HOUSE FINANCE COMMITTEE March 31, 2000 8:05 A.M. TAPE HFC 00 - 95, Side 1 TAPE HFC 00 - 95, Side 2 RECONVENED Co-Chair Therriault called the House Finance Committee meeting to order at 8:05 a.m. PRESENT Co-Chair Mulder Co-Chair Therriault Representative Foster Vice Chair Bunde Representative Grussendorf Representative Austerman Representative J. Davies Representative Phillips Representative G. Davis Representative Williams. Representative Moses was absent from the meeting. ALSO PRESENT Chris Christensen, Staff Counsel, Alaska Court System; Wendy Redman, Vice President, Statewide Programs, University of Alaska; Karen Crane, Director, Division of Libraries, Archives and Museums; Nancy Slagle, Director, Division of Administrative Services, Department of Transportation and Public Facilities; Kurt Parkan, Deputy Commissioner, Department of Transportation and Public Facilities SUMMARY OVERVIEW: CAPITAL BUDGET NO COMMITTEE ACTION (The following overview was taken in log note format. Tapes and handouts will be on file with the House Finance Committee through the 21st Legislative Session, contact 465- 2156. After the 21st Legislative Session they will be available through the Legislative Library at 465-3808.) Number 010 UNIVERSITY OF ALASKA WENDY REDMAN, VICE PRESIDENT, STATEWIDE PROGRAMS, UNIVERSITY OF ALASKA provided information on the university's capital budget requests. University of Alaska Small Business Development Programs 450,000 Ms. Redman discussed the request. She noted that there are two centers. This is a state match, which would leverage $2.5 million federal dollars and $2 million dollars in private receipts. Ms. Redman discussed programs that are funded through the request: the Buy Alaska Program and the Technology Transfer Program. She noted that the funds were placed in the capital budget because it is an easier place to secure funds. The University of Alaska received $450 thousand dollars in FY00. The request in FY00 was $500 thousand dollars. Number 227 University of Alaska, Fairbanks - Hutchison Career Center 5,000,000 Ms. Redman discussed the request. She noted that it is a joint project with the Fairbanks North Star Borough. The current space is at its maximum capacity. The expansion will add space for automotive technology and food service. The Borough would pay 60 percent and would be funded through a bond election of $14 million dollars that goes out May 2, 2000. The university's share would be completed with the request. In response to a question by Representative G. Davis Ms. Redman noted that increased revenues would pay increased operating costs. The Career Center has been operating since 1972. Number 459 ALASKA COURT SYSTEM CHRIS CHRISTENSEN, STAFF COUNSEL, ALASKA COURT SYSTEM reviewed the agency's capital budget request. He noted that there are five projects. Acquisition of Automated Case Management System 1,450,000 Mr. Christensen noted that this is their first priority. He observed that the current systems cannot communicate to each other and that there is no interactive financial information. This affects the court's ability to analyze operations. It is also difficult to give timely responses to the legislature; and it makes electronic transfer of information almost impossible. Paper court records are given to other agencies. The current system affects the court's ability to impose proper sentences due to inadequate information regarding previous offenses. This is a two-year project. During the first year funds would be used to procure a software system and licenses. Personal computers already have hardware. In response to a question by Representative G. Davis, Mr. Christensen clarified that they will also need $1,450,000 dollars in FY02. Software packages can be purchased that are 85 percent complete. Co-Chair Therriault observed that basic information could be built in to the package. Mr. Christensen agreed, but pointed out that there are some items that would have to be specialized. Number 663 Mr. Christensen noted that the majority of their PC's are not compatible to a network setup. Representative G. Davis stressed that the collection of surcharges that should be charged, but are not currently being charged would pay for the system. Mr. Christensen noted that the new system could track up to 99 surcharges. He added that the current system cannot track surcharges. Deferred Maintenance Projects 1,500,000 Mr. Christensen observed that there are 14 deferred maintenance projects on the list. The funding would cover items 1 - 6. Court Security Projects 1,000,000 Mr. Christensen stressed the need for security equipment. The request is limited to items that do not require personnel costs. Statewide Court Building Code and Energy Upgrades 400,000 Mr. Christensen noted that there are currently five courts that are not in compliance with the Americans with Disability Act. Records Archival System Upgrade 450,000 Mr. Christensen noted that this is a one-year project. The Alaska Court System is required to keep records. They are now on microfiche. It is time consuming and expensive to comply with requests. The system would create a computer file at the same time records are put on microfiche. Number 916 UNIVERSITY OF ALASKA Representative J. Davies asked if the statewide database could be maintained for $400 thousand dollars. KAREN CRANE, DIRECTOR, DIVISION OF LIBRARIES, ARCHIVES AND MUSEUMS noted that there is a request in the capital budget to give access to full texts through a statewide database. She discussed the request. The item was included in the university regent's request and is ranked high on the list. Representative J. Davies spoke in support of the request and noted that it would only cost .66 cents a person. Representative Phillips agreed and emphasized that it is a good value for the cost. Number 1203 DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES KURT PARKAN, DEPUTY COMMISSIONER, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES reviewed the department's capital budget request. Valdez - Harborview Development Center 150,000 Mr. Parkan noted that a firewall is needed to separate the unused portion from that used by the city of Valdez. This would reduce utility costs. He maintained that it would be a cheaper way to operate. Representative Phillips questioned if the unused portion could be mothballed. Mr. Parkan affirmed and added that there would be a minimal cost in maintaining the mothballed portion. He did not know of any proposals for purchase. Number 1599 Representative Phillips stressed that the state should encourage the transfer of the building. Representative J. Davies asked what the maintenance costs would be for the mothballed portion. Mr. Parkan explained that it would cost between $10 and $15 thousand dollars for the parking lot and miscellaneous costs. NANCY SLAGLE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITATES clarified that the city would take over the payment of the utilities for their side. The state would not pay on the non-mothballed portion. The city would pay $60 - $70 thousand dollars for utilities. If the city took over the rest of the building they would have to pay an additional $10 - $15 thousand dollars. Number 1734 Harbor Programs 6,381,100 In response to a question by Representative Phillips, Ms. Slagle clarified that the funds are not for the transfer of harbors. Funds would be used for the state match to the Corps of Engineer projects and are for harbor expansions. She gave examples of harbor projects. She noted that there are a number of cities, which would take over their harbors if there were a mechanism available for transfer. Representative G. Davis asked if there was a match requirement for the Seward project. Ms. Slagle noted that the state would provide 38% of the non-federal cost share. Representative G. Davis questioned if the Corps of Engineers pays dredging costs. Ms. Slagle did not think that dredging projects were included. Representative Austerman clarified that Seward's harbor was already transferred. Number 1999 State Equipment Fleet Replacement 11,800,000 Co-Chair Mulder questioned the fund source. Ms. Slagle explained that funding would be interagency receipts from the Highway Working Capital Fund. The Fund receives payments for replacement costs from the agencies that use the vehicles. Representative G. Davis noted that the funds are included in the agencies' operating budgets. Mr. Parkan agreed and pointed out that each vehicle has a schedule. Airport Improvement Program  155,823,000 Mr. Parkan observed that Congress recently passed the Air 21 program, which reauthorize the AIP program. This doubled federal funds for airport projects. The state would receive an additional $125 - $135 million dollars. In FY00 the state received $79 million dollars. There is a 7 percent state match requirement to receive 93% federal funding. Ms. Slagle observed that a revised amendment indicates that the International Airport Revenue Fund is $1.979,400 dollars. Number 2209 Mr. Parkan reviewed the breakdown of federal funding. There has been a $500 thousand dollar minimum for small airports. This was doubled to $1 million dollars. Cargo entitlements at international airports were increased threefold. The Alaska supplement was increased to $10.6 - $26 million dollars. There have been other increases. The department expects to get $25 - $30 million in discretionary dollars. Anchorage International Airfield Reconstruction 2,500,000 Number 2275 Mr. Parkan reviewed the request and explained that it would fund general repairs. North/South Parallel Taxiway 10,000,000 Mr. Parkan discussed the request. He observed that the increased federal funds would allow the project to be completed in one phase. Representative Phillips questioned how much of the money covers shortfalls on the Anchorage International terminal project. Mr. Parkan assured her that none of the projects are related to the Anchorage Terminal project. (TAPE CHANGE, HFC 00 - 95, SIDE 2) Number 001 Representative J. Davies referred to passenger facility charges. Mr. Parkan noted that the state is in the process of submitting an amended application for passenger facility charges. He anticipated that the charge would be in affect the first of the year. Representative J. Davies spoke in support. Co-Chair Therriault questioned if the exemption sunset. Mr. Parkan explained that it would continue until it was reauthorized. He estimated that it would be reauthorized in five years. It is an optional exemption. Number 150 Mr. Parkan added that exclusion was added to the reauthorization bill. Aircraft with less than 60 passengers would not have to pay under the exemption. The only routes that would collect the charge are between Fairbanks, Anchorage and Juneau; or these cities and out of state airports. Number 281 Mr. Parkan observed that the exclusion was not requested by the state of Alaska. It is federally mandated. Mr. Parkan added that there is also a population cap on the exclusion of 10,000. Number 400 Co-Chair Mulder referred to the breakdown between airports and roads. He questioned if there is a federal requirement to keep airport and road funds separate. Mr. Parkan responded that they are two different programs and the funds are kept separated. Each program is dealt with differently. The state proposes airport projects to the FAA and the FAA selects projects for approval. The state selects its highway projects and the federal government accepts them. Number 505 Co-Chair Therriault questioned ADA compliance problems in the Anchorage airport. Mr. Parkan responded that ADA projects include: doors, restroom access, and carts. Ms. Slagle observed that the North terminal has a problem. Representative Phillips stressed that duplication needs to be watched. Co-Chair Mulder observed that the timeline on ADA compliance has been extended. Number 633 Mr. Parkan understood that the state of Alaska is required to comply and did not know of a specific timeline for compliance. Representative J. Davies stressed that if the state moves fast enough that it won't get sued. Co-Chair Mulder thought that there was a deadline for the end of the year. Co-Chair Therriault referred to the North/South Parallel Taxiway. Number 745 Mr. Parkan explained that the original component was to construct half of the taxiway. The addition funds would complete the project. It runs the full length of the runway. Representative Phillips pointed out that building a taxiway costs almost the same as building a new school. Co-Chair Therriault noted that the majority of funding would be federal. Number 800 Representative G. Davis noted that projects would provide jobs. Mr. Parkan added that $1 million dollars in new construction results in 8 full time jobs. Representative J. Davies noted that additional maintenance would also add to jobs. Representative G. Davis pointed out that every airstrip that is paved reduces maintenance. Number 932 Mr. Parkan pointed out that maintenance reductions due to paving would be offset by the addition of lights when runways are paved lights. Representative Foster stressed that local hire has been a frustration in rural areas. He observed that there are no union workers in the villages. Mr. Parkan acknowledged the problems. He noted that the Fairbanks union is working on an arrangement to train villagers. Number 1125 Anchorage Deicing Assessment Design 500,000 Representative Phillips questioned if collection and recycling of deicing is being reviewed. Mr. Parkan noted that it is a huge issue and that here is a Deicing Task Force. Anchorage: Areawide Trails Rehabilitation 95,000,000 Representative Foster observed that 10 percent of federal highway funding goes to enhancements. He observed that the projects are mostly urban projects. He asked if funds could be used for boardwalks in villages. Mr. Parkan affirmed that boardwalks would qualify. Co-Chair Therriault questioned the category of funding for boardwalks. Mr. Parkan responded that the funds could be through CPI funds or enhancements. Number 1299 In response to a question by Representative Austerman, Mr. Parkan noted that paths along highways could be considered for enhancement funding. Number 1378 Implementation of Intelligent Transportation System Strategic Deployment Plan 7,500,000 In response to a question by Co-Chair Mulder, Ms. Slagle observed that the federal government provides money, which is earmarked for intelligent transportation systems. She noted that $4 million dollars have already been made available and an additional $3.5 dollars would be available in the next year. They allow sensor mechanisms to monitor weather related roadway conditions. The Thompson Pass area is a difficult area for ice conditions. Mr. Parkan added that T21 put an emphasis on this issue and that there is money that can only be spent on intelligent transportation systems. Number 1510 Representative Foster observed that the old emphasis was new road miles. He questioned if there is more latitude to do maintenance. Mr. Parkan affirmed. Summer maintenance has been shifted to federal projects. He stressed that the state has tapped as much federal funding for maintenance as possible. Representative Phillips questioned if the intelligent systems request would include video cams at the new airport. Ms. Slagle responded that it would not include video cams. Ms. Slagle added that the request includes weigh station technology to allow trucks to be weighed without stopping. Number 1632 Ms. Slagle pointed out that the intent is to find efficiencies. Number 1687 Marine Highway Projects $40,872,000 In response to a question by Co-Chair Mulder, Mr. Parkan clarified that the state match is between 10 and 20 percent. Co-Chair Mulder observed that other roads only require a 9 percent match. Bridges and ferryboat discretionary funds also require a 20 percent match. Representative Williams pointed out that there is an additional $140 million federal dollars, which would be received through the work of Senator Stevens. Mr. Parkan noted that most of the 20 percent items would not have received funding prior to T21. Number 1806 Richardson Highway: Badger Road Interchange 4,000,000 Co-Chair Therriault asked for more information on the request. Mr. Parkan explained that the request reflects increase costs on the project. He thought that the request would cover all of the design and construction dollars. Co-Chair Therriault questioned if there was funding for North Pole off ramps. Mr. Parkan could not respond. Number 1913 Surface Transportation Preconstruction 57,400,000 In response to a question by Co-Chair Mulder, Mr. Parkan noted that the request would cover right-of-way purchases to get projects ready for construction. The request is consistent with previous years. Co-Chair Therriault noted that the weigh scales would have to be moved on the Badger Road 6-mile interchange. Mr. Parkan did not know if there was a new project involved in the request. Watchable Wildlife Signs 240,000 Representative Phillips questioned if the state was required to put up watchable wildlife signs. Mr. Parkan stated that he would check to see if the funds could only be spent on this category. Number 2013 MaCarthy Road 510,000 In response to a question by Co-Chair Therriault, Mr. Parkan explained that the project would go to the river just before McCarthy. There were no further questions. ADJOURNMENT The meeting was adjourned at 9:35 a.m.