SENATE TRANSPORTATION COMMITTEE April 8, 1999 1:40 p.m. MEMBERS PRESENT Senator Jerry Ward, Chairman Senator Mike Miller Senator Georgianna Lincoln MEMBERS ABSENT Senator Drue Pearce, Vice Chair Senator Rick Halford COMMITTEE CALENDAR SENATE BILL NO. 129 "An Act relating to the Alaska marine highway system vessel, M/V Malaspina; and providing for an effective date." -MOVED SB 129 OUT OF COMMITTEE PREVIOUS SENATE ACTION SB 129 - No former action to report WITNESS REGISTER Ms. Llewellyn Lutchansky, Staff Aide Senator John Torgerson Alaska State Capitol Juneau, AK 99811-1182 POSITION STATEMENT: Presented SB 129 Mr. Bob Doll, General Manager Ferry Operations Department of Transportation & Public Facilities 3132 Channel Drive Juneau, AK 99801-7898 ACTION NARRATIVE TAPE 99-08, SIDE A Number 001 SB 129-M/V MALASPINA ACCOUNT CHAIRMAN WARD called the Senate Transportation Committee meeting to order at 1:40 p.m. and brought up SB 129. Number 013 MS. LLEWELLYN LUTCHANSKY, Staff to Senator Torgerson, presented the sponsor statement for SB 129. Sponsored by the Senate Finance Committee, SB 129 would create a sub-account in the Alaska marine highway system to separately track revenues and expenditures related to the day boat operation of the M/V Malaspina. Expenditures for its operation, maintenance and capital improvements would be limited to the gross revenues generated by the vessel, and to any other funds the Legislature may appropriate to the account. This will be its second year of operation as a day boat in the Northern Lynn Canal during the summer months. Last session the Legislature allowed the department an initial subsidy and directed DOTPF to limit operation costs to the program receipts the Malaspina generates by seeking union concessions and targeting high volume seasonal runs. The Southeast Alaska Transportation Plan is premised on the development of sub-area or regional transportation services and facilities. As more high-speed "day boats" are put into operation in the region's four zones over the next five years, substantial savings are expected to be realized in operations and maintenance costs. SENATOR LINCOLN asked if the department would comment on the bill. Number 071 MR. BOB DOLL, General Manager of Alaska Marine Highway System, stated the department has worked with Senator Torgerson's office to determine the effect of the bill, and he doesn't foresee any significant difficulties ahead. The Malaspina has been more closely observed than any other ship, and it operates in one of the high revenue links. There are two or three links in the system offering comparable revenues: Bellingham - Ketchikan and Prince Rupert - Ketchikan. The Malaspina is not a typical operation and he admitted apprehensiion about lessons being drawn from it, but as far as the bill is concerned, he was sure it can be worked out. SENATOR LINCOLN mentioned the zero fiscal note. She quoted in the last paragraph in the sponsor statement, "...the Legislature does not intend to subsidize the operation of day boats," and asked Mr. Doll for his reaction to that statement. MR. DOLL replied the Southeast Alaska Transportation Plan addresses two kinds of operation. One operation involves the construction of new high-speed ships that would provide "shuttle service." The other operation involves conversion of existing vessels that would be called "day boats." A new "shuttle" ship would have a much smaller crew and much smaller operating cost. The question of tariffs for that operation has not been approached. Regarding the zero fiscal note, tracking the cost of operation and revenue of a ship on a weekly basis is an intensive process that will require some additional labor, but nothing the department can put a cost to. He concluded they will need to establish the cost of operating the shuttle ships and an initial estimate of tariffs, and adjust the two after a couple of seasons of operation. Number 149 CHAIRMAN WARD asked the wish of the committee. SENATOR MILLER moved SB 129 out of committee with individual recommendations and attached zero fiscal note. Without objection, it was so ordered. The committee adjourned at 1:48 p.m.