SENATE BILL NO. 75 "An Act making and amending appropriations, including capital appropriations, supplemental appropriations, and appropriations to capitalize funds; and providing for an effective date." 10:05:36 AM DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT AMANDA RYDER, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT provided information regarding the department's capital budget requests. Reference No. 40056 Organization Grant $100,000 Ms. Ryder explained that the grant would defray the cost of incorporation for the third and final payment to the city and borough of Wrangell for incorporation as required by statute. Reference No. 38950 Alaska Energy Authority (AEA) Projects $31 million Ms. Ryder explained that the request supports longstanding (mostly federal) grants. The department expects $4 million in federal funds from the Denali commission for bulk fuel upgrades to replace tank farms with new refurbished facilities that meet all applicable safety and environmental standards. The program began in 1997 and has expanded since FY 99 with federal Denali Commission funds. When the work began there were 1,100 above ground tank farms in 171 remote communities. She explained that $30 million is needed to complete the upgrades for the remaining 25 communities on the list. Co-Chair Stedman asked for a list of the communities. Ms. Ryder agreed to provide a list after the meeting. 10:09:08 AM In response to a question by Co-Chair Stedman, Ms. Ryder observed that Alterative Energy grants were included in the request because they are part of AEA's energy projects. The Alternative Energy and Energy Efficiency program is a long standing federal program that receives grants for diesel generation, hydroelectric project development pass through federal grants, wind energy, biomass geothermal, ocean energy and energy cost reduction. The program does not deal with the renewable energy grant projects that are funded from the $100 million dollar fund created by the legislature. Ms. Ryder observed that the request also includes: $7 million for Rural Power System upgrades from the Denali Commission, $1 million to develop the statewide Alaska Energy Plan, and $2 million for Renewable Energy Grant Fund projects. No state match is required for the Denali Commission projects in this request. Reference NO. 47877 AEA - Denali Commission $10 million Match for rural power system upgrades Ms. Ryder explained that the funding would come from the Capital Income Fund. The Denali Commission asked the state to provide a match to what had been 100 percent federally funded projects. 10:13:41 AM Reference No. 38946 Community Block Grant $6.1 million. Ms. Ryder observed that the request contains $6,030.0 million in federal funds and $70 thousand in general funds for grants to improve the quality of life for low income rural Alaskans through RurAL CAP a non-profit community agency. The request also includes funding for Food and Nutrition Grants, Community Development Block Grants, and Emergency Shelter Grants. Reference No. 47006 Grants Tracking System $255 thousand Ms. Ryder observed that the grants tracking system would provide software to assist the department with its tracking of grants and expand reporting capacity. Co-Chair Stedman assumed that the requests were ranked in a priority order. Ms. Ryder was uncertain but offered to report back. 10:16:15 AM Reference No. 41789 Kodiak Launch Complex Infrastructure $17.5 million Ms. Ryder explained that $14 million of the request would come from federal funds. The remaining $3.5 would be general funds. This is the second year appropriation to build a dedicated rocket motor facility and an additional launch pad, which would allow multiple launches. Reference No. 40242 Manufacturing Extension Program $806,401 Ms. Ryder highlighted the request which would support the federal program set up to support small and medium manufacturers. The request funds the state's third of the project. 10:18:08 AM Reference No. 38943 Community Development and Assistance $2.63 million. Ms. Ryder observed that the general fund portion would be $430 thousand. The request supports multiple federally- funded programs providing grants and development opportunities and assistant to communities and non-profits for community development. The request includes funding for the Alaska Floodplain and Erosion Management program, business development, and the Coastal Zone Management program. Reference No. 47007 Licensing MyAlaska Integration $310 thousand Ms. Ryder noted that the project goal is to integrate each of the division's on line applications so that users do not have to apply for separate ID's and passwords. She concluded that the project would offer greater security and ability to view accounts online. Reference No.47878 Denali Commission Match/Rural Transportation $5 million Ms. Ryder explained that the funding would come from the Capital Income Fund. The purpose of the request is to assist the Denali Commission's effort to fund cost effective road construction and waterfront development projects in rural Alaska. The request would benefit rural Alaska by reducing the cost of goods and services, improving village to village connections, providing access to resources, and helping to create jobs and economic development. She observed that there is 30,000 miles of shoreline and that Alaska's marine facilities are an integral part of local, statewide, and international transportation of goods and services. The Denali Commission previously funded 100 percent of these projects but has requested state participation. 10:20:56 AM Reference No. 47847 Shishmaref Beach Erosion $3 million Ms. Ryder observed that the request funds phase III of a four phase project. This phase would construct 550 feet of ocean side protection for the washeteria and sewage lagoon. She noted that phases I and II are complete. Co-Chair Hoffman asked if these improvements would prevent relocation of Shishmaref. Ms. Ryder understood that the project would provide Shishmaref with time to plan. She did not know how much time the project would buy. 10:22:51 AM Reference No. 47987 Kenai River Bluff Erosion Project $5 million Ms. Ryder explained that the request is the result of erosion and is the number one priority for the city of Kenai. The total cost of the project is $20 million ($13 million in federal funds). The local match is $2 million. This request provides the state's portion. Reference No. 41956 Municipality of Anchorage $10 million Expansion of the Port of Anchorage Ms. Ryder observed that the Port of Anchorage serves 80 percent of Alaska's population and is the entry point of 90 percent of the consumer goods shipped to Alaska. The port is securing funding of $350 million to $400 million through a combination of state, federal and local resources. The total federal cost is 52 percent; 48 percent would come from state grants, port retained earnings and loan proceeds. The state has so far appropriated $55 million for this purpose. Reference No. 47879 Alaska Marine Exchange 0 Ms. Ryder clarified that the governor removed this item that would have expanded the vessel tracking system due to the state's fiscal situation. 10:25:40 AM Co-Chair Stedman noted that the original request for the marine exchange system was $650 thousand and questioned if the cruise ship head tax would be an appropriate fund source. Ms. Ryder was unable to answer but offered to discuss the issue with OMB. Co-Chair Stedman questioned if deletion of the request would impact cruise ship tracking and monitoring of discharge. He asked if other areas would be increased and questioned the long term "deal" with the transmitter network of the Alaska Marine Exchange. He wanted to ascertain if the deletion was temporary. Ms. Ryder responded that she was unable to comment on the policy issues behind the deletion but offered to talk with OMB. 10:28:35 AM Reference No. 38713 Arctic Power $120 thousand Ms. Ryder explained that the grant would support eduation efforts in opening up ANWR for oil and gas exploration and development. Reference No. 41959 Arctic Winter Games Team Alaska $250 thousand Ms. Ryder clarified that the request would support participation in the 2009 Arctic Winter Games. Reference No. 38948 NPR-A Impact Grant Program $15,967,840 Ms. Ryder explained that the request funds fifteen grants to communities impacted by oil and gas lease sales and development within the National Petroleum Reserve of Alaska. Co-Chair Stedman asked about a list of the grants and applications that were not funded. Ms. Ryder agreed to provide the list and pointed out that the grants were ranked. Co-Chair Hoffman asked the reason for the amendment that reduced the request by $7 million. 10:31:40 AM Ms. Ryder answered that one of the lease sales did not occur. The appropriation was based on the actual lease sales. Co-Chair Stedman reiterated his request for a list of grant applications that were declined. Reference No. 47031 Electrical Emergencies Program $250 thousand Ms. Ryder clarified that the request is a long standing AEA program that funds technical support when an electrical utility has lost or is in danger of losing the ability to generate power, creating a situation that is a threat to health, life and/or property. A language appropriation is also included to reappropriate the cash balance of the Rural Electrification Revolving Loan Fund ($80.4 thousand). The total cost would be $330.4 thousand. Reference No. 45662 Climate Change Impact Mitigation Program $300 thousand Ms. Ryder explained that the program provides planning assistance to the most at risk villages and provides a planned approach to shoreline protection, building relocation and/or the eventual relocation of the village. The request would fund approximately five grantees. 10:33:59 AM Reference No. 47898 Cruise Ship-Related Grant Projects $22.54 million. Ms. Ryder noted that the grants to municipalities use the Cruise Ship Impact Fund. The Department of Transportation and Public Facilities worked with the department to rank and review the projects based on need and cruise ship industry impact to the communities and specific projects. Co-Chair Stedman asked for more information on the process used to collect and rank projects. Ms. Ryder observed that OMB outlined the ranking process in a letter dated February 26, 2009. The Department of Transportation and Public Facilities gathered project information and prioritized projects based on OMB's letter. Co-Chair Stedman did not see Petersburg on the list. Ms. Ryder did not know which communities had proposals. Co- Chair Stedman asked for more information on the pool of requests and ranking. He observed that there are still some funds available and noted that some projects requested in the previous year were not funded. He asked for any information provided by the industry that was used in ranking with the objective to keep the industry in the loop in regards to the selected grants project. He pointed out that Fairbanks and Anchorage receive cruise ship visitors. 10:37:56 AM OFFICE OF THE GOVERNOR Reference No. 47009 Banking and Securities Imaging $580 thousand Ms. Ryder added that a number of the department's information and technology projects were placed under the Office of the Governor. She observed that an imaging project for the Banking and Security Management System remains. The project uses an imaging system previously developed for the Division of Insurance as a base for the new project. Imagines are currently stored in hard copy format. The request would improve document accessibility and eliminates the cost of paper. Ms. Ryder discussed the items that were deleted. Reference NO. 47005 Community and Regional Affairs Imaging $690 thousand Ms. Ryder observed that the request was deleted due to the state's fiscal situation. Reference NO. 47010 Banking and Securities Management System $890 thousand Ms. Ryder explained that the request was removed due to an incident that convinced the administration to start on the project prior to FY 10. The request encompasses systems that address STAR, ANCSA and Native corporations. The STAR system was deemed at risk and the request was added to the supplemental appropriation. Co-Chair Stedman observed that the intent was to remove capital from the supplemental. 10:42:10 AM Co-Chair Stedman suggested that the department's request be stacked in priority order. Co-Chair Stedman asked for information regarding applications for climate impact mitigation funding. Ms. Ryder noted that applications were ranked by the department but did not know how the applications were submitted. She observed that some applications have been returned for more information. 10:45:04 AM Co-Chair Stedman referred to economic stimulus funding for the department. Ms. Ryder observed that requests for economic stimulus funding would be made for longstanding, existing programs. Co-Chair Stedman observed that the issue would be given further review. 10:46:46 AM