked the percentage of inmates who suffer from
learning disabilities caused by such things as Fetal Alcohol
Syndrome.
Co-Chair Donley stated that the fiscal note identifies
approximately 18 percent of the prison population as having these
types of learning disabilities. He reiterated that these
individuals would be exempt from the educational requirements.
Senator Olson asked how many of the 147 individuals who voluntarily
earned their GED were Alaska Natives.
Ms. Brower responded that this information would be provided to the
Committee.
A roll call was taken on the motion.
IN FAVOR: Senator Green, Senator Leman, Senator Olson, Senator
Ward, Senator Wilken, Senator Austerman, Co-Chair Donley, Co-Chair
Kelly
OPPOSED: Senator Hoffman
The motion PASSED (8-1)
CS for SS SB 223 (JUD) was REPORTED from Committee with a new
$60,300 fiscal note, dated March 22, 2002 from the Department of
Corrections.
SENATE BILL NO. 97
"An Act relating to fees for probation and parole."
This was the second hearing for this bill in the Senate Finance
Committee.
Senator Ward, the bill's sponsor, explained that this legislation
was initially heard by the Committee during the first session of
the Twenty-Second Legislature; however, he stated, the bill was
held in Committee in order to determine how many states charge fees
to individuals on probation or parole; to determine fee collection
methods; and to determine the cost of administering the program.
Senator Ward informed the Committee that Alaska is the lone state
not charging probation and parole fees, and he commented that the
proposed committee substitute contains a provision that would allow
the State to contract with a private business to manage the fee
collection process.
WILLIAM GILBODI, President, Gragil Associates, Inc. testified from
an offnet site and informed the Committee that the company, which
is an accounts-receivable management firm located in Rockland,
Massachusetts, has been managing the billing and collecting of fees
for the state of Vermont, Department of Corrections, since 1997. He
explained that the company's contract with Vermont provides for
such things as: supervision fees; victim assistance and
compensation; victim restitution; transportation; and general fund
fines. He stated that the contract includes a 13.3 percent
contingency fee that is charged to the individuals on probation
rather than to the state. He explained that the contingency fee is
added to the monthly fees of the probationer, and if the monthly
fee is paid within 30 days of receipt, the contingency fee is
waived. He stated that the actual fee cost to probationers averages
approximately nine percent.
Senator Ward asked the testifier to explain the process whereby the
company is authorized to attach probationers' tax refunds for non-
payment of fees.
Mr. Gilbodi informed the Committee that this is the first year that
authorization was granted to attach probationer's tax refunds, and
he attested the process has been successful.
Senator Ward avowed that, were this legislation enacted, the
State's delinquent balances could be collected through attaching
probationers' Permanent Fund Dividends.
Senator Ward asked the testifier whether the collection process is
working well in the state of Vermont.
Mr. Gilbodi informed the Committee that Vermont's 2001 recovery
rate was 70 percent, and he reported that the recovery rate should
increase as a result of the authorization to attach Income Tax
Refunds for delinquent balances. He furthered that the company has
recently implemented a credit bureau reporting system that should
provide additional recovery rate increases.
Senator Ward informed the Committee that the Alaska Department of
Corrections has a current successful collection rate of ten
percent.
Co-Chair Donley reminded the Committee that representatives of the
Executive Branch recently testified to the Committee that the
State's collection rate is approximately 30 percent. He declared
that he considers this number to be "extremely low" as the
Department is authorized to attach individuals' Permanent Fund
Dividends. He asserted that the successful collection rate
demonstrated by the testifier's company affirms that the collection
rate should be higher, and he suggested that perhaps a private
institution rather than the Department of Corrections could provide
better collection management.
Senator Ward stated that the testifier's company, and others, would
submit proposals were this legislation enacted.
Co-Chair Kelly reminded the Committee that the Version "C"
committee substitute has not yet been adopted as a working draft.
SFC 02 # 45, Side B 05:02 PM
AT EASE 5:02 PM /5:06 PM
LINDA WILSON, Deputy Director, Public Defender Agency, Department
of Administration, testified from an offnet site to express that
the bill mandates the establishment of separate parole and
probation fees, and she stressed that this would require an
individual, on parole and probation at the same time, to incur
duplicate fees. She asked the Committee to address whether the
intent of the legislation is to collect dual fees, and she detailed
situations wherein a person could be simultaneously on parole and
probation, yet report to a single probation officer. She stressed
that the proposed language would result in duplication of efforts
that would negatively affect the Courts, the individual, and the
Parole Board. She urged the Committee to revise the language to
specify that a single fee would apply to individuals in this
situation.
Senator Ward stated that the bill currently contains mechanisms to
safeguard against the testifier's valid concern; however, the Court
could decide that dual fees were necessary. He added that some
states charge up to 26 different fees to individuals on probation
or parole, primarily, he continued, as a means to offset the cost
of providing parole and probationary programs.
AT EASE 5:10 PM / 5:17 PM
Co-Chair Kelly announced that this bill would be SET ASIDE and re-
addressed later in the meeting.
CS FOR SENATE BILL NO. 205(RES)
"An Act relating to control of nuisance wild animals; and
providing for an effective date."
JANE WINEGAR, Legislative Aide to Senator Lyda Green, explained to
the Committee that this bill authorizes the Alaska Board of Game to
adopt regulations allowing for the issuance of permits and licenses
to commercial and non-commercial entities to control nuisance small
birds and mammals. She explained that this legislation would allow
a homeowner who is having a problem with, for example, a porcupine,
to either personally remove the animal or hire a commercial entity
to remove it. She continued that the bill would also provide the
Department of Transportation and Public Facilities with the means
to remove such things as nuisance beavers from culverts during road
construction projects.
Senator Austerman asked whether this bill would provide protection
from seagulls that present problems around airports.
Ms. Winegar stated that endangerment from birds is addressed in
other statutes such as the Migratory Act.
GORDY WILLIAMS, Legislative Liaison, Office of the Commissioner,
Department of Fish and Game, explained that public safety
authorizations currently address situations pertaining to birds and
other wildlife at airports, as the issue is a public safety issue
rather than a nuisance issue.
Mr. Williams explained that the original version of the bill
authorized the Department of Fish and Game to issue permits to
commercial entities for dealing with nuisance animals and birds;
however, he clarified, the proposed committee substitute expands
the authorization to allow the issuance of permits to private, non-
commercial entities.
Senator Austerman asked for clarification regarding who authorizes
the permits.
Mr. Williams stated that Section 4 of the proposed committee
substitute specifies that the Commissioner of the Department of
Fish and Game could issue permits, without cost, to non-commercial
entities such as individuals or the State Department of
Transportation and Public Facilities.
Senator Austerman asked if the Department of Transportation and
Public Facilities currently applies for permits to handle the issue
of bird control at airports.
Mr. Williams responded that this is correct; however, he reiterated
that bird control at airports is considered to be a matter of
public safety rather than nuisance control. He continued that this
procedure would also apply to public safety issues on the State's
road system.
Senator Hoffman surmised, therefore, that moose along the highway
is a public safety issue rather than a nuisance issue.
Senator Green stated that this bill was drafted in response to
constituents who had arranged to hire a local trapper to remove
nuisance animals from their property. She explained that, in the
process, it was determined that single permits must be acquired for
each incident. She stated that this legislation would allow an
individual to acquire the necessary permits for a "longer-term
basis." She detailed the requirements that would apply to entities
applying for a permit.
Senator Olson asked whether musk oxen are considered small mammals
as, he voiced concern that they oftentimes damage airport runway
lights in rural villages.
Mr. Williams responded that this situation is also considered a
public safety issue rather than a small mammal issue.
Senator Green moved to report "SB 205 from Committee with
individual recommendations and very, very minor fiscal note."
There being no objection, CS SB 205(RES) was REPORTED from
Committee with a new zero fiscal note, dated March 13, 2002 from
the Department of Fish and Game.
AT EASE 5:26 PM /5:31 PM
SENATE BILL NO. 97
"An Act relating to fees for probation and parole."
[This bill was heard earlier in the meeting.]
Senator Ward moved to adopt committee substitute Version "C" as a
working draft.
There being no objection, CS SB 97(FIN), Version 22-LS0338\C was
adopted as a working draft.
ROBERT BUTTCANE, Legislative & Administrative Liaison and Juvenile
Probation Officer, Division of Juvenile Justice, Department of
Health and Social Services, voiced that the Department is opposed
to probation fees that would affect individuals served by the
Department.
Ms. Wilson commented that the Version "C" committee substitute is
not available at the off-net site; however, she noted that Section
7 of Version "A" "indicates that the Parole Board shall revoke the
parole of a parolee who defaults on a payment." She asked the
Committee to consider an amendment to change the word "shall" to
"may" in order for the Parole Board to have an option in the
situation.
Senator Ward asserted his intent that the Parole Board should not
have the option of eliminating fees.
Ms. Wilson explained that if the Court has the ability to impose a
probation fee as specified in Section 6 of Version "A," then
provisions should be included to allow the Court the discretion to
revoke probation. She stated that Section 7 of Version "A" limits
this ability to the discretion of the Parole Board. She reiterated
that she does not have access to a copy of Version "C" and
apologizes if she is reading outdated language.
Co-Chair Kelly stated that Section 4(a) of Version "C" contains
language that states, "A Court granting probation, as defined in AS
33.05.080, shall require a periodic probation fee to be paid to the
Department of Corrections as a condition of probation based on
ability to pay." He surmised that this language allows the Court to
regulate whether it would be appropriate to "double up" on the
fines of the parolee.
Ms. Wilson agreed, but clarified that the bill contains two
different provisions: one that concerns probation and another that
concerns parole. She stressed that "the Court does not get involved
in parole, and Section 7 refers to the Parole Board."
Senator Ward moved to report the "Committee Substitute for Senate
Bill Number 97, Version 'C' out of Committee with individual
recommendations and accompanying note."
Senator Hoffman objected, and asked whether the adoption of Version
"C" would have any affect on the accompanying fiscal notes.
Senator Ward responded that while he does not agree with the
accompanying fiscal notes, they are applicable to Version "C."
A roll call was taken on the motion.
IN FAVOR: Senator Leman, Senator Ward, Senator Wilken, Senator
Austerman, Senator Green, Co-Chair Donley, Co-Chair Kelly
OPPOSED: Senator Hoffman, Senator Olson
The motion to report the bill from Committee PASSED (7-2)
CS SB 97(FIN) was REPORTED from Committee with a Department of
Health and Social Services fiscal note in the amount of $214,400
dated February 22, 2002, a Department of Corrections fiscal note,
dated March 1, 2002 in the amount of $16,600, and a Department of
Administration zero fiscal note dated April 1, 2002.
CS FOR SENATE BILL NO. 59(CRA)
"An Act relating to awards of federal funds to municipalities
for road projects; and providing for an effective date."
This was the second hearing for this bill in the Senate Finance
Committee.
MARY JACKSON, Staff to Senator John Torgerson, the bill's sponsor,
informed the Committee that this bill would establish a new program
that would direct approximately $20 million in non-National Highway
System (NHS) federal transportation funds annually to
municipalities rather than to State agencies. She continued that
the proposal specifies an annual limit of $3 million be allotted
per municipality; that the recipient municipality must possess the
power and authority to use the funds to construct roads; and that
the municipality must provide matching funds as detailed in the
bill's fiscal note. She explained that the focus of the bill is to
provide municipalities with the ability to expedite road
construction projects within their boundaries, and furthermore, she
stressed, the State would save approximately $1.5 million in
general funds because the municipality, rather than the State,
would provide the required matching funds.
TIM ROGERS, Legislative Program Coordinator, Municipality of
Anchorage, testified via teleconference from Anchorage to voice
support for this legislation as it would enable the City to
undertake ownership of seven identified road projects. He noted
that only one of these projects is under the current program
threshold of $350,000 and that the average project ranges between
$4 million and $5 million with a total cost for all seven projects
being $30 million. He urged the Committee to consider elevating the
threshold level to allow Anchorage the ability to assume
responsibility for these road projects.
JEFF OTTESEN, Statewide Planning Chief, Division of Statewide
Planning, Department of Transportation and Public Facilities
asserted that current practice allows funding to be appropriated to
local governments through the Statewide Transportation Improvement
Program (STIP) that annually provides approximately $75 million to
local road projects.
Mr. Ottesen continued that while the alternate funding process
proposed in this bill would allow local governments to execute road
projects and administer funds on a local level, he contended that
the technicalities of the federal aid process are extremely
complex. He declared that Department "staff have spent their entire
careers learning how to work within those rules, they undergo
constant training and re-training to stay abreast of the changes in
those rules. It is not a trivial body of knowledge they that have
to work within and to assume that local officials, already immersed
in their day-to-day routines and responsibilities of local
government, can automatically just step in and learn all this is
our worry." He showed the Committee a large manual that contains
overviews of the federal program, and he stated that a multitude of
similar manuals would be required reading.
Mr. Ottesen stressed that this federal aid is a reimbursement
program rather than a grant program as incorrectly perceived by
many people. He expressed that communities would be required to
"float the cash" for a project in adherence to federal rules and
regulations, and then request reimbursement for the expenditures.
He asserted that, if the project were determined to be non-
compliant with the federal regulations, the money would not be
forthcoming. He reiterated the difficulties associated with the
process.
Mr. Ottesen informed the Committee that, in addition to receiving
regular STIP funding, some communities, including Anchorage,
receive additional STIP funding that is available to support
administrative expenses.
Mr. Ottesen stressed that, were this legislation enacted, the local
community projects would continually require State involvement. He
stressed that in a situation where a local project fails to comply
with federal rules and "gets into financial trouble," the State
would be required "to bail them out" because the State is
"obligated under the relationship with the Federal Highways
Administration (FHA) to take that responsibility."
Mr. Ottesen furthered that because the Department is ultimately
responsible for this funding, the "management of these projects
would require a high level of oversight by DOT staff." He detailed
the multitude of procedures and documentation mandated by the FHA
that the communities would be required to perform in order to
receive the federal aid. He stated, "that the technical realities
of the legislation are sobering."
Mr. Ottesen pointed out that, although it is separate federal
st
legislation, the Transportation Equity Act for the 21 Century
(TEA-21), identified many transportation projects for communities
in the State; however because of the complexity of the federal
guidelines, the risks that would be assumed, and the multitude of
procedural requirements, only one has been pursued by local
governments. He commented that the federal requirements of this
legislation would be similar.
Co-Chair Kelly asked the Municipality of Anchorage representative
to respond to the Department's position that the technicalities of
this endeavor are too much for a local government to undertake.
Mr. Rogers informed the Committee that the program proposed by this
legislation is optional rather than mandatory, and he reiterated
that this legislation would provide communities with the ability to
further their priority road projects. He countered that the
Municipality of Anchorage does not perceive the federal regulations
and requirements to be an issue, and he attested that Anchorage and
other municipalities in the State are capable of handling the
projects independently from the State.
Amendment #2: This amendment raises the maximum amount of federal
highway funds awarded to a single municipality from $3 million to
$7 million per year.
Co-Chair Donley moved for adoption of Amendment #2.
Senator Austerman objected. He voiced concern that raising the
award level might be beneficial to large communities such as
Anchorage that have big projects; however, because the funds are
limited, raising the level would reduce the funding amount
available for other communities' projects.
Senator Green voiced that, to address Senator Austerman's concern,
the Committee should consider increasing the total amount of
available funding.
Ms. Jackson verified that federal funds could be available to
provide for an elevated level.
Senator Green asserted that increasing the total amount of funding
awarded would be beneficial because there are multiple levels of
funding needs in the State.
Senator Green moved to amendment the amendment to increase the
total amount awarded in a fiscal year from $20 million to $40
million, and increases the maximum amount of federal highway funds
awarded to a single municipality to $6 million per year.
Co-Chair Kelly objected then removed his objection.
Senator Hoffman asked the sponsor's representative to comment on
what he (Senator Hoffman) characterized as "double-dipping;"
whereby some municipalities, such as Anchorage with its AMATS
Anchorage Metropolitan Area Transportation Study (AMATS) program,
receive transportation funding from multiple sources.
Ms. Jackson responded that she "heard that and noted it, and
frankly I was a little surprised to hear it because the Department
would have the authority to establish the regulations for the
program" to ensure against such double-dipping.
Senator Hoffman asked whether this "would be the intent of the
sponsor."
Ms. Jackson replied, "Certainly."
A roll call was taken on the motion to amend the amendment.
IN FAVOR: Senator Ward, Senator Green
OPPOSED: Senator Wilken, Senator Austerman, Senator Hoffman,
Senator Leman, Senator Olson, Co-Chair Donley, Co-Chair Kelly
The motion FAILED (7-2)
The amendment FAILED to be amended.
Co-Chair Kelly announced that Amendment #2 is before the Committee.
Co-Chair Donley avowed that the AMATS program that was incorporated
under the Municipal Planning Organizations (MPOs) program initiated
by TEA-21 "has been a curse" to Anchorage and other nation-wide
metropolitan areas nationwide that have populations exceeding
200,000, because completion of the various components required by
the study, particularly the major investment study, is tedious. He
stated that because of AMATS, the federal STIP program has
"intentionally discriminated" against Anchorage for many years and
has resulted in less funding being provided to the City because
roads could not be constructed without a completed study.
Co-Chair Donley stated that because most of the projects in
Anchorage exceed $7 million, this amendment would allow Anchorage
to participate in receiving some of the funding proposed in this
legislation. He contended that with 42 percent of the State's
population, Anchorage would be entitled to $8.4 million if the
distribution of funds were determined on a per capita basis. He
asserted that the Municipality of Anchorage expends "more per
capita for road maintenance than any other community in the State."
He argued that to limit the allotment per community to $3 million
would be "really unfair to the people of the Anchorage community,"
as it makes it difficult for the community to access the money.
Senator Wilken reminded the Committee that in previous hearings, a
$10 million maximum per community was discussed, and he asked the
witness how the sponsor views that level of funding.
Ms. Jackson advised that Senator Torgerson would not support an
amendment that would substantially increase the funding level. She
contended that numerous communities in the State might have
projects in the $7 million range; however, she stressed, the goal
is to distribute the money around the State. She stated that, "the
practical application would be to break a project into components"
to fit within the specified levels of the bill.
A roll call was taken on the motion.
IN FAVOR: Senator Leman, Senator Ward, Co-Chair Donley, Co-Chair
Kelly
OPPOSED: Senator Wilken, Senator Austerman, Senator Green, Senator
Hoffman, Senator Olson
The motion FAILED (4-5)
Amendment #2 FAILED to be adopted.
Amendment #3: This amendment changes the bill's effective date to
July 1, 2002.
Senator Leman moved for adoption of Amendment #3.
Without objection, Amendment #3 was ADOPTED.
Senator Ward made a motion to report "committee substitute for
Senate Bill Number 59 out of committee with individual
recommendations, as amended, and accompanying notes."
Co-Chair Donley objected. He stated that this bill "perpetuates a
decade of unfair, unreasonable discrimination against the road
needs of the Anchorage Bowl, and that the rest of the State has
benefited by the shortchanging of the Anchorage community through
the STIP and the unreasonable redistribution of that money to the
rest of the State, with promise after promise that eventually the
money would be coming to our community to deal with the problems
that we have with just basic traffic." He continued that the State
receives most of its revenue from motor fuel taxes and licensing
fees from Anchorage's residents, who comprise 42 percent of the
State's population, and he contended that Anchorage residents are
entitled to some funding. He stated that the criteria for this
distribution is biased against any urban area and has resulted in
"severe discrimination" against the Anchorage community.
Senator Hoffman also objected. He stated that although this bill
might be well-intentioned, the problems that communities would have
in adhering to the federal regulations and guidelines, as
identified by the Department of Transportation and Public
Facilities, would prevent the majority of small rural areas from
accessing this funding because they do not have the necessary
expertise or capability to participate in this program.
A roll call was taken on the motion.
IN FAVOR: Senator Green, Senator Austerman, Senator Olson, Senator
Wilken, Senator Ward, Senator Leman, Co-Chair Kelly
OPPOSED: Co-Chair Donley, Senator Hoffman
The motion PASSED (7-2)
CS SB 59(FIN) was REPORTED from Committee with a new Department of
Transportation and Public Facilities zero fiscal note, dated April
23, 2002.
At EASE 6:02 PM / 6:05 PM
CS FOR SENATE BILL NO. 282(L&C)
"An Act extending the termination dates of certain activities
and salmon marketing programs of the Alaska Seafood Marketing
Institute and of the salmon marketing tax; expanding the
allowable use of that tax for the salmon marketing programs of
the Alaska Seafood Marketing Institute; relating to the Alaska
Seafood Marketing Institute's salmon marketing committee; and
providing for an effective date."
This was the second hearing for this bill in the Senate Finance
Committee.
KRISTY TIBBLES, staff to Senator Ben Stevens, the bill's sponsor,
noted that she is available to answer questions pertaining to the
bill.
AT EASE 6:07 PM / 6:13 PM
Amendment #1: This amendment changes the title of the bill to read
as follows.
An Act delaying the repeal of the salmon marketing tax;
expanding the allowable use of that tax for the salmon
marketing programs of the Alaska Seafood Marketing Institute;
relating to the Alaska Seafood Marketing Institute's salmon
marketing committee; and providing for an effective date.
This amendment additionally deletes Section 4 of the bill that
pertains to clarifications regarding the uncodified law of the
State.
Senator Austerman moved for adoption of Amendment #1.
SENATOR BEN STEVENS stated that the removal of Section 4 eliminates
confusion in the bill regarding the re-authorization of the one
percent domestic salmon marketing tax that is required to be
reinstated every five years.
Without objection, Amendment #1 was ADOPTED.
Senator Austerman moved to report the "CS for Senate Bill 282, as
amended, with accompanying fiscal note with individual
recommendations out of Committee."
Without objection, CS SB 282(FIN) was REPORTED from Committee with
a $1,800,000 fiscal note, dated March 1, 2002 from the Department
of Community and Economic Development.
SFC 02 # 46, Side A 06:15 PM
AT EASE 6:15 PM / 6:16 PM
adjournment
Co-Chair Pete Kelly adjourned the meeting at 06:17 PM
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