GENERAL OBLIGATION BONDS Co-Chair Mulder noted that there were $1.4 billion dollars in general obligation (GO) bond requests. The attorneys indicated that they could not be included in one ominous bond bill. The intent was to use as few vehicles as possible and identify consistent themes. He observed that HB 524 contains GO bonds for new schools and university construction. House Bill 525 contains GO bonds for deferred maintenance of public facilities. Bond debt reimbursement was used for projects that did not fit into a GO bond package, because they were previously leveraged [HB 528]. Representative Lancaster's energy bill [HB 175] was utilized for the final component. House Bill 524 and HB 525 would appear on the November general election ballot. Co-Chair Mulder observed that projects were prioritized. The priority lists were strictly used with one exception. In new school construction, out of the first six schools: three were in [Representative Kaspner's] district and three were in Representative Foster's district. The proposed committee substitute took the first two [in Representative Kaspner's district] and the first two from Representative Foster's. HOUSE BILL NO. 525 "An Act relating to the issuance of general obligation bonds for the purpose of paying the cost of deferred maintenance of public facilities; and providing for an effective date." Co-Chair Mulder provided members with proposed committee substitute, work draft LS1735\C, dated 4/29/02 (copy on file.) The proposal, totaling $203,744,270, provides for repair of: schools, University of Alaska facilities, state owned docks and harbor facilities, and state owned buildings. The proposal provides $121,269,770 dollars for 90 school projects around the state. The list includes those schools approved by the department of Education and Early Development for major maintenance. The $5,560,000 dollars designated for the University of Alaska includes repair to facilities on campuses in Valdez, Palmer, Ketchikan, Kodiak, Fairbanks, Kotzebue, Nome, and Bethel. The 31,887,500 dollars allocated for docks and harbors will refurbish facilities in Whittier, Seldovia, Juneau, Ketchikan, Sitka, Cordova, Wrangell, Yakutat and Kiawock. In addition there is $48,500,000 dollars for dire maintenance needs throughout the state. He observed that the governor introduced a bill for Certificate of Participations deferred maintenance for state facilities at approximately $200 million dollars. He explained that he was concerned that a straight state facilities deferred maintenance general obligation bond would fail to be pass by the public. The intent was to create a category that could satisfy the most urgent concerns. He observed that the list could change. The Administration indicated that there might be items that are higher in the prioritization. The list provided by the state director was used to compile the legislation and might change as a response to submissions by the Governor's Office. Co-Chair Mulder added that funding for the Juneau Douglas High school remodel was added. Representative Hudson observed that the low bid was $3 million dollars higher [than the previously appropriated amount]. Representative Croft noted that the list was followed to item 81 and Anchorage, Kenai, Juneau and Nome were picked up. He referred to item 51, Kenai school fire alarm upgrade. He questioned the funding level. There were some life health and safety code violation concerns. The funds for the Juneau-Douglas High school would complete the project. Co-Chair Mulder reviewed section 4 and noted that it contains deferred maintenance projects as brought forward by the University. Co-Chair Mulder referred to section 5. He observed that a bond debt reimbursement for ports and harbors, which many communities did not want to participate in had been passed in a previous year. They are included as general obligation bonds under deferred maintenance. Ports and harbor projects fail into two categories. He explained that projects for existing ports and harbors are listed under deferred maintenance. Other ports and harbors in the debt reimbursement package are for new design and planning. Representative Croft observed that the state had offered to turn certain ports and harbors to local communities, which did not want to assume responsibility because they had not been maintained. This raised the issue of how they could be raised to a level where the municipalities could take them over. Co-Chair Mulder clarified that there are a variety of mechanisms that could be used. He stressed that there is nothing more important to economic development in costal communities than ports and harbors. The intent is to be sympathetic to fishing communities that are having tough times. Vice-Chair Bunde referred to subsection (4) in section 6: Mt. Edgecumbe High School and Alaska Vocational Technical Center major deferred maintenance. Co-Chair Mulder explained that the Department of Transportation and Public Facilities manages the deferred maintenance program. State rankings were taken, but projects were listed alphabetically. Representative Hudson clarified that the Alaska Vocational Technical Center is in Seward; both are state facilities. Co-Chair Mulder noted that section 6, statewide ADA compliance might need to be modified. Representative John Davies asked if the maintenance stations had been addressed. Co-Chair Mulder did not know. He stated that they would be considered. The intent is to stay below $400 million dollars. Representative John Davies observed that there was a public facility in Ketchikan with major maintenance concerns. Co- Chair Mulder thought that it had been included. HB 525 was heard and HELD in Committee for further consideration.