HOUSE BILL NO. 131 "An Act relating to relocation assistance for federally assisted public construction and improvement projects and programs; and providing for an effective date." 2:13:17 PM LAURA STIDOLPH, STAFF, REPRESENTATIVE ADAM WOOL, read from a prepared statement: In front of you is House Bill 131 "Federal Relocation Assistance Programs/Projects" which will bring Alaska into compliance with Federal law concerning reimbursement for relocation expenses incurred by individuals or businesses that were displaced due to a federally-funded highway, bridge, or facilities project. Alaskans deserve to be fairly compensated in these circumstances. HB131 will also protect Alaska's 500+ million dollar annual allocation of Federal Highway Administration funding by bringing the state into compliance. In 2012, Congress relaxed the eligibility criteria and increased the maximum reimbursement limits for State's relocation assistance payment programs when they passed their transportation authorization and funding bill, the Moving Ahead for Progress in the 21st Century Act, aka MAP-21. Prior to MAP-21, the payment rates had not been changed for 30 years. These changes went into effect October 1, 2014. Unfortunately, Alaska Statute continues to reflect the more stringent eligibility criteria and the smaller maximum reimbursement limits. th During the second half of the 29 Alaska Legislature, this inconsistency between state and federal law was nearly fixed. Language similar to HB 131 was proposed and passed the House unanimously. It passed through the Senate State Affairs and Senate Finance. However, the bill was held in Senate Rules and never calendared for a Senate floor vote. HB 131 assures Alaskans that their Legislature wants them to be compensated the same as a resident of any other state. Thank you for the opportunity to present this bill on behalf of the House Transportation Committee. Heather Fair, the Department of Transportation & Public Facilities' Statewide Right-of-Way Chief, is here to answer any questions you may have. · Property acquisition and therefore the subsequent displacement of individuals and relocation of their homes/businesses is the exception, not the norm. Our engineers work hard to design projects in a manner such that we do not encroach upon private property. · Relocation assistance payments are reimbursements for actual, documented relocation expenditures. If a party does not have the means to relocate themselves up front, there is a hardship program that will help with the cost. · The new payment amounts created in federal law are maximums; · The payments we do make are a mix of approximately 91% federal funding and 9% state funding. 2:15:42 PM Representative Wilson asked whether the federal government also compensated for the lost property. Ms. Stidolph indicated that the bill only dealt with relocation costs. Representative Wilson asked whether the federal government addressed property loss under another component of the program. Ms. Stidolph deferred to the Department of Transportation and Public Facilities (DOT) for the answer. 2:17:02 PM HEATHER FAIR, CHIEF OF RIGHT-OF-WAY, DEPARTMENT OF TRANSPORTATION, asked for clarification of the question. Representative Wilson asked whether the federal government had a program that paid fair market value for displaced property owners. Ms. Fair answered in the affirmative. She indicated that the federal government placed the guidelines in the "Uniform Act." She noted that MAP-21 updated the Uniform Act specific to relocation. The department met federal requirements via state statute to compensate for acquisition of property separate from relocation. Representative Wilson asked whether the state was currently in compliance with federal acquisition regulations. Ms. Fair responded in the affirmative. 2:18:21 PM Vice-Chair Gara commented that the cost of the relocation compensation was absorbed when the legislature funded capital projects. He asked whether the higher compensation rate warranted an indeterminate fiscal note. Ms. Fair replied that the state contributed roughly 9 percent to the federal government's 91 percent contribution on federal projects. She shared that the department tried to minimize impacts on Alaskan families, businesses, and farms when designing projects. The department had run some numbers on known projects and determined that the state's share equaled about $12 thousand. Representative Pruitt noticed that the fiscal note was retroactive to 2014. He wondered about the fiscal aspect of the retroactivity. Ms. Fair answered that the state's contribution was less than a "few thousand dollars" in retroactive payments. She was uncertain whether the state had paid the recipients or if the money was set aside. Since the state was currently out of compliance with MAP- 21, the state was not able to make the payments and comply with state law at the same time. Representative Ortiz wondered to what extent the legislation remedied a potential problem in the future. He asked whether a significant amount of people in the past had access to relocation benefits. Ms. Fair responded that the bill affected less than 12 people. Vice-Chair Gara asked whether the bill increased the number of people eligible for compensation. Ms. Fair responded that the legislation increased eligibility because the federal government "relaxed" the requirements. However, currently the eligibility in Alaska did not increase. 2:22:09 PM Representative Wilson surmised that the state would owe more money for the retroactive payments, even if the amount was small. Ms. Fair responded that she was correct. However, she reiterated that she was uncertain whether the retroactive payments were made because, so few people were affected. Representative Kawasaki wanted to challenge the zero fiscal note. He referred to the document in the members files titled "DOT&PF's Proposed Bill for Relocation Assistance Program Compliance" (copy on file). He mentioned several of the increases listed in the document that included: Increases maximum reestablishment expense payment from $10,000 to $25,000 Increases maximum amount of the fixed payment for nonresidential moves from $20,000 to $40,000 Increases maximum purchase price differential for homeowners from $22,500 to $31,000 Representative Kawasaki thought that the increases "seemed like a lot." He recognized that the state's share was roughly 9 percent but thought the amount could add up for future projects. He asked her to speak to the potential cost increases of projects in the future. He thought recipients would request the highest level of reimbursement. Ms. Fair responded that the reimbursements were based on actual expenses. She agreed that if a project DOT was unable to redesign had high impacts, it was possible that the state's 9 percent share could be costly. She determined that it was impossible to know regarding projects that were 3 to 5 years away from construction. She stressed that the department always endeavored to minimize impacts. 2:24:49 PM Co-Chair Foster OPENED Public Testimony. Co-Chair Foster CLOSED Public Testimony. Co-Chair Foster requested that amendments be submitted by Monday at 5:00 pm. HB 131 was HEARD and HELD in committee for further consideration.