Legislature(2007 - 2008)FAHRENKAMP 203
01/22/2008 01:00 PM Senate TRANSPORTATION
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| Aviation Overview | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
SENATE TRANSPORTATION STANDING COMMITTEE
January 22, 2008
1:05 p.m.
MEMBERS PRESENT
Senator Albert Kookesh, Chair
Senator Donald Olson
Senator Bill Wielechowski
Senator Gary Wilken
MEMBERS ABSENT
Senator John Cowdery, Vice Chair
COMMITTEE CALENDAR
Aviation Overview
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
FRANK RICHARDS, Deputy Commissioner
Department of Transportation and Public Facilitates (DOT)
Juneau AK
POSITION STATEMENT: Presented overview of rural aviation in
Alaska.
JESSE VANDERZANDEN, Manager
Fairbanks International Airport
Fairbanks, AK
POSITION STATEMENT: Presented an overview of Fairbanks
International Airport.
MORT PLUMB, Manager
Ted Stevens Anchorage International Airport
Anchorage, AK
POSITION STATEMENT: Presented an overview of Ted Stevens
Anchorage International Airport.
ACTION NARRATIVE
CHAIR ALBERT KOOKESH called the Senate Transportation Standing
Committee meeting to order at 1:05:11 PM. Present at the call to
order were Senators Wilken, Wielechowski, Olson, and Chair
Kookesh.
^AVIATION OVERVIEW
CHAIR KOOKESH announced the committee would hear an aviation
overview.
FRANK RICHARDS, Deputy Commissioner, Department of
Transportation and Public Facilitates (DOT), introduced the
managers of the Anchorage and Fairbanks airports respectively,
Mort Plumb, Jesse Vanderzanden, and legislative liaison, Mary
Siroky.
JESSE VANDERZANDEN, Manager, Fairbanks International Airport,
said he would address five things: capitol improvements program,
passengers, cargo, general business and aviation. The capitol
improvements over the past five years and projected into the
future were as follows: 2001-02, they extended and rebuilt a
runway to 6500 feet from an original of 4200 feet. De-icing pads
were completed in 2006 on the end of the taxiway -it allows then
to isolate their glycol and remediate it for less expense. In
the same year, Taxiway Alpha was rebuilt after 25 years of use.
The cargo apron was relocated south to a new area because of the
terminal expansion. Taxiway Alpha will be prepped to be the
alternative runway for 2009 for when the main runway is rebuilt.
The float pond and ski strip was expanded.
1:09:58 PM
MR. VANDERZANDEN said that from 2006-2009 the terminal will have
greater development. The old terminal was 143 thousand square
feet and the new terminal will measure 151 thousand square feet.
He said it's really a net gain if we consider it from the point
of view of efficiency. The terminal was approved by the airlines
and the legislature for $99 million. The current budget forecast
is $93.5 million. Completion is on track for 2009 and they're
currently ahead of schedule.
1:11:08 PM
SENATOR WILKEN joined the meeting.
MR. VANDERZANDEN pointed out which parts of the terminal were
open for business and which parts were under construction in
2007 and 2008. They expect the new terminal addition to open May
1 2008 in time for summer season. All of the mainline carriers
will operate out of this new terminal addition. The regional
carriers will operate out of the existing terminal. The middle
part will be demolished this summer. In spring 2009 the facility
will be completed except for demolition of the regional terminal
in winter 2008. An artist's rendering of the terminal was
displayed, front and landside views.
He said domestic passenger service has seen a steady growth for
the past 20 year averaging 2.3 to 2.9 percent. Delta Airlines
was new in 2004. They're planning on expanding from 5 days a
week to 7 days a week with weekend service. Alaska added an
additional Seattle route in 2007 and another Anchorage route.
ERA came into the terminal this fall with 3 flights daily to
Anchorage. The airport also has a small community air service
development grant that they're using to solicit additional
service to the Rocky Mountain States, primarily Denver.
MR. VANDERZANDEN said International Enplanements have taken off.
Japan Airlines (JAL) started with three winter charters in 2005
and has since expanded its schedule to 19 flights. He pointed
out on the slide how the passenger counts have grown
exponentially. The Condor/Thomas Cook direct flights to
Frankfurt, Germany started slowly but have become more popular.
1:15:21 PM
MR. VANDERZANDEN said that the cargo component hasn't worked as
well and is underutilized. Fairbanks International Airport is
the primary diversion for Ted Stevens Anchorage International
Airport. They have cargo transfer authority and they are 9.5
hours from 90 percent of the northern industrialized hemisphere.
He said the big hit to Fairbanks was the loss of Europe to
central Asia traffic. With the opening of the Soviet airspace,
it's a four hour savings one way for the airlines to go to
Tashkent, Uzbekistan rather than transiting through Fairbanks.
In 2006, the airport got Volga-Dneper Charters.
He explained that the airport funds its operations, absent rates
and fees from airlines, with concession and land revenue. There
has been significant growth in both over the last years. A
portion of this was created by an increase in fees, but the
majority increase came from additional lease lots. The increase
in concession revenue came primarily from passengers.
Fairbanks International Airport is the largest general aviation
airport north of the Alaska Range. It has one paved runway and
one gravel runway. The float pond has 185 spaces and 365 tie-
down spaces. There's a pilot's lounge and an airpark that's very
popular in the summer, but it's not open in the winter.
1:18:01 PM
SENATOR OLSON asked if there was a need to increase the number
of float slips and if there's a waiting list.
MR. VANDERZANDEN replied currently there's not a waiting list.
The increase in slips is a by-product of expanding the general
aviation runway.
SENATOR OLSON asked how they have dealt with people who were on
the waiting list for 10 to 12 years.
MR. VANDERZANDEN explained that opening up the new float pond
gave the airport 43 new spaces. They currently have 14 vacant
slips.
SENATOR OLSON asked if the increase in new carrier service was
at the expense of established carriers.
1:19:55 PM
MR.VANDERZANDEN replied it's too early to tell, but hopefully
more people travel and the pie will get bigger.
SENATOR OLSON asked how they plan on to get passengers from one
side of the terminal to the other in the winter.
MR. VANDERZANDEN replied they don't expect much cross traffic,
but if it becomes a concern, some kind of accommodation will be
provided.
SENATOR OLSON said some of his constituents from Anaktuvuk Pass
or Barter Island continue on to Seattle.
MR. VANDERZANDEN agreed to take a closer look at the situation.
SENATOR OLSON asked what kind of provisions are in place for
earthquake proofing the terminal.
MR. VANDERZANDEN replied three studies showed that the old
building was seismically deficient so the new terminal has a lot
of cross bracing and steel foundation work.
SENATOR OLSON asked about cost overruns for the project.
MR. VANDERZANDEN responded that they have stayed within or under
budget. An Anchorage Consumer Price Index (CPI) escalator was
built into the project which provided a small buffer for
increased costs.
1:23:10 PM
SENATOR WILKEN referred to MOAs (Military Operation Area) and
asked what the airport hears from civilians.
MR. VANDERZANDEN responded they are looking at eliminating IFR
(Instrument Flight Rules) traffic, but they will allow VFR
(Visual Flight Rules) traffic throughout the corridor. He said
there's concern but the depth and breadth is difficult to gauge.
SENATOR WILKEN asked if communication is working between
civilians and military and if civilian pilots rely on it.
MR. VANDERZANDEN replied that he doesn't know. They have
encouraged the military and the FAA to coordinate closely. The
amount of real time traversing through MOA is not very much. The
closer you can get to real time the more airspace is open,
minimizing the conflict. He said he's not as familiar with the
civilian as the military.
SENATOR WILKEN said the fact that Mr. Vanderzanden doesn't know
is positive because if there were trouble with that
communication, Mr. Vanderzanden would know about it.
MR. VANDERZANDEN said they are encouraging the FAA to bring the
disparate parties together.
SENATOR WILKEN commented the military knows that anytime an F16
or an F22 takes out a Piper Cub, it will be a problem for
everyone.
SENATOR OLSON asked if certain parts of the day are closed to
IFR into the airport.
MR. VANDERZANDEN replied that is currently proposed in the MOA.
VFR is still allowed but not IFR.
SENATOR OLSON asked about funding the general aviation portion
of the Capstone proposal from the governor.
MR. VANDERZANDEN deferred the question to Mr. Richards.
SENATOR OLSON asked what Fairbanks thinks about the FAA Capstone
Program ("Capstone").
MR. VANDERZANDEN replied that civilian aircraft use Capstone to
a limited extent. It's favored but costly. He thinks that people
are waiting to see if there will be some kind of program to
support it.
1:29:37 PM
MORT PLUMB, Manager, Ted Stevens Anchorage International
Airport, showed old photos of the airport from before its
construction in 1938 through the 1953 airport dedication and up
to the present. He said the Anchorage and Fairbanks
th
International Airports were appropriated by the 80 Congress in
1948 at $13 million for both. The first polar flight took place
in 1957 by SAS (Scandinavian Airlines).
1:32:30 PM
Japan Airlines used the airport until 1989 when the Berlin Wall
came down and the former Soviet Union airspace opened. The
airport today has three fully operational runways each over
10,000 feet in length.
MR. PLUMB said the airport's primary goals are safety and
security and managing at an efficient cost. It is the number 1
airport in the US as measured by the landed weight of cargo. In
2005 and 2007 the airport won awards from a national agency for
service voted on by freight forwarders and airlines. It is the
number 3 airport in the world for cargo throughput. About 5
million people travel through the airport per year. He said the
airport is the busiest and largest aviation base in the world.
72 percent of revenue is derived from cargo operations. It is
9.5 hours from most of the industrialized northern hemisphere
and equidistant between Tokyo and New York City.
He said the payload versus range is very helpful. For example,
if you go from Shanghai to Oakland, it's about 6000 miles and
you can carry 65,000 kilos. If you stop at Anchorage for an
additional 144 miles, you can carry 130,000 kilos. The
difference, at $2 a pound, is about $90,000 per aircraft. If
you're Fed Ex or UPS, etcetera, with about 5 flights per day,
that's about $450,000 per day incremental revenue, which is
about $2.25 million incremental revenue per week or $117 million
per year per company. Fuel is competitively neutral but to get
more dollars out of a gallon of gas, it makes good dollar sense
to stop at Anchorage.
MR. PLUMB said that China is about 35 percent of the market with
260 landings per week by 12 airlines. More international
carriers are coming out of China taking advantage of the 2003
accord. He pointed out a graph that listed the landed weight of
the top ten airports in 2005 showing Anchorage as number 1 at
20.7 billion pounds.
1:37:38 PM
Infrastructure development to handle this capacity has a total
budget of $454 million, the largest chunk for completion of the
A and B Concourse remodel on schedule and to be completed in
2009 with a new connector.
Ted Stevens Anchorage International Airport does not use any
general state funds. It gets funds through the federal
government, bonds and airlines revenue. It receives an FAA
issued LOI (Letter of Intent) in 1998 for $48 million and in
2003 for $60 million.
Prior to 1999, most of the construction was cash funded. In 2003
and 2006, when they applied for a bond rating, they were able to
demonstrate that they had the potential for a higher rating and
received it.
They may be able to reduce the current debt by $6 million if
they attempt a re-finance next year (and the current interest
rates continue) when their early bonds become callable.
MR. PLUMB said the passenger peak is in July when they have over
10,000 traveling through per day down to 4500 per day in
February.
From 1995 to 2005, they doubled the landing weight. Cargo
entitlements and passenger entitlements combined provide about
$20 million.
He said the airport is very competitive in the domestic and
international market regarding landing fees.
1:41:52 PM
SENATOR WIELECHOWSKI asked if Anchorage is undercharging.
MR. PLUMB responded that the airport has a residual agreement
whereby the airlines will pay all the fees whether or not they
stay. In return, they are able to vote on some of the airport
projects. He said the airport fees are competitive because 72
percent of revenue comes from cargo which keeps the landing fee
down.
The ticketing area rental rate is also low compared with other
airports due in part to a small subsidy from the landing fee to
the terminal area.
MR. PLUMB said they have not asked for an increase for the last
couple of years. They are right on budget this year. They have
recycling and a green program. They are an economic generator
for the city and state.
With regard to environmental stewardship, in addition to
recycling they are working on glycol recovery. Through RSIP
(Residential Sound Improvement Program) they are putting in new
windows and insulation in homes that are within the 65 decibel
range. In addition, with new generation engines that are coming
out, they're seeing less decibels as well as more fuel
efficiency.
MR. PLUM said that the airport is the four-time winner of the
Balchen Post Award for snow removal for large airports.
Regarding FAA re-authorization, an omnibus bill was passed which
takes them to February 29, 2008 and allows them to collect
excise tax from airlines.
Kulis Air National Guard Base plans to be fully moved to
Elmendorf by September, 2011. Airline lease negotiations are
coming up.
1:47:54 PM
MR. PLUMB said twenty-five hotel companies have responded to an
RFP and there's a plan for development of West Airpark. In the
future, he said there will probably be a tunnel to the airpark
and another runway as well as a move of the tower.
SENATOR WIELECHOWSKI expressed thanks for a great job. He asked
if there would be a bid to expand Kulis.
MR. PLUMB responded that Kulis is leased to the military so this
is just termination of a lease. They have gone through a needs
request within the state. The school district has looked at it
possibly on an interim basis. There could also be commercial
interests. They will keep the firehouse.
SENATOR WIELECHOWSKI wondered about a rumor he heard about
moving the airport should a bridge be built.
MR. PLUMB said that has been discussed. There are more
significant wetland and noise issues to consider and he believes
it will be a long time before that happens.
SENATOR WIELECHOWSKI asked if they're getting more complaints
about noise.
MR. PLUMB responded that he thinks they're getting less because
of sound insulation, different runways, and new engine
technology. They're working very hard on this issue, he said.
SENATOR WILKEN asked about the interface between civilians and
military.
MR. PLUMB explained that the Air Force is trying to work these
issues into MOA (Military Operating Airspace). He pointed out
that they are, however, a public service agency and need to
represent even the one person that has a cabin that the low
level flyers go over. He doesn't think the in-route from Asia to
the Anchorage airport will be adversely affected by MOA.
SENATOR WILKEN said the committee wants to assure that private
industry is okay before final decisions are made by the FAA.
MR. PLUMB responded that the Airman's Association watches that
closely. What Alaskans have to be concerned about, he said, is
that the infrastructure throughout the state makes it possible
for pilots to use Capstone in their planes.
SENATOR WILKEN asked about Tashkent.
1:57:42 PM
MR. PLUMB explained that Soviet airspace got cheaper, fuel costs
became more predictable and the four-hour time differential are
factors that make Tashkent a competitor. It has affected
Anchorage with JAL but most of it has been offset by increased
traffic. He said that there are more airlines operating today
than can do so cost effectively. He predicted that there will be
airline consolidations and mergers. As an airport they need to
protect themselves to make sure they're flexible to accommodate
changes.
SENATOR WILKEN asked if the loss of routes due to renewed Soviet
airspace through Anchorage will continue.
2:00:56 PM
MR. PLUMB responded that he was encouraged to hear recently that
Dubai is looking at Anchorage as a model. However, there still
could be additional loss.
SENATOR WILKEN asked if all the upgrades were completed for the
380 (Airbus A380) and if one has landed yet.
MR. PLUMB said one has not landed, but the upgrades were great
safety improvements, adding 100 feet to the taxiway.
2:02:50 PM
SENATOR OLSON commended Mr. Plumb for making Anchorage such a
hub and asked what the Ted Stevens Anchorage International
Airport has done for general aviation.
MR. PLUMB said the airport has done more for general aviation in
the last ten years than was done in the previous 40, including
lake bank stabilization, safe lighting, and parking with
electric potential.
CHAIR KOOKESH asked about a report on rural airports.
2:05:39 PM
SENATOR OLSON noted the increased number of hangars which is
important for safety. One complaint he's heard is that you've
got to have a flight physical to maintain a tie-down spot.
MR. PLUMB responded that is required.
SENATOR OLSON asked if the pilot could renew his spot for his
son.
MR. PLUMB responded that he tried grandfathering. He thinks
there should be a way to take care of people who have been there
for a long time. There's also an equal number who have waited
their time.
SENATOR OLSON asked if the number of lifeguard flights has
increased as well.
MR. PLUMB responded that he didn't know.
SENATOR WIELECHOWSKI asked about the aviation issue regarding
the wind farm on Fire Island.
MR. PLUMB responded he didn't know if it had been resolved.
2:08:37 PM
CHAIR KOOKESH thanked Mr. Plumb for his presentation.
MR. RICHARDS presented an overview of the rural system. He
showed a photo of the Little Diomede Heliport demonstrating the
unique kind of facility his agency can provide. In Alaska, DOT
owns the majority of the publicly owned airports, a total of
256. About 30 are owned by villages and other agencies. DOT owns
and operates airports in every village in the state. 70 of DOT's
runways are less than 3000 feet in length and the goal is to
increase them to at least 3300 feet. 28 of DOT's airports still
don't have permanent lighting. Hours of operation have been
expanded. The operations are performed out of regional offices.
These offices plan construction and deal with air quality. The
FAA is the regulator as well as funding partner. The largest
challenge is the FAA mandate to build 1000 foot safety areas on
each end. The FAA also assumes direction of the environmental
impact statements, but DOT would like to take over that role.
2:15:47 PM
MR. RICHARDS said the Transportation Security Administration
governs the security provisions in airports that receive jet
traffic. In Alaska, there are three security directors. Cost of
construction has seen a steep escalation. Dust is a big problem.
Air quality monitoring has been installed. Particulate exceeded
national air quality standards in some airports. He said this is
of concern because it could enable the FAA to direct where
federal funds are spent. DOT is addressing the situation with
dust palliatives with some success.
2:19:48 PM
He said the airports are also experiencing floods and coastal
erosion. DOT is especially concerned about the communities of
Kivalina, Newtok, and Shishmaref.
MR. RICHARDS said DOT has developed a budget for funding needs
of $955 million for primary and non-primary airports. Most of
the funds come from federal aviation and airport improvement
programs. DOT also gets General Funds through the legislature to
address safety issues and maintenance. The most recent projects
are in South Naknek and an airport for the community of Chignik
Lagoon.
Maintenance and operations are predominantly funded by General
Funds. He said in 2007 $123 million was allocated for the rural
system.
SENATOR WILKEN asked if that is an annual appropriation.
MR. RICHARDS said the hope is that the federal re-authorization
will be at higher levels.
SENATOR WILKEN asked if it becomes part of a formula once the
authorization goes through.
MR. RICHARDS said they get entitlements for the state of Alaska
based on cargo and passengers. He showed a comparison of how
money has been distributed between rural and international
systems.
He said the FAA has been very generous especially on runway
safety areas and is not requiring those funds to be deducted
from the annual allocation. The FAA requires that the runway
expansion be completed by 2013.
2:25:00 PM
When Mr. Richards started in the department 10 years ago, the
budget was $3-5 million; now the budget is between $12-15
million.
He said a large portion of the new Angoon airport will be in the
wilderness. It will have a road, which is an indication of money
being spent around the state for rural Alaskans. For the future,
new community airports, in addition to Angoon, include one in
Akutan in the Aleutians. The challenge there is no flat spot to
put it on so it will need to be on an adjacent island which will
require a shuttle ferry or hovercraft.
The introduction of larger turbine aircraft into rural Alaska
will require airport upgrades. FAA has imposed on larger
carriers the requirement to fly in only when there is fair
braking action which requires a certain friction range. Huge
costs accrue from snow blowers, graders, plow trucks, sand and
chemicals to create the right condition.
USPS has proposed expanding mail hubs in 14 new communities. For
DOT this means expansion of airports. The USPS would save $2
million per year. The question is does the cost accrue to the
state.
The governor is presenting a proposal to the House and Senate
for a loan program to fund Capstone technology for private
owners to install. Security regulations are expanding.
CHAIR KOOKESH asked if Mr. Richardson's slide presentation is
available online.
MR. RICHARDSON replied it is.
SENATOR WILKEN asked Mr. Richardson to discuss the Aviation
Advisory Board from the prior administration.
MR. RICHARDSON said it is still an active board. The next
meeting is scheduled next week in Fairbanks.
2:32:07 PM
SENATOR OLSON, referring to a slide, asked if people are still
living in Platinum. Ten years ago they were having a difficult
time keeping the school open.
MR. RICHARDSON said people do live there.
SENATOR OLSON asked if people are bringing mail and food from
Fairbanks to Kayenna because you've got to refuel in Kotzebue.
He asked what the administration's stance is on the new hubs.
MR. RICHARDSON said he's asked staff to identify what
improvements will be needed. He said a minimum length of 5000
feet is necessary. There'll be a dialogue with the postal
service to see if it's worthwhile. He said airlines also have
infrastructure requirements.
SENATOR OLSON asked if the governor's loan proposal satisfies
federal requirements.
MR. RICHARDSON said the federal government is looking for some
entity to come up with 34 million to fund Capstone for 4000 air
craft which represents 90 percent of flight hours in Alaska.
Since DOT is not providing that safety factor for other
transportation entities, it came up with the plan for a loan
program.
2:35:49 PM
CHAIR KOOKESH adjourned the meeting and said there would be no
meeting next Thursday.
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