HB 253-SALE, TRANSFER, OR DISPOSAL OF FERRIES  1:07:56 PM CHAIR STUTES announced that the first order of business would be HOUSE BILL NO. 253, "An Act relating to the powers of the Department of Transportation and Public Facilities; and relating to the sale, transfer, or disposal of state ferries." 1:08:56 PM CHAIR STUTES opened public testimony on HB 253. After ascertaining that there was no one who wished to testify, she closed public testimony. 1:09:24 PM REPRESENTATIVE DRUMMOND moved to adopt Amendment 1, labeled 31- LS1541\M.4, Fisher, 3/10/20, which read as follows: Page 1, following line 7: Insert a new bill section to read:  "* Sec. 2. AS 19.65.060(a) is amended to read: (a) There is created, as a special account in the general fund, the Alaska marine highway system fund, into which shall be deposited (1) the gross revenue of the Alaska marine highway system; (2) money that is appropriated to the Alaska marine highway system fund by the legislature in an amount that is consistent from year to year and is the amount necessary, after consideration of gross revenue, to provide stable services to the public consistent with the provisions of AS 19.65.050(b)(4), which appropriations are not one-year appropriations and the balances of which do not lapse under AS 37.25.010; [AND] (3) any other money that is appropriated to the Alaska marine highway system fund by the legislature, which appropriations are not one-year appropriations and the balances of which do not lapse under AS 37.25.010; and (4) the proceeds from the sale, transfer,  or disposal of a ferry, except for proceeds that are  required to be used for an eligible purpose under 23  U.S.C." 1:09:29 PM CHAIR STUTES objected, for the purpose of discussion. 1:09:36 PM REPRESENTATIVE DRUMMOND said Amendment 1 would ensure that any proceeds from sale, transfer or disposal of ferries would return funds to the appropriate account. 1:10:08 PM SARA PERMAN, Staff, Representative Louise Stutes, Alaska State Legislature, on behalf of Representative Stutes, prime sponsor of HB 253, explained that Amendment 1 would add a section stating that any proceeds from the sale, transfer, or disposal of a ferry - except for those classified in Title 23, Federal Highway Administration dollars - would be returned to the Alaska Marine Highway System (AMHS) fund. Vessels built with federal dollars were not eligible to go straight to AMHS, she explained. Funds that were not able to be separated could go back to AMHS. 1:11:10 PM REPRESENTATIVE DRUMMOND presented an example wherein a ferry that had been built with 90 percent federal funds generated $200,000, and she asked whether $180,000 would be returned to the federal fund. 1:11:54 PM MS. PERMAN responded that the lifetime of a vessel was also a factor: if a vessel had lived its lifetime there may be a different calculation in terms of which funds were returned to the federal fund. 1:14:16 PM The committee took a brief at-ease at 1:14 p.m. 1:14:51 PM MATT MCLAREN, Business Development Manager, Alaska Marine Highway, replied that it was not simply a matter of a ship having been built with federal funds, but any federal funds used on the vessel from the date it was built through the current date, as well as improvements made using federal dollars that would be factored in, as well as how much money the state had put into the vessel over the years. Inflation was also a factor, he said. In terms of the motor vessel (M/V) Taku, 63.9 percent was the federal portion, and 36.1 percent was determined to go to the state. 1:15:48 PM REPRESENTATIVE CLAMAN asked whether the AMHS fund was a designated or a dedicated fund. 1:16:19 PM ROB CARPENTER, Deputy Commissioner, Department of Transportation and Public Facilities, replied that funds are designated for AMHS, not dedicated. 1:16:30 PM CHAIR STUTES reopened public testimony on HB 253. 1:16:49 PM JANICE WRENTMORE, Chair, Skagway AdHoc Marine Highway Committee, testified in support of HB 253. She said she would like to learn what happens to vessels, and she offered her experience and understanding that communities that inquire almost never hear back from AMHS staff. Ms. Wrentmore remarked that AMHS does not get much from the sale of vessels. She said she thinks there should be some public scrutiny of the process and suggested the information could be provided in the form of an engineer's report, so folks could learn about the vessel's issues. She then suggested that AMHS offer [retired] vessels to Alaska communities. 1:19:22 PM CHAIR STUTES removed her objection to the motion to adopt Amendment 1. There being no further objection, it was so ordered. 1:19:52 PM CHAIR STUTES closed public testimony on HB 253. 1:20:48 PM The committee took an at-ease from 1:20 p.m. to 1:21 p.m. 1:21:14 PM REPRESENTATIVE EDGMON moved to report HB 253, as amended, out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHB 253(TRA) was reported out of the House Transportation Standing Committee.