MINUTES SENATE FINANCE COMMITTEE April 30, 1993 6:40 p.m. TAPES SFC-93, #70, Side 2 (150-end) SFC-93, #72, Side 1 (000-end) SFC-93, #72, Side 2 (end-050) CALL TO ORDER Senator Drue Pearce, Co-chair, convened the meeting at approximately 6:40 p.m. PRESENT In addition to Co-chairs Pearce and Frank, Senators Kelly, Kerttula, Rieger, and Sharp were present. Senator Jacko arrived while the meeting was in progress. ALSO ATTENDING: Shelby Stastny, Director, Office of Management & Budget, Office of the Governor; Cheryl Frasca, Division Director, Division of Budget Review, Office of Management & Budget, Office of the Governor; Brian Rogers, Vice President for Finance, University of Alaska; Mike Greany, Director, Karen Rehfeld, Joan Kasson, and Dave Tonkovich, Fiscal Analysts, Legislative Finance Division; and aides to committee members. SUMMARY INFORMATION SB 50 - An Act making appropriations for capital projects; and providing for an effective date. Amendments 1 through 39 were offered and ADOPTED, except for amendments 12, 14 (which was combined with 19), 36, and 38 which FAILED. Amendments 16, 21, 22, and 35 were withdrawn. CSSB 50(FIN) as amended was REPORTED OUT of committee with a "do pass." Senators Rieger, Jacko, Sharp, Kelly and Co-chairs Frank and Pearce signed "do pass." Senator Kerttula signed "no recommendation." SENATE BILL NO. 50: An Act making appropriations for capital projects; and providing for an effective date. CO-CHAIR DRUE PEARCE announced that CSSB 50(FIN) work draft "E" dated April 29, 1993. SENATOR TIM KELLY MOVED for ADOPTION of CSSB 50(FIN) work draft "E" dated April 29, 1993. SENATOR JAY KERTTULA OBJECTED for clarification. After a short discussion, Senator Kerttula withdrew his objections. No further objections having been raised, it was ADOPTED. Co-chair Pearce announced that amendments would be numbered and considered in order. SENATOR STEVE RIEGER MOVED for ADOPTION of amendment 1, inserting a new section to read," Sec. 6. The appropriations made by this Act are for capital projects and lapse under AS 37.25.020." Senator Rieger clarified that the words "and lapse under AS 37.25.020" means that it does not automatically lapse at the end of the fiscal year. No objections having been raised, amendment 1 was ADOPTED. Co-chair Pearce explained that amendment 2a was a technical amendment to increase the "other funds" line for federal funds to allow the University of Alaska Anchorage Aviation Technology Center to receive federal matching funds. The new number is $10,590,000 and the increase is $6,885,000. In answer to Senator Kerttula, BRIAN ROGERS, Vice President for Finance, University of Alaska, stated that those federal funds were not available for any other purpose. Senator Rieger MOVED for ADOPTION of amendment 2a. No objections having been raised, amendment 2a was ADOPTED. Co-chair Pearce explained that amendment 2b would add a new section for the University of Alaska Southeast, Sitka campus, classroom/ program planning/lab expansion. Senator Kelly asked if profit from the Indian River project would be used for some of the facility maintenance that has been allowed to lapse. Mr. Rogers said that since the funds would accrue from the community campus, the University felt those funds should be used at the Sitka campus. Senator Rieger MOVED for ADOPTION of amendment 2b. In answer to Senator Kelly's objection, Mr. Rogers said that it would provide sufficient funding to complete the classrooms in the hanger that is now being used. In answer to Senator Kelly, Mr. Rogers said the expected revenue would be somewhere between $700.0 and $1,000.0. No further objections having been raised, amendment 2b was ADOPTED. Co-chair Pearce said that amendment 3 was a correction of $50,000 from the Copper Valley Economic Development Council for the Nitty Gritty Dirt Bank Tourism Production to Small Business Assistance & Regional Marketing. SENATOR BERT SHARP MOVED for ADOPTION of amendment 3. No objections having been raised, amendment 3 was ADOPTED. Senator Kelly said that amendment 4 would move $270.0 from the Department of Community & Regional Affairs to the Department of Administration. Senator Kelly MOVED for ADOPTION of amendment 4. No objections having been raised, amendment 4 was ADOPTED. Senator Kelly said that amendment 4b would combine lines 29 and 32 on page 48, saving 15 percent in costs. Senator Kelly MOVED for ADOPTION of amendment 4b. No objections having been raised, amendment 4b was ADOPTED. Co-chair Pearce announced that amendment 5 was proposed by Senator Randy Phillips and moved $55.0 general funds from the municipality of Anchorage to Anchorage Neighborhood Housing. Senator Kelly MOVED for ADOPTION of amendment 5. No objections having been raised, amendment 5 was ADOPTED. Co-chair Pearce said that amendment 6 was proposed by Senator Johnny Ellis and was a technical amendment to include both of his election districts in the description of the bill. Senator Rieger pointed out that page 77 should read page 73. Senator Kelly MOVED for ADOPTION of amendment 6 amended to read "page 73." No objections having been raised, amendment 6 was ADOPTED. Co-chair Pearce said that amendment 7 also proposed by Senator Johnny Ellis were discretionary projects and a net zero. Senator Kelly MOVED for ADOPTION of amendment 7. No objections having been raised, amendment 6 was ADOPTED. Co-chair Pearce announced that amendment 8 was a project description change proposed by Senator Suzanne Little. SENATOR JAY KERTTULA MOVED for ADOPTION of amendment 8. No objections having been raised, amendment 8 was ADOPTED. Co-chair Pearce explained that some allocations under Alaska Mental Health Board designated projects were incorrectly listed and amendment 9 corrected those appropriations. Senator Rieger MOVED for ADOPTION of amendment 9. No objections having been raised, amendment 9 was ADOPTED. Co-chair Pearce said that amendment 10 by Senator Mike Miller replaced the North Pole Water system construction with the Kodiak water system improvements. Co-chair Pearce said she understood that the Kodiak project is a pilot project for the state that will be test a new filtering system. If it works, other systems can take advantage of the new technology. She also pointed out that this request made by Senator Miller was in frustration with non-action taken by DOT/PF regarding the North Pole water system construction. For the past several years, this project has been replaced with other projects. Senator Kerttula MOVED for ADOPTION of amendment 10. No objections having been raised, amendment 10 was ADOPTED. Co-chair Pearce said that amendment 11 by Co-chair Frank, and Senators Miller and Sharp provided rewording and is a net zero effect. Senator Sharp MOVED for ADOPTION of amendment 11. Senator Rieger MOVED that the amendment be changed to read, $53,200 instead of 53.2, and $22,800 instead of 22.8. No further objections having been raised, amendment 10 as amended was ADOPTED. Co-chair Pearce asked if Senator Kerttula would offer amendment 12. Senator Kerttula explained that this allocation for DEC was in the Governor's original budget and asked that $1,350.0 be added to the Kenai-Thompson Park water and sewer. Senator Kerttula MOVED for ADOPTION of amendment 12. Senator Kelly OBJECTED. Co-chair Pearce called for a show of hands and the motion FAILED on a vote of 4-1. (Senator Kerttula was in support. Co-chairs Pearce and Frank, Senators Kelly and Sharp were opposed. Senators Jacko and Rieger did not vote.) Senator Rieger MOVED for ADOPTION of amendment 13. He said that amendment 13 added intent language, made corrections to wording, and changed appropriations for a net zero result. No objections having been raised, amendment 13 as amended was ADOPTED. Recess 7:15pm Reconvene 7:25pm Amendment 14 was held and later included in amendment 19. (See amendment 19 for detail.) Co-chair Pearce announced that amendment 15 would add intent language regarding $15,000.0 for the University of Alaska - deferred maintenance. Senator Kerttula MOVED amendment 15. No objections being heard, amendment 15 was ADOPTED. Amendment 16 was not offered. Amendment 17 was held until later in the meeting. SENATOR GEORGE JACKO MOVED amendment 18 moving funds between projects at a zero net, and two projects from Department of Environmental Conservation to the Department of Education. Senator Kerttula OBJECTED and advised the committee that the Goodnews Bay project would probably not begin and would, over time, cost the state approximately $5M if it was allowed to continue. Senator Kerttula withdrew his objection. Recess 7:30pm Reconvene 7:35pm After some discussion, about amendment 18, Senator Rieger OBJECTED. Co-chair Pearce called for a show of hands and amendment 18 was ADOPTED on a vote of 4-2. (Senators Kerttula and Rieger were opposed. Co-chairs Pearce and Frank, Senators Jacko and Sharp were in support. Senator Kelly did not vote.) Senator Rieger explained that amendment 14 would include amendment 19 "revised." He said that this amendment would add $450.0 of general fund money to the budget. Senator Rieger MOVED amendment 14 including 19 "revised." Senator Jacko OBJECTED. Co-chair Pearce called for a show of hands and the motion FAILED on a vote of 4-2. (Senators Kerttula and Rieger were in support. Senators Pearce, Kelly, Jacko, and Sharp were opposed. Co-chair Frank was absent from the meeting at the time the vote was taken.) Recess 7:40pm Reconvene 7:42pm Co-chair Pearce MOVED amendment 17 which increased federal authorization of $5,000,000 for the multi-purpose replacement vessel. Discussion was had by Co-chair Pearce, Senators Kelly, and Sharp regarding federal funding for the state, discretionary funding, and the total cost of the new replacement vessel. Co-chair Pearce invited Karen Rehfeld, Fiscal Analysts, Legislative Finance Division, to join the committee at the table and explain the replacement vessel funding. Co-chair Pearce called for a show of hands and the motion FAILED on a vote of 4-3. (Senators Kerttula, Rieger and Jacko were in support. Co-chairs Pearce and Frank, Senators Sharp and Kelly were opposed.) (Note: Action taken on Amendment 17 was rescinded later in the meeting and amendment 17 was ADOPTED.) End SFC-93 #70, Side 2 Begin SFC-93 #72, Side 1 Senator Rieger MOVED amendment 20 which is a change of language for the Port of Anchorage. In answer to Senator Kerttula, Co-chair Pearce said the projects had nothing to do with the Ship Creek area. Senator Jacko OBJECTED. Co- chair Pearce called for a show of hands and amendment 20 was ADOPTED on a vote of 5-1. (Co-chair Pearce and Senators Kelly, Kerttula, Sharp and Rieger were in support. Senator Jacko was opposed. Co-chair Frank was absent from the meeting at the time the vote was taken.) Amendment 21 was not offered by Senator Kerttula. Amendment 22 was not offered by Senator Robin Taylor. Senator Kerttula MOVED amendment 23 changing the election district reference. No objections being heard, amendment 23 was ADOPTED. Senator Kerttula MOVED amendment 24 moving $60,000 from the Seward SeaLife project to the Frontier Training Center Rehabilitation Construction project. Discussion . was had by Senators Kelly, Kerttula and Co-chair Pearce in an effort to identify the Seward project. It was determined to be discretionary money and a net zero. No objections being heard, amendment 24 was ADOPTED. Senator Kerttula MOVED amendment 25 changing discretionary money. Senator Kelly OBJECTED. It was determined that this amendment was discretionary money and a net zero. Senator Kelly withdrew his objection. No further objections being heard, amendment 25 was ADOPTED. Recess 8:02pm Reconvene 9:00pm Senator Kerttula MOVED to RESCIND prior committee action failing to adopt amendment 17. Senator Kelly voiced his concern again over the projected $85M cost of the new vessel. No objections being heard, prior action was RESCINDED. Senator Kerttula MOVED to adopt amendment 17. No objections being heard, amendment 17 was ADOPTED. Co-chair Pearce invited Shelby Stastny, Director, Office of Management & Budget, Office of the Governor, and Cheryl Frasca, Division Director, Division of Budget Review, Office of Management & Budget, Office of the Governor, to join the committee at the table and explain the following amendments by OMB. SHELBY STASTNY said that in most cases the figure that appeared in the amendment column was the figure found in the House budget. CO-CHAIR STEVE FRANK MOVED amendment 26 for the Department of Administration. Intent language and the Mount Roberts Marina were not moved. No objections being heard, amendment 26 was ADOPTED. Co-chair Frank MOVED amendment 27 for the Department of Commerce & Economic Development. The Alaska Energy Authority, adding Electrical Services Extension Grant Program, was not moved. No objections being heard, amendment 27 was ADOPTED. Co-chair Frank MOVED amendment 28 for the Department of Community & Regional Affairs adding only the data processing equipment. No objections being heard, amendment 28 was ADOPTED. Co-chair Frank MOVED amendment 29 for the Department of Education adding only State Library materials and equipment, statewide data management system and AVTEC equipment purchases, and deleting department micro image optical system. No objections being heard, amendment 29 was ADOPTED. Co-chair Frank MOVED amendment 30 which moved the Governor's cutoff line up to but including Togiak on page 3 of the amendment. On page 1, Kodiak water system construction (included and already moved in amendment 10), Holy Cross sanitation and lagoon, and Huslia water and sewer design, was excluded. Senator Kerttula OBJECTED and asked if the projects excluded below Togiak were less important. Co- chair Frank said instead of choosing certain projects, the line was used for the purpose of changing the funding figure. Discussion was had by Co-chair Frank and Senator Kelly for clarification of projects. Co-chair Pearce called for a show of hands and amendment 30 was ADOPTED on a vote of 6-1. (Co-chairs Pearce and Frank, Senators Kelly, Jacko, Sharp and Rieger were in support. Senator Kerttula was opposed.) Co-chair Frank MOVED amendment 31 adding funding for Toklat Chum Salmon restoration, and funding to vessels major maintenance, assert and protect the state's right to manage Alaska's resources, and major equipment replacement. No objections being heard, amendment 31 was ADOPTED. Co-chair Frank MOVED amendment 32 adding funding for the Department of Labor for workers' compensation records and claims handling/imaging system. Senator Kelly OBJECTED. Amendment 32 was held until later in the meeting. Co-chair Frank MOVED amendment 32 amending the funding to $200.0. No objections being heard, amendment 32 as amended was ADOPTED. Co-chair Frank MOVED amendment 33 adding funding for the Department of Natural Resources. Senator Kelly OBJECTED. Amendment 33 was held until later in the meeting. Co-chair Frank asked Mr. Stastny to speak to the final land selections by the Department of Natural Resources. Senator Kelly voiced his concern over the increase in funding for the land selections. Mr. Frasca spoke to a definition of owner state assertions/land selections. Co-chair Frank MOVED to amend the number to $1,000.0 for land selections. Senator Kelly MOVED to amend that figure to $750.0. Co- chair Frank MOVED amendment 33 adding funding for the recorder's office-records preservation, forest inventory, hydrological network evaluation and owner state assertions/land selections amended to $750.0. No objections being raised, amendment 33 as amended was ADOPTED. Co-chair Frank MOVED amendment 34 adding funding for the Department of Safety to facilities renewal & replacement/deferred maintenance, and Training Academy equipment. No objections being raised, amendment 34 was ADOPTED. Recess 9:20pm Reconvene 9:22pm Co-chair Frank MOVED amendment 35 adding funds to the Department of Transportation & Public Facilities. Amendment 35 was held until later in the meeting. Amendment 35 was then withdrawn but Senator Kerttula moved related amendment 36. Senator Kerttula MOVED amendment 36 to add Juneau access route PE funding for $1,800.0. Senator Kelly OBJECTED because of the funding already designated for the new vessel. Co-chair Pearce called for a show of hands and the motion FAILED on a vote of 6-1. (Senator Kerttula was in support. Co-chairs Pearce and Frank, Senators Sharp, Jacko, Rieger, and Kelly were opposed.) Senator Kerttula MOVED amendment 37 by Senator Lincoln reallocating discretionary funds. No objections being raised, amendment 37 was ADOPTED. Senator Kerttula MOVED amendment 38 for the Mat-Su Borough "Chickaloon Trail" road upgrade. Senator Sharp OBJECTED. Co-chair Pearce called for a show of hands and the motion FAILED on a vote of 6-1. (Senator Kerttula was in support. Co-chairs Pearce and Frank, Senators Sharp, Jacko, Rieger, and Kelly were opposed.) Recess 9:40pm Reconvene 9:45pm End SFC-93 #72, Side 1 Begin SFC-93 #72, Side 2 Senator Kerttula MOVED amendment 39 by Senator Lincoln reallocating discretionary funds. Senator Kelly OBJECTED. Discussion followed, and Senator Kelly withdrew his objection. No further objections being raised, amendment 39 was ADOPTED. In answer to Senator Kelly, Co-chair Frank said the increase at the request of the Governor and by these amendments amounted to $4.6M. Senator Kelly MOVED for adoption of CSSB 50(FIN) as amended. No objections being heard, it was ADOPTED. Co-chair Pearce informed the committee that CSSB 50(FIN) would be used as an amendment to another appropriations bill. She suggested if there were any more amendments to be made, that they be brought to the Senate floor. Co-chair Frank MOVED for passage of CSSB 50(FIN) as amended from committee with individual recommendations. No objections being heard, CSSB 50(FIN) was REPORTED OUT of committee. (Co-chairs Frank and Pearce, Senators Kelly, Rieger, Sharp and Jacko signed "do pass." Senator Kerttula signed "no recommendation.") ADJOURNMENT The meeting was adjourned at approximately 10:15 p.m.