SENATE BILL NO. 46 "An Act making capital appropriations and appropriations to capitalize funds; and providing for an effective date." This was the second hearing for this bill in the Senate Finance Committee. Department of Commerce, Community and Economic Development Manufacturing Extension Program $1,600,000 $800,000 BLic Rcpts $800,000 Fed Rcpts Reference No.: 40242 Category: Development Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project The Federal Manufacturing Extension Program (MEP) will support Alaska's small and medium sized manufacturers throughout the state by providing them access to knowledgeable manufacturing and business specialists throughout the United States. This program contributes to the Department's mission of promoting a healthy economy by developing the business skills of Alaska's small manufacturing companies. JOHANA HANRAHAN, Director, Division of Administrative Services, Department of Commerce, Community and Economic Development, informed the Committee that this request has been removed from this legislation, and is being advanced in the Supplemental bill legislation. Alaska Visitors Statistics Program $750,000 Gen Fund Reference No.: 40078 Category: Development Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005-06/30/2010 One-Time Project Continuation of the Alaska Visitors Statistics Program (AVSP). This Program continues the comprehensive collection and presentation of information on Alaska's visitors. This program contributes to the Department's mission of promoting a healthy economy by assisting the visitor industry in marketing Alaska. Ms. Hanrahan stated that this continuing program provides demographic, characteristic, and expenditure patterns and opinions of travelers to the State. The information is used to gauge impacts to visitor infrastructures and facilities, to determine investments in visitor attractions and services and the effect on State lands and other natural resources, and to develop the tourism-marketing program. Senator Bunde commented that this program must be "a great asset" to commercial enterprises in the visitor industry. Due to the fact that the State is shifting to a policy of user pay, he asked whether an estimate on the project's rate of return to the general fund has been developed. Ms. Hanrahan responded that data that has been gathered pertaining to the increase in the number of visitors and revenues resulting from promoted venues might address the question. Specific information would be provided. Senator Bunde stated that the State must seek more support from the industry. Tourism Promotion $530,000 Gen Fund Reference No.: 40495 Category: Development Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005-06/30/2010 One-Time Project Various tourism marketing projects to promote and increase tourism in Alaska. This request contributes to the Department's mission of promoting a healthy economy by assisting the tourism industry and those businesses benefiting from the tourism industry. Ms. Hanrahan stated that this project has five different components: to augment national cable network television marketing by increasing the number of weeks of advertising; to expand the number of national cable networks being utilized; to increase the State's online advertising presence on key trip-planning websites; and to enhance the TravelAlaska.com website specifically to include an online forum on the site. Research has indicated that an increasing number of travelers are using Internet websites to plan and research travel options. Senator Bunde reiterated that the return to the State should be a consideration as "creating jobs is not enough". Senator Hoffman asked regarding the justification for requesting a one-year rather than an on-going marketing program; specifically whether the one-year request is being proposed to address a lull in the number of visitors to the State. Ms. Hanrahan responded that this is considered to be a multi-year project, as the request would provide funds for more than one year. The project would boost tourism. Senator Hoffman inquired to the amount of the request that would be expended in FY 06. Ms. Hanrahan replied that this information would be provided. Co-Chair Green asked that the total FY 06 tourism category funding, to include all fund sources in both the operating and capital budgets, be provided. Ms. Hanrahan stated that this information would be compiled. Ms. Hanrahan continued that the request would also promote independent visitor traffic on the Alaska Highway by providing funds to pre-qualified journalists to experience and write about it. Independent travel on the Alaska Highway has been experiencing limited growth. The fifth area that would be addressed with these funds would be to further sales and training missions to promote an Alaska/Asian relationship. Organization Grants $700,000 Gen Fund Reference No.: 40056 Category: Development Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Grants to unincorporated communities to defray the cost of incorporation. Each unorganized city or borough that incorporates after December 31, 1985 is entitled to an organization grant under AS 29.050.180 -.200. This grant contributes to the Department's mission of promoting a healthy economy and strong communities by assisting communities in achieving maximum self-government. Ms. Hanrahan stated that this request would provide grants to assist local governments in transitioning to a borough. Potentially the Prince William Sound area, the City of Delta Junction/Delta- Greely area, the Anchor Point area, and others might soon become organized boroughs. Co-Chair Green asked whether this could be characterized "as just an anticipation." Ms. Hanrahan responded that some of the petitions have been filed and others are anticipated. According to Title 29 guidelines, communities that organize are entitled to receive State funding assistance for three years after organization. This funding request would fund the first of three years. Senator Olson asked for further information regarding the assistance that must be provided to organizing communities. Ms. Hanrahan responded that a newly organized borough or unified municipality would receive $300,000 its first year, $200,000 the second year, and $100,000 the third year. Senator Olson understood therefore that $600,000 would be provided. Co-Chair Green commented this is the amount specified in State statute. Ms. Hanrahan concurred. Community Development Grants $14,538,000 $14,050,000 Fed Rcpts $ 488,000 Gen Fund Reference No.: 38943 Category: Development Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2010 On-Going Project Multiple federally-funded programs, enabling Commerce to provide grants to communities and non-profit organizations for community development. This program contributes to the Department's mission of promoting a healthy economy and strong communities by providing economic growth in the communities it serves. Ms. Hanrahan informed that this program assists communities with developing flood plains and erosion management programs; grants to assist small communities expand and diversify their economy; and programs that allow Rural communities to construct or remodel multi-use facilities. Communities contribute a match ranging from ten to 25 percent of the cost of such projects. In FY 05 and FY 06, 48 unmapped communities in the Lower Kuskokwim and Bering Straits, Copper Valley, and Southeast areas would receive accelerated infrastructure development grants that would allow them to develop profile maps. The request would also provide funds to the State's Bulk Fuel Bridge Loan program and funds to mitigate the impact of the Fort Greely Missile Defense development's construction and operation. Community Block Grants $6,115,000 $6,045,000 Fed Rcpts $ 70,000 Gen Fund Reference No.: 38946 Category: Development Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2010 On-Going Project Multiple federally-funded programs, enabling Commerce to provide grants to communities and non-profits that provide services and/or benefit the low- to moderate- income individuals. This program contributes to the Department's mission of promoting a healthy economy and strong communities by providing economic growth in the communities it serves. Ms. Hanrahan stated that this long-term on-going program would provide funds to the Rural Alaska Community Action Program (RACAP) for such things as training and educational drug and alcohol abuse programs as well as nutrition grant programs. Homeless assistance grants, emergency shelter grants, and funds to municipalities to assist planning and infrastructure development are also provided. The federal funds require a small State match. Energy Projects $20,750,000 $250,000 Bond Funds $20,000,000 Fed Rcpts $500,000 I/A Rcpts Reference No.: 38950 Category: Development Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2010 On-Going Project Multiple federally funded energy programs of Bulk Fuel Upgrades, Rural Power Systems Upgrades, Alternate Energy and Energy Efficiency projects. This program contributes to the Department's mission of promoting a healthy economy and strong communities by providing economic growth in the communities it serves. Ms. Hanrahan explained that this mostly federally funded program would fund a wide variety of energy programs including bulk fuel upgrades, rural power system upgrade programs, and alternative energy and energy efficiency projects. Senator Bunde declared that he was "not looking forward to the day" when these federal funds might dissipate and the onus might be to replace them with general funds. Language Section: Electrical Emergencies $330,000 Rural Elec Reference No.: 32590 Category: Health/Human Services Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30-2010 On-Going Project To provide technical support when an electric utility has lost the ability to generate or transmit power to its customers and the condition is a threat to life, health, and/or property in the rural community. This program contributes to the Department's mission of promoting a healthy economy and strong communities by providing economic growth in the communities it serves. Ms. Hanrahan read the project description. Language Section: NPR-A Impact Grant Program $29,517,700 NPR Fund Reference No.: 38948 Category: Development Location: Barrow Election District: Arctic Estimated Project Dates: 07/01/2005 - 06/30/2010 On-Going Project Grants to communities for public facilities and services. Priority is given to those communities directly or severely impacted by the leases and development of oil and gas within the National Petroleum Reserve. This program contributes to the Development's mission of promoting a healthy economy and strong communities by providing economic growth in the communities it serves. Ms. Hanrahan reviewed the project description. Co-Chair Green asked that a list of the projects affected by this request be provided. Ms. Hanrahan agreed to provide the information. Co-Chair Wilken requested that this project be assigned to a subcommittee that he might chair, for further analyzing and development. Co-Chair Green agreed. Senator Stedman, Senator Dyson, and Senator Olson asked to serve on the subcommittee. Co-Chair Green announced that Co-Chair Wilken would be the subcommittee chair. Kodiak Launch Site Infrastructure $36,000,000 Fed Rcpts Reference No.: 40008 Category: Development Location: Kodiak Election District: Kodiak Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Kodiak launch site infrastructure to support the U.S. Department of Defense's Missile Defense Program. This program contributes to the Department's mission of promoting a healthy economy and strong communities by providing economic growth in the communities it serves. Ms. Hanrahan stated this request would be federally funded. The intent is to bring the Kodiak launch site to meet federal Department of Defense requirements. Protection and Education of Investors $300,000 Stat Desig Reference No.: 40505 Category: Education Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2010 Protection and education of consumers/investors in accordance with a national securities settlement with 10 of the nation's top investment firms. This project contributes to the Department's mission of promoting a healthy economy and strong communities by educating the public in sound financial planning. Ms. Hanrahan noted that this request is being withdrawn as it has been determined that rather than this money being directed to the State, the State could recommend entities within the State that it could be directed to. Senator Bunde suggested that the money be directed to the PERS and TRS retirement programs so that the systems could have an informed group of investors in regards to such things as the proposed Defined Contribution Retirement program. Co-Chair Green thanked Senator Bunde for the suggestion. 9:37:14 AM Morris Thompson Cultural and Visitors Center $250,000 Gen Fund Reference No.: 40500 Category: Development Location: Fairbanks Areawide Election District: Fairbanks Areawide Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Grant for the Morris Thompson Cultural and Visitors Center. Ms. Hanrahan stated that this Center would provide visitor information services, visitor trip planning, environmental education, and exhibits. The total estimated cost of the Center would be $26 million: $15 million of federal funds and the remaining funds to be from the State and private contributors. Co-Chair Green asked when the project might be completed. Ms. Hanrahan replied that the conceptual design phase is reaching completion. Requests for bids have not been let. In order to complete the construction project by the spring of 2006, $4.5 million must be raised in 2005. The final completion date is unknown. Co-Chair Green asked whether this is the only budget request associated with the Morris Thompson Cultural Center. Ms. Hanrahan replied that this is the only request being furthered by the Department. Further research regarding the project's total funding would be conducted. Co-Chair Green commented that this item might be revisited. 9:39:46 AM City of Valdez - Harborview Demolition $1,000,000 Gen Fund Reference No.: 40517 Category: Development Location: Valdez Election District: Richardson/Glenn Highways Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Demolition of Harborview building. Ms. Hanrahan stated that the land on which this building sits was transferred to the City of Valdez. Since there is no viable economic use of the building, which was closed in 1997, the City is requesting funds to demolish and remediate the site. The building does contain hazardous materials. Co-Chair Green asked whether the City of Valdez would be liable were any hazardous materials found. Ms. Hanrahan asked for clarification whether the question pertained to liability during demolition. Co-Chair Green expressed that the liability question pertained to both during and after demolition. In other words, would the State would have other obligation other than providing funds. Ms. Hanrahan stated that further information would be provided. Co-Chair Wilken asked the funding history attached to this project, as this is the seventh request to demolish this building that he has heard in as many years as a Member of this Committee. Ms. Hanrahan stated that the information would be provided. 9:41:53 AM Tongass Coast Aquarium, Inc. $100,000 Bond Funds Reference No.: 40497 Category: Development Location: Ketchikan Gateway Borough Election District: Ketchikan Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project A grant for the Tongass Coast Aquarium, which will be a regional facility providing education, research and exhibits focusing on the coastal and marine ecosystems of Southeast Alaska. This project contributes to the Department's mission of promoting a healthy economy and strong communities by providing educational opportunities and economic development in Southeast Alaska. Ms. Hanrahan read the project description and stated that the funds would assist in constructing a 28,000 square foot aquarium. Co-Chair Green asked that the funding history, to include the State's total obligation; the amount the federal government has provided; and other revenue sources, of this project be provided. Ms. Hanrahan informed that this project is currently in the design phase. No formal bids have of yet been requested. The total cost is projected to be $27 million. The total funding request to the State might range between one and four million dollars. Co-Chair Green asked for clarification purposes, the amount being requested this year. Ms. Hanrahan stated that the FY 06 request is for $100,000. Alaska Native Heritage Center $500,000 Gen Fund Reference No.: 40498 Category: Development Location: Anchorage Areawide Election District: Anchorage Areawide Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Grant to the Alaskan Native Heritage Center for the repair and construction of Alaskan Native village exhibit sites. This request contributes to the Department's mission of promoting a healthy economy and strong communities by assisting the tourism industry and those businesses benefiting from the tourism industry. Ms. Hanrahan noted that this is the only Native educational and cultural center in the State that showcases the cultures of the State's native people "to the public and to school children". The Center is a premier tourist destination and, in partnership with an international and Alaskan tour operators, hosts approximately 100,000 visitors annually. It provides in excess of 100 jobs and is a marketing outlet for Rural handicrafts and cultural items. Co-Chair Green asked whether this project could be supported by its revenues, private donations, and other resources. Ms. Hanrahan expressed that this request would fund the construction of one village site and a playground within that site. The overall plan is to construct five village sites that would represent the dwellings of each of the State's five regions. Co-Chair Green pointed out that the request states that the funds would be for the repair and construction of exhibit sites. Ticket sales and other income processing venues should provide for the cost of repairs, as the project should be self-sustaining rather than continuing to request State funding. Ms. Hanrahan stated that further information would be provided. Lower Kuskokwim School District - The People's Learning Center $1,000,000 Gen Fund Reference No.: 40502 Category: Development Location: Bethel Election District: Bethel Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Grant to the Lower Kuskokwim School District for the construction of the Yuut Elitinaurviat, The People's Learning Center. This project contributes to the Department's mission of promoting a healthy economy and strong communities by providing educational opportunities in the community. Ms. Hanrahan read the project description and noted that three million of the total eight million dollar project cost has been raised. Additional funding has been requested from the Alaska Native Education Grant Program, the Bureau of Indian Affairs, and from Alaska Congressman Ted Stevens' office. 9:47:06 AM City of Unalaska - Boat Harbor $2,000,000 Bond Funds Reference No.: 40501 Category: Development Location: Unalaska Election District: Bristol Bay/Aleutians Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Grant to the City of Unalaska for a boat harbor at Little South America in Unalaska. This project contributes to the Department's mission of promoting a healthy economy and strong communities by providing infrastructure necessary for commercial enterprises and the community of Unalaska. Ms. Hanrahan stated that this request would address "a serious lack of moorage" in Unalaska. The breakwater construction would cost approximately $11 million. While the City of Unalaska is responsible for the inner harbor improvements, this request would assist to support the total $17 million project cost. Senator Stedman asked whether additional funding requests, beyond this two million dollar request, might be forthcoming. Co-Chair Green asked the Department to provide this information. Senator Stedman also asked whether moorage fees and other income venues established by the City would sufficiently provide for on- going maintenance and replacement reserves for the project upon completion. The concern is that this harbor might be in a state of disrepair in 30 years as has been the experience with other harbors in the State. Senator Bunde asked that information be provided about the plans to fund the on-going operating and maintenance costs of the Lower Kuskokwim School District - The People's Learning Center Senator Olson asked whether the Unalaska boat harbor is located at the staging area site for the response to the December 2004 wreak of the tanker, the Selendang Ayu. Ms. Hanrahan would clarify that information. City of Cordova - Cordova Center $1,000,000 Gen Fund Reference No.: 40503 Category: Development Location: Cordova Election District: Cordova/Southeast Islands Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Grant to the City of Cordova for the construction of a Community Center in Cordova. This Request contributes to the Department's mission or promoting a healthy economy and strong communities by providing infrastructure necessary for commercial enterprises and the community of Cordova. Ms. Hanrahan stated that this request would provide for a 32,000 square foot community center that would provide conference, convention, theater and training spaces; oil spill response training; an incident and emergency command and communication center; as well as space for a joint State and federal visitors facility. A public library for the elementary school might also be included. Senator Bunde asked that information be provided regarding the funding source for the center's operations and maintenance needs. Ms. Hanrahan stated that this concludes the Department's capital project requests. Co-Chair Wilken understood that the Department might be requesting funds for a film project. Ms. Hanrahan responded that no request in that regard is being presented. AT EASE: 9:51:53 AM / 10:04:59 AM Department of Corrections Institution Closed Circuit TV System Recording $2,500,000 Bond Funds Reference No.: 40267 Category: Public Protection Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2010 One-Time Project Project will provide digital video recording systems within 11 Correctional Facilities statewide. MARC ANTRIM, Commissioner, Department of Corrections, stated that this request would provide for closed circuit television and digital video recording systems through which to monitor prisoners. The first phase of the project would be the installation of cameras and the second phase would be the installation of the recording equipment. This project would expand the current system to allow the monitoring of living areas in addition to doorway and other traffic areas. In addition to reducing incidents of prisoner violence and property damage, the system would allow the Department to comply with federal laws enacted in 2003. Deferred Maintenance, Repair, and Renovations $8,000,000 Bond Funds Reference No.: 36788 Category: Public Protection Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 60/30/2011 On-Going Project Essential repair and renovation of electrical, mechanical, roofing, fire/life safety, security, structural, food service, pavements and site drainage systems at all correctional facilities. This work is required to enable continued safe, secure and efficient operation of the 24-hour incarceration facilities. Commissioner Antrim stated that this request would address the extensive list of deferred maintenance needs of the 117 facilities maintained by the Department. The majority of these facilities exceed twenty years of age; ten percent are at least 30 years old; and another ten percent exceed 40 years of age. A list of needs is included in the packet. Statewide Equipment Replacement $450,000 Bond Funds Reference No.: 30815 Category: Public Protection Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2011 On-Going Project Replace essential security, life safety, food service, laundry, medical, records storage and maintenance equipment at all correctional institutions. This equipment is required to provide continued support of the officers and staff in confining incarcerated offenders and in maintaining safe operation of the institutions. Commissioner Antrim stated that these funds would provide for the replacement of many critical items, including such things as snow removal equipment, grounds equipment such as lawnmowers, and fixed kitchen items such as stoves, steam kettles, and microwave ovens. Maintenance needs for such items has been deferred for many years. Community Jails Life, Safety and Security Renovations and Miscellaneous Equipment $100,000 Bond Funds Reference No.: 30818 Category: Public Protection Location: Statewide Election District: Statewide Estimated Project Dates: 07/01/2005 - 06/30/2011 On-Going Project This project funds essential safety and security renovations and equipment at fourteen (14) local governmental contract jails. These jails require repairs and modifications to continue their operation. Commissioner Antrim noted that this request would provide necessary upgrades at 14 community jails that, while operated by the local community police departments, are under contract to the State. The upgrades would be akin to the upgrades that would be occurring at the State's jail facilities. Co-Chair Green announced that this concludes the Department of Commerce, Community and Economic Development and the Department of Corrections capital project requests. The bill was HELD in Committee.