SENATE BILL NO. 46 "An Act making capital appropriations and appropriations to capitalize funds; and providing for an effective date." This bill had previously been heard in the Senate Finance Committee. GINGER BLAISDELL, Staff to Co-Chair Green, prefaced her remarks by stating that the committee substitute work draft, Version 24- GS1074\F, being explained would require additional amending to correct spelling and other errors. Requests from Legislators are continuing to be incorporated. Ms. Blaisdell stated that the first 72 pages of Version "F" list "standard" capital budget projects, broken out by agency. Sec. 4, page 73 through page 88, would address the projects that are also included in SB 155-APPROP: SCHOOLS/UNIV/VIROLOGY LAB/MUSEUM. The introductory language in SB 46 specifies that were SB 155 to fail passage, the projects included in that bill would be funded by general funds (GF) rather than by the Permanent Fund Earnings Reserve Account as specified in SB 155. She pointed out that the lone difference between the language in SB 155 and that of Sec. 4 is that SB 155 has a "general appropriation of $141,000,000 for school maintenance projects", whereas SB 46 identifies each project by school name. 2:17:54 PM Co-Chair Green stated that that would account for the number of pages in the section. This detailed information would be helpful to Legislators. 2:18:02 PM Ms. Blaisdell stated that the list includes each school that was identified on the Department of Education and Early Development's maintenance list. A few other school projects were also included. Ms. Blaisdell noted that Sec. 6 on page 89 would address those projects that would funded by the interest earnings of the Amerada Hess Fund in the Permanent Fund via the Alaska Capital Income Fund. There would be a few corrections to this list, as it had been developed from an older list version. 2:18:42 PM Ms. Blaisdell commented that the majority of the projects in Sec. 6 were included in Governor Frank Murkowski's transportation initiatives and Roads to Resources endeavor. 2:19:00 PM Ms. Blaisdell stated that Sec. 7 on page 89 contains "standard language" that is included in every capital bill. It would include such things as federal program receipts. This section would also include language pertaining to projects that were originally included in SB 97-SUPPLEMENTAL APPROPRIATIONS/CBR. Ms. Blaisdell pointed out that the Alaska Gas Pipeline project is included in the bill on page 94. That project had been previously vetoed in the Fast Track Supplemental bill. 2:20:05 PM Ms. Blaisdell continued that Reappropriations, which are listed by House District, are included in Sec. 36 beginning on page 104. Most of these were projects that were "highlighted" to Committee Members by the Department of Commerce, Community and Economic Development. 2:20:39 PM Co-Chair Green conveyed that that is the traditional procedure for any money that has not been utilized. 2:20:52 PM Ms. Blaisdell stated that a reappropriation could consist of any money that had been appropriated in an earlier fiscal year and is being reappropriated into a following fiscal year. The funds could be reappropriated to support an entirely different use. These funds could include such things as extended lapse dates or scope of project changes. 2:21:09 PM Co-Chair Green communicated that the reappropriation projects would provide for projects "across the State and every district probably has something going …" either at the request of the district or a department. 2:21:24 PM Ms. Blaisdell mentioned that the projects prefaced by "House District are typically" advanced by the Department of Commerce, Community and Economic Development. 2:21:39 PM Ms. Blaisdell communicated that a few projects that were included in the Supplemental Bill are provided for in the Appropriations sections of the bill. 2:22:00 PM Ms. Blaisdell stated that the final pages of the bill contain contingency language to the effect of specifying that, were SB 155 to fail, money for the projects in that bill would be provided for through this bill. In other words, language in this bill would negate duplication of funding those projects specified in SB 155 were SB 155 to pass. Similar language is included in regards to the Amerada Hess Capital Income Fund projects. 2:22:31 PM Ms. Blaisdell concluded her testimony by specifying that lapse dates and effective dates are included in the final sections of the bill. 2:22:36 PM Co-Chair Green pointed out that, other than the inclusion of the Amerada Hess interest earning projects, this bill would be characterized as a typical capital budget bill in regards to its fund sources. 2:22:53 PM Ms. Blaisdell concurred. Efforts were made to provide a fairly traditionally formatted bill. "Past precedence" was adhered to as much as possible. 2:23:08 PM Co-Chair Green asked whether some of the items she had mentioned in her initial review of Version "F" had been altered. 2:23:14 PM Ms. Blaisdell clarified that the contents of Version "F" have not been changed. The work draft does contain some typographical errors and incorrect numbers; corrections are being made and a corrected committee substitute would be provided. 2:23:36 PM Co-Chair Green asked Members to communicate any corrections they might find to Ms. Blaisdell. Ms. Blaisdell expressed that she had identified ten items requiring corrections. In addition, the Division of Legislative Finance is addressing changes relating to Legislators' requests. 2:24:34 PM Senator Hoffman asked whether a capital budget total has been determined. Co-Chair Green replied that a total has not yet been determined. 2:24:45 PM Senator Dyson asked regarding language in Sec. 12, page 91, lines 12 and 13. 2:25:28 PM Co-Chair Green responded that that language is standard in every piece of legislation pertaining to marine vessels; specifically it would allow for vessel retrofitting. 2:26:07 PM Senator Dyson asked whether that language could be used as "a loophole". 2:26:13 PM Co-Chair Green replied "absolutely". 2:26:20 PM Ms. Blaisdell stated that the language in question typically pertains to Department of Public Safety and Department of Fish and Game vessels. She noted that "the average amount for the sale and resale" of those vessels is $250,000 to $300,000 per year. 2:26:42 PM Senator Olson asked the reason that this loophole is not closed. 2:26:52 PM Co-Chair Green responded that with a fleet, over the course of a year, it might be necessary to discard and/or sell parts. Some of the resulting income might be used to rehabilitate or refurbish another vessel, airplane, or helicopter in the fleet. This language is the traditional language in this regard. She stated that Senator Olson, being an airplane owner, would understand this. 2:27:26 PM Senator Olson voiced being aware of the issue. However, his concern is that, as aircraft are sold and new ones bought, the situation builds on itself. This is evidenced by the request for a new hangar. That hanger would be filled, and then another hangar would be required. He disagreed with such progression. Co-Chair Green asked whether the concern is in regards to the fact that increasing the number of aircraft in the fleet would require a hangar. Senator Olson stated that his concern pertained to the Department of Public Safety request for a hangar that was in excess of $6,000,000. That hangar would be filled and then another hangar would be requested. This cycle would continue to escalate. Co-Chair Green asked whether Senator Olson had observed a request for a six million dollar hangar in this legislation. Senator Olson responded that his concern is to "the mentality on that absurd request". 2:28:55 PM Co-Chair Green reiterated that the language in question is identical to that of previous bills. It would allow for the continuance of efforts. To that point, she stated that it would also support the efforts being exerted by the Governor Murkowski Administration in regards to reducing the number of aircraft and marine vessels in State operations. Some would argue that there is an insufficient number of aircraft and vessels in State service. Others would argue that there are too many. 2:29:17 PM Co-Chair Green asked whether there were any other Committee questions or concerns. None were forthcoming. Co-Chair Green reiterated that a new committee substitute is being developed. 2:29:36 PM Ms. Blaisdell specified the timeframe in which Members could communicate any "technical corrections" to her. Members' amendments that might incur significant changes to the bill could be developed with the assistance of Members' own staff or with the Division of Legislative Legal and Research. 2:30:11 PM The bill was HELD in Committee. 2:30:27 PM