SENATE TRANSPORTATION February 14, 1995 1:30 p.m. MEMBERS PRESENT Senator Steve Rieger, Chair Senator Lyda Green Senator Al Adams Senator Georgianna Lincoln MEMBERS ABSENT Senator Robin Taylor, Vice Chair COMMITTEE CALENDAR Confirmation Hearing: Department of Transportation and Public Facilities Designee: Joseph Perkins, Commissioner Designee P.O. Box 20129 Juneau, Alaska 99801 ACTION NARRATIVE TAPE 95-3, SIDE A CHAIRMAN RIEGER called the Senate Transportation meeting to order at 1:35 p.m. Senator Hoffman joined committee members at the table. The only item on the agenda was the confirmation of Joseph Perkins, as the Commissioner of the Department of Transportation and Public Facilities (DOTPF). MR. PERKINS informed committee members he did not have a prepared statement but was available to answer questions. SENATOR ADAMS asked how Mr. Perkins will handle ISTEA funding. MR. PERKINS replied the ISTEA funding as it now stands is broken into several categories: the national highway system; and others. ISTEA funds have been handled in the past through the state but there is a provision within ISTEA to share this money with the communities. Apparently this plan was developed two years ago and then was stopped. He has created a committee to review that plan to see what it does and to see if there is the potential to distribute funds to the communities. ISTEA funds will only exist for two more years, when the bill will be reauthorized in Congress. He did not know how the bill will be changed in light of the reorganization of the federal Department of Transportation, which is currently in the hands of Congress. SENATOR HOFFMAN noted the Department submitted its six year plan, prior to this Administration, which contained phased projected appropriations. Those have been changed and are now listed as priorities, and the plan no longer seems to encompass a longer time period than one year. He asked Mr. Perkins if he intends to keep the present system, or to reinstate a six year plan. MR. PERKINS replied DOTPF is going to redo its planning in that a six year plan will be devised so that projects can be tracked more closely. The six year plan will identify projects that fulfill the needs of the national highway system program and hopefully defend our share of the funds. All interstate roads in the "lower 48" have been finished, and are now in a reconstruction/maintenance phase. Alaska is probably the only state that has not finished its roads in that system. Number 090 SENATOR HOFFMAN asked how communities provide input into the process. He added that DOTPF holds hearings in many of the larger communities, such as Dillingham, Bethel, Kotzebue, Barrow and Nome, but the smaller communities do not have the opportunity to participate in the planning process. MR. PERKINS stated he believed in having as much public participation as possible in these programs. In Alaska, it is sometimes difficult to reach the smaller communities, but he pledged to try to ensure DOTPF planning teams get to as many places as possible to give briefings and presentations. In places that planning teams do not get to, the public needs to be notified so that it can respond. Number 121 SENATOR GREEN discussed a situation in the Mat-Su Borough in which Mr. Perkins and his staff were quick to ask for community input and the problems were resolved amicably. She also noted the public perception of the DOTPF is that it is large and unwieldy with too much power. It has been argued that it could be reduced, privatized, or made more efficient. She asked for Mr. Perkins' view of those perceptions. Number 135 MR. PERKINS responded that DOTPF is a large organization with approximately 3,000 employees, with representatives in almost every part of the State of Alaska. He plans to promote efficiency by eliminating duplicate functions. Presently he has the three regional directors reorganizing the regional offices so that each regional office functions in the same manner. He also plans to look at whether there are special areas of expertise within each regional office that could be used by other regions. He felt the question of privatization is difficult. There are things in DOTPF that can be privatized, but there are basic services that cannot. Some of the highway and winter maintenance services in outlying areas could be privatized. He did not believe snow removal and maintenance of the Parks Highway could be privatized because no contractor in the state owns the necessary equipment. Some services have been privatized, such as air field clearing, and roads outside of maintenance areas. He was unsure how much more could be privatized. In the area of construction, DOTPF is awarding design contracts to private firms, and he felt it is essential that two capabilities be maintained: a state-owned capability mandated by the federal government in the highway program; and a civilian engineering firm capability. A balance needs to be determined in DOTPF's engineering and design program to establish what work will be contracted out. DOTPF employees need to know they are working in a stable work environment to improve morale. A majority of the physical construction work is contracted out, but many of the projects are managed within DOTPF. He plans to do a pilot project in which the project management work would be contracted out to civilian engineers and project managers because he felt that capability needs to be preserved in the State. Number 313 SENATOR LINCOLN noted Mr. Perkins' construction experience on waste heat facilities throughout rural Alaska. She expressed concern that inadequate input from communities regarding planning, feasibility, design, and construction, resulted in wasted funds and manpower. She asked what Mr. Perkins plans to do to remedy the lack of community input, and to increase local hire. He restated his support of local input. He discussed his involvement in public hearings throughout the State with the Army Corps of Engineers, and he found the toughest situations to occur when the communities were split 50/50. He plans to reappraise the entire Copper River Highway and find out what people think. He promised there will be plenty of public involvement, but he cannot promise that everybody will be happy. He thought the DOTPF has done a good job of obtaining public input in federal aid projects because it is required. There is a fairly extensive record of those public hearings. He conducted public hearings throughout the State of Alaska on the Wetlands Program in 1977 and two people showed up in Ketchikan, and six showed up in Juneau, yet the law that went into effect became the monster we are dealing with now. He felt it is critical to get people to these meetings. SENATOR LINCOLN asked how Mr. Perkins intends to lower the costs of transportation. MR. PERKINS replied that will be a very difficult problem and he is unsure what he can promise. DOTPF will continue to improve airports and the necessary safety criteria upgrades will be emphasized. He does not have much of an impact on what carriers charge. All he can do is provide good facilities which will result in more efficient and cost effective transportation. He felt confident he could influence the costs of building and maintaining the overall transportation system. SENATOR LINCOLN clarified that she is referring to the whole system including the ferry system, the railroad, the roads, and the airplanes. She felt many commissioners have failed to recognize that, contrary to the belief that Alaska has a family of one, Alaska has a family of three: the urban family; the rural family; and the bush family, and their lifestyles are very different. Those differences need to be recognized, and not molded together. Regarding the ferry system, she asked whether MR. PERKINS planned to connect the Southeast ferry to the Southcentral ferry, and to connect Valdez, Whittier, and Cordova. Prince William Sound residents are concerned that the ferry system is inadequate, and that a road will not go in. MR. PERKINS has not had time to dig deeply into the problems of the ferry system, therefore he was unprepared to answer at this time. He will look at the problem and provide information at a later date. SENATOR LINCOLN asked Mr. Perkins to provide the committee with the information. He agreed. SENATOR RIEGER remarked the committee will also be taking up the Task Force recommendations that were forwarded last October. Number 347 SENATOR LINCOLN questioned whether Mr. Perkins has thought about eliminating certain top level management positions due to duplication of efforts. She also questioned what other technologies are available to resolve the dust control problems at rural airports. MR. PERKINS stated technology has not provided a magic substance to control dust. He promised to look into the recent advances in this area. Regarding the mid- to upper-level management positions within DOTPF, he is looking into restructuring DOTPF to increase efficiency. There will be one or two exempt positions that will not be filled. He is looking at other positions individually to decide whether or not they are required. So far, he has reviewed the regional positions. There are three top level positions in each of the three regions that are basically duplicate positions. One of the positions is not filled in Southeast. He plans to reduce the number of these positions. He added a very large percentage of the Department's budget is funded with federal dollars, therefore if there is a cut in federal funding, the Department size will decrease substantially. The only thing funded by the General Fund in an operational mode, is maintenance and operations. Those budgets have been cut as much as possible without decreasing service and equipment. If there is a decline in funding, there will be a decline in services provided. He cannot use the designer or construction worker funded by the federal CIP funds to do state maintenance work. The majority of the planning effort done in the Department, that is federally funded, includes almost all of the design and construction workers. Over the last ten years, the budget has remained constant, but the workload has increased. This has lead to deferred maintenance because there are no people to do that work. The fact that so many of the DOTPF employees are federally funded may give the public a false impression of the State's costs. Number 418 SENATOR ADAMS asked what alternative plans, such as a fuel tax, might be submitted by Mr. Perkins, in the form of legislation. MR. PERKINS replied he is currently examining several things and developing a plan. He is reviewing the possibility of instituting a fuel tax and a dedicated fund for maintenance purposes, but he is not prepared to present that at this time. By next year DOTPF will have a package put together that addresses maintenance. Whether a tax is included in that package has not been decided. There have been recommendations from the Transition Team and various others that considered a fuel tax and dedicated fund for maintenance of State facilities. SENATOR ADAMS asked if Mr. Perkins would be willing to transfer some of the excess funds generated by the Anchorage airport to other areas of the State for airport maintenance. MR. PERKINS replied DOTPF already transfers funds from Anchorage to Fairbanks. SENATOR ADAMS asked who the three division directors are. MR. PERKINS answered the Central Region Director is John Horn, the Southeast Director is Jon Scribner, and the Northern Region Director is Stephen Sisk. SENATOR HOFFMAN remarked that the mayor of Anchorage is looking at the possibility of proposing to take over the operations of the International Airport, with the primary goal of preventing the state from losing money. MR. PERKINS stated DOTPF does not have a position on the airport authority proposed by the mayor of Anchorage. Beginning next week, he will be visiting the airports. SENATOR HOFFMAN felt the possibility of creating a transportation authority should be examined, to prevent splintering of the transportation system, and to benefit all citizens. He asked Mr. Perkins' opinion on the sale of the Alaska Railroad. MR. PERKINS felt he does not have the knowledge to comment on that question. SENATOR LINCOLN asked Mr. Perkins' position on studded tires. MR. PERKINS replied the issue of whether the studded tires are damaging the road is clear, but that damage needs to be weighed against the safety factor. He stated if lives are being saved by the use of studded tires, they need to be used. Maybe some method of returning money from the purchase of them, or a tax, to help repair some of the damage, is feasible. SENATOR LINCOLN remarked that someone within DOTPF stated the problem with the road in Juneau was not caused by studded tires, it was caused by inadequate paving material that was used. MR. PERKINS was unsure, but had assumed the cause was studded tires. SENATOR GREEN moved that the committee forward Mr. Perkins name on to the Legislature. SENATOR RIEGER clarified there is a standard form used which says there is no stated objection; it is not an indication of support or opposition. There being no objection, the motion passed. SENATOR REIGER adjourned the meeting at 2:13 p.m.