HOUSE FINANCE COMMITTEE February 16, 1993 1:37 p.m. TAPE HFC 93-23, Side 1, #000 - end. TAPE HFC 93-23, Side 2, #000 - end. TAPE HFC 93-24, Side 1, #000 - #235. CALL TO ORDER Co-Chair Larson called the House Finance Committee to order at 1:37 p.m. PRESENT Co-Chair Larson Representative Hoffman Co-Chair MacLean Representative Martin Vice-Chair Hanley Representative Navarre Representative Brown Representative Parnell Representative Foster Representative Therriault Representative Grussendorf ALSO PRESENT Representative Ellis; Janice Adair, Assistant Commissioner, Department of Environmental Conservation; Dick Marcum, Environment Conservation Manager, Municipal Grants Section, Department of Environmental Conservation; Gregory Capito, Environmental Manager, Village Safe Water Section, Department of Environmental Conservation; Lloyd F. Hames, Commissioner, Department of Corrections; Steve Schwartz, Research Analyst, Department of Corrections; Kathy Cristy, Facilities Planner, Department of Corrections; Jerome Komisar, President, University of Alaska; Marsha Hubbard, Director of Budget, University of Alaska; Arthur H. Snowden, II, Administrative Director, Alaska Court System. SUMMARY INFORMATION HB 60 "An Act making appropriations for capital projects; and providing for an effective date." OVERVIEWS: University of Alaska Department of Environmental Conservation Department of Corrections Alaska Court System UNIVERSITY OF ALASKA 1 JEROME KOMISAR, PRESIDENT, UNIVERSITY OF ALASKA gave a brief overview of the University of Alaska's FY 94 capital improvement project (CIP) requests. He provided members with list of the University's CIP requests (Attachment 1). He noted that the University's CIP requests are divided into seven categories: * Code - $6.672.0 million dollars; * ADA Compliance - $5.0 million dollars; * Deferred Maintenance - 5 year plan - $33,737.0 million dollars; * Building Completions - $24,700.0 million dollars; * Equipment - $8.088.0 million dollars; * Construction for Growth $25,850.0 million dollars; * Planning for Growth - $2,978.0 million dollars; * Governor's Additions. President Komisar noted that the first four categories are restricted in choice. He noted that the first category will bring facilities into legal code compliance. Category two will bring facilities into compliance with the Americans With Disabilities Act. The third category would address the $150 million dollar backlog in deferred maintenance. He explained that the University has designed a five year program to resolve the deferred maintenance problem. The fourth category will complete buildings under construction. President Komisar discussed capital improvements the University has undertaken without state aid. He noted that the University has purchased a building in Anchorage for classroom and administration use. The University is examining means to build a research building in Fairbanks based on federal funding. The University is seeking additional funding for dormitories through the private sector. Co-Chair MacLean noted that the University's $6,672.0 request for code compliance was reduced by the Governor. President Komisar relayed that the University will attempt to complete repairs with the reduced funding. Representative Martin asked if the Butrovich building will be completed. President Komisar anticipates that the Butrovich building will be completed if the FY 94 request is appropriated. Representative Martin asked if student fees will be used to match funding for the Super Computer Center. President Komisar assured him that student fees will not be used to fund the Center. 2 Representative Therriault asked if the University should acquire land in Homer when it is not in a position to expand. President Komisar clarified that the University already has a facility adjacent to the proposed land acquisition. He emphasized that the University would expand the existing facility. He added that the Homer facility has more use per square foot than any facility in the University. Representative Hoffman noted that the Governor reduced the University's $3,550.0 million dollar request for fiber optics equipment at the UAA campus. He asked how the University will spend the remaining funds. President Komisar replied that fewer buildings will be included in the system. MARSHA HUBBARD, DIRECTOR OF BUDGET, UNIVERSITY OF ALASKA added that the University will build a spur from each hub to connect buildings East to West but not North to South. President Komisar noted that the University will return with requests for the remaining funding. Representative Brown asked if the University performed a cost benefit analysis on the fiber optics system. President Komisar replied that they did not complete a cost benefit analysis. He added that alternatives were considered. The University concluded that the fiber optics network would be the best alternative. Co-Chair Larson noted that the Governor is requesting $219.0 thousand dollars for the Nature Conservancy of Alaska. Ms. Hubbard added that $464.10 thousand dollars for contaminated site assessment and cleanup was also included under the Governor's request. She noted that funding for the Nature Conservancy has been included in the capital budget during the last three fiscal years. This represents half of their budget. Representative Therriault questioned the contaminated site request. He asked what justified funding for the request from the 470 Fund. Ms. Hubbard replied that the site is located on the equipment yard of the fiscal plant at UAF. It was contaminated by leaking fuel tanks that were removed in the 1980's. The Department of Environmental Conservation will remove contaminated soil. The contaminated water will not be addressed at this time. Co-Chair MacLean asked the effect of the $1 million dollar reduction to space renovation. President Komisar noted that less space will be renovated. 3 Co-Chair MacLean noted that the Governor reduced the University's request for Aviation Technology construction by $8 million dollars. President Komisar replied that the building will not be constructed. A planning assessment will be completed. A general fund match is required for federal construction funds. President Komisar spoke in support of the request. He noted that the University trains air controllers. Co-Chair MacLean asked if the University could accomplish the UAA library planning. President Komisar replied that further expertise is needed. Representative Brown asked if the University plans any closures and how would it dispose of capital assets if closures occur. President Komisar replied that the University has no plans to close facilities. He stressed that the most difficult aspect of a closure would be in acquitting the University's responsibilities to students and employees. He noted that Universities are seldom closed and may be sold. Representative Therriault asked if the contaminated tanks were removed with 470 Funds. Ms. Hubbard could not answer. The Department of Environmental Conservation suggested that the University seek funding through the 470 fund. She noted that a recycling water system was developed with a FY 93 appropriation. DEPARTMENT OF ENVIRONMENTAL CONSERVATION DICK MARCUM, ENVIRONMENTAL CONSERVATION MANAGER, MATCHING GRANTS SECTION, DEPARTMENT OF ENVIRONMENTAL CONSERVATION discussed the 50 percent Matching Grant Program. He noted that the program was created to provide funding for construction of water, waste water, and solid waste facilities in larger communities. Funding is primarily for first class communities. Communities must provide 50 percent of construction funds. Projects are ranked based on a questionnaire communities complete. Projects are evaluated and scored. The Governor's office receives a list of projects as ranked by the scoring process. The Village Safe Water Program addresses the needs of communities that cannot provide a match. JANICE ADAIR, ASSISTANT COMMISSIONER, DEPARTMENT OF ENVIRONMENTAL CONSERVATION discussed the Department's CIP requests. She identified the projects: * Municipal Matching Grants - $16,152.1 million dollars will fund 10 of 12 projects. 4 * Village Safe Water - $25,985.1 million dollars will fund 38 of 41 projects. Partial funding is included for administration. $500.0 - for preliminary planning and evaluation. $500.0 - water and sewage service for health clinics. * Solid Waste Planning Grants - $150.0 thousand dollars is a shift from the operating and to the capital budget. * Data Processing Hardware & Software Replacement - $300.0 thousand dollars will up grade personnel computers. * Cooperative Environmental Research & Development - $160.9 thousand dollars will be used in partnership with the University of Alaska, $63.4 thousand dollars - Paralytic Shellfish Poisoning (PSP) Toxins, $97.5 - Lab Instrument Methodology for heavy trace metals Ms. Adair explained that PSP in crab has caused some products to be embargoed before shipment. She observed that the problem exists along the West Coast. She emphasized that tests will be administered in the field. The time the product must be held would be reduced by three to four days. Ms. Adair noted that the Department of Environmental Conservation commonly needs to perform hard metal research. She observed that conducting heavy metal research with the University of Alaska is a natural partnership. Ms. Adair continued to outline the Department's CIP requests: * Impaired Waterbody Assessment - $300.0 thousand dollars is the second year of a three year project. 39 water bodies must legally be brought into compliance. * Northern Panhandle Household Hazardous Waste Removal -$34.1 thousand dollars will dispose of collected waste. * Community Hazardous Waste Storage and Transfer Facility - $260.0 thousand dollars will establish a fixed transfer system in Prince William Sound and Southwest. The communities will be responsible for operation costs. * Laboratory Operations Instrument Acquisition & 5 Installation - $120.0 thousand dollars will purchase equipment for EPA and OSHA requirements. * Satellite Data Telemetry Development - $125.0 thousand dollars to establish at the Pokerflats, Fairbanks facility sensors to connect with satellite and monitor remote water bodies. Representative Martin noted that $25 million dollars were appropriated to Village Safe Water (VSW) in FY 93. Ms. Adair noted that the grant program is similar to the Municipal Matching Grant Program described by Mr. Marcum. (Tape Change, HFC 93-23, Side 2) GREGORY CAPITO, ENVIRONMENTAL MANAGER, VILLAGE SAFE WATER SECTION, DEPARTMENT OF ENVIRONMENTAL CONSERVATION gave a overview of the VSW program. He noted that the program was established by statute in 1972. It provides planning, design, engineering and construction services for communities without public works departments. Services are provided to first class cities with populations under 600, second class communities and unicorparated areas of with populations of between 600 - 2,500 people. Projects are begun with a feasibility study. Alternatives are researched. Department of Environmental Conservation staff work with village councils and communities. Representative Martin asked if all villages would be completed if appropriations continued at the same level for the next two years. Mr. Capito clarified that about a third to half of the projects are continuations from previous years. He anticipated that the growth of communities would necessity the projects existence beyond five years. He emphasized that federal funds have increased the program's appropriations. Representative Hoffman asked the status of Primacy in the State. Ms. Adair clarified that the Environmental Protection Agency (EPA) has notified the State of Alaska that it will withdraw the program in thirty days if surface drinking water regulations are not to the Governor. The regulations should have reached the Governor on February 16, 1993. If the State does not comply administration of the program will return to EPA. The State receives federal funding for the drinking water program. Representative Hoffman asked the Department's long range plan for VSW and the Municipal Matching Grant program. Mr. Capito referred to the Alaska Sanitation Task Force. He observed that the Task Force published, "A Commitment to Alaska." He noted that the Task Force projected CIP 6 requests for the next five years. He stressed that Native and rural groups have reviewed and endorsed the projected CIP requests. He pointed out that the current CIP request exceeds recommendations by the Task Force. Representative Brown asked how reductions in the Department's Community Hazardous Waste Storage and Transfer Facilities request would effect the projects. Ms. Adair clarified that the communities would need to scale back their plans. The funding would be split evenly between the communities. The project is new. The general household hazardous waste cleanup is a separate program and will continue. Representative Brown referred to the Satellite Data Telemetry Demonstration Project. She noted that the Master Transceiver Set is listed at $125.0 thousand dollars. Representative Grussendorf observed that Anchorage Municipal Matching Grant projects are not scored. They are listed as unspecified. Mr. Marcum noted that the Municipality of Anchorage, Governor's Office and Legislators met with the Department in regards to the difficulty of scoring projects which cross district lines. It was decided that projects would be ranked by the Municipality. Representative Brown observed that the projects are unranked but eligible for participation. Co-Chair MacLean asked about unspecified Solid Waste Planning Grants. Ms. Adair clarified that the Department will solicit applicants when the Department knows how much money will be available. Co-Chair MacLean required more information regarding VSW, Preliminary Planning Project. Mr. Capito observed that some communities have additional problems which need to be addressed in order to ensure that a water or sanitation solution can be successful. The Department proposes to send a team of experts to assist communities. Some of the experts would be personnel of the Department of Community and Regional Affairs. The communities may receive assistance in budgeting, accounting and utility management. A profile of the community will aid VSW engineers to design a facility the community can operate, maintain and manage. Mr. Capito noted that local government specialists within the Department of Community and Regional Affairs have developed a concept called Remote Utility Business Advisors (RUBA). The Department of Environmental Conservation hopes to RSA funds to the Department of Community and Regional Affairs for RUBA activities. The Governor's reduction would cut the amount available for RUBA support. 7 Mr. Capito explained that the Department of Health and Social Services would also be involved in working with communities' health and hygiene education and headstart programs in elementary schools. Children will be taught the connection between water born disease such as hepatitis A and hygiene. Co-Chair MacLean noted that the Department's backup states, "Once we are convinced that a village has the capability to protect the State's capital investment, we will include a request for funding in a subsequent capital budget submittal." She asked if this will impact communities that do not have the ability to pay. Mr. Capito pointed out that the Department has instituted a pilot project called the Local Utility Matching Program in the Northwest Arctic. The program looks at options to generate local revenue to provide the level of service necessary and commensurate with the community's ability to pay. He stressed that no current projects would be eliminated due to their inability to pay. Co-Chair MacLean asked if the Department's request for $300.0 thousand dollars, Data Processing Hardware and Software Replacement, has been through TIC review. Ms. Adair clarified that the request has been submitted to TIC and is part of the statewide management plan. Ms. Adair explained that newer versions of software are incompatible with the older computers. ALASKA COURT SYSTEM ARTHUR H. SNOWDEN, II, DIRECTOR, ALASKA COURT SYSTEM noted that only two of the Alaska Court System's CIP requests were approved by the Governor. He mentioned projects not included by the Governor: * Fairbanks Courthouse Renovation, * Kodiak Courthouse Renovation, * Kotzebue Facility Repairs, * Law Library - Earthquake Bracing, * Juneau Courthouse Renovation, * Americans with Disability Act Compliance. Mr. Snowden pointed out that the HB 60 contains funding requests for the Anchorage Courthouse Phase II and Court Technology Enhancements. Mr. Snowden stressed that the old Anchorage Courthouse has tremendous problems. The request will construct the modified version of the Anchorage Courthouse. He stressed that the courthouse will be full upon completion. He 8 clarified that forward funding is needed to allow the bid to be completed. He clarified that the bid was broken into components to allow Alaskan bidders. Reduced appropriations would result in a one year delay and increased costs. Mr. Snowden discussed the earthquake potential of the Anchorage Courthouse District Building. He observed that the building was built in 1962 and was weakened by the 1964 earthquake. He stated that the old building will be demolished. Mr. Snowden noted that the Alaska Court System's request for Technology Enhancements would continue the FY 93 capital appropriation. Personal computers will replace mainframe connections. Personal computers provide backup technology. Funds would also be used for electronic imaging. He stressed that the Alaska Court System must retain records indefinitely. In addition, a portion of the request is for a pilot Computerized Litigant Assistance System ($35.0 thousand dollars). The system would be used to assist the public in filling small claims cases. DEPARTMENT OF CORRECTIONS LLOYD H. HAMES, COMMISSIONER, DEPARTMENT OF CORRECTIONS noted that the Department has eight CIP requests. He discussed the first project, Agricultural Rehabilitation Program (Operation Hope) for $1,750.0 million dollars. He noted that the State owns four farms in the Matanuska Valley. The Department of Corrections intends to redevelop the farms using relocatable buildings for inmate housing and support services. Representative Brown questioned the wisdom of further investment in the farms. She noted that the Department intends to sell the farms after redevelopment at a low price to the private sector farming interest. Commissioner Hames clarified that the Department's primary concern is in targeting young offenders for skill advancement. He observed that no major site development would be needed. He stressed that the properties are depreciating and the project could enhance their value. Representative Brown asked for further information. Representative Larson felt that the Point MacKenzie farms failed due to debt overhead. He expressed concern that the improvements to the land not be wasted. Commissioner Hames stressed that the farms are in close proximity to the Palmer Correctional Facility. The Palmer Correctional Facility could provide access to heavy equipment to maintain the property. The Palmer facility also contains a large vehicle maintenance shop. 9 Co-Chair MacLean asked how the Department's request of $1.5 million dollars for a Special Purpose Facility - Anchorage, fits into the master plan. KATHY CRISTY, FACILITIES PLANNER, DEPARTMENT OF CORRECTIONS gave a brief overview of the Department's Special Purpose Facility request. She noted that the request would fund the initial phase of programming, design and site development of a facility to meet the needs of three segments of the inmate population. (Tape Change, HFC 93-24, Side 1) Ms. Cristy noted that the proposed complex will provide: * 104 bed full-service facility for women * 60 beds for the mentally ill * 30 beds medical/geriatric facility Ms. Cristy stressed that the project would increase efficiency for care of mentally ill offenders at a centralized corrections facility. She noted that the project would allow the State to meet Cleary requirements. She observed that high security women offenders currently housed outside of the State would be returned. She emphasized that a new women's facility is a critical step toward closing the Sixth Avenue facility. She underscored the importance of the facility to the master plan. She noted that funding within the Department of Health and Social Services would only address acute care of mental health offenders. The total construction cost will be approximately $25 million dollar. Representative Brown recalled that Commissioner Hames assured members during House Finance Committee Budget Subcommittee hearings that there would be no new facilities. She asked if $500.0 thousand dollars appropriated in FY 92 to the Department was for design. Commissioner Hames clarified that the special purpose facility is not a new facility. He stated that the beds will be provided by a satellite to an existing facility. He stressed that food service and other needs will be provided through the existing facility. Ms. Cristy explained that the $500.0 thousand dollars the Department received in FY 92 was for the master plan. Co-Chair MacLean asked if the Department's Management Information System request has received Telecommunications Information Council (TIC) review. 10 STEVE SCHWARTZ, FINANCIAL MANAGER, DEPARTMENT OF CORRECTIONS pointed out that the project will be given to TIC for approval after the Information Systems Projects Review Committee in the Department of Administration (ISPRC) review. Co-Chair MacLean asked when the system assessment will be completed. Commissioner Hames stated that the assessment will be accomplished after the first of the fiscal year. Co-Chair MacLean felt that the assessment should be completed before the request is appropriated. Commissioner Hames spoke in support of the Department's request for $1.5 million dollars for a Management Information System. He noted that several offices do not have access to the current system. Representative Brown spoke in support of a coordinated data base for the entire criminal justice system. Commissioner Hames assured her that the Department is involved in a working group aimed at achieving a unified data base. ADJOURNMENT The meeting adjourned at 2:35 p.m. 11