Legislature(2015 - 2016)HOUSE FINANCE 519

04/07/2016 08:30 AM House FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Delayed to 8:45 a.m. Today --
Moved HB 259 Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved CSHB 188(FIN) Out of Committee
HOUSE BILL NO. 259                                                                                                            
     "An Act relating to relocation assistance for                                                                              
     federally   assisted   projects   and   programs;   and                                                                    
     providing for an effective date."                                                                                          
8:50:17 AM                                                                                                                    
MARK LUIKEN, COMMISSIONER,  DEPARTMENT OF TRANSPORTATION AND                                                                    
PUBLIC FACILITIES,  explained that  the purpose of  the bill                                                                    
was to  bring Alaska  statutes into compliance  with federal                                                                    
law. He continued that when  right-of-ways were acquired for                                                                    
public  transportation  purposes  federal law  required  the                                                                    
department to  compensate property  owners for the  value of                                                                    
the  property   and  to   provide  relocation   benefits  to                                                                    
displaced  families,   businesses,  and  farms.   Under  the                                                                    
federal  initiative  known  as  MAP  21  [Moving  Ahead  for                                                                    
Progress], the  previous federal transportation  bill passed                                                                    
in 2012, the state's funding  partners had made it easier to                                                                    
qualify  and  increase  the  maximum  relocation  assistance                                                                    
available to  the affected parties. Benefits  paid to Alaska                                                                    
families  and   businesses  related  to  the   program  were                                                                    
eligible   for  federal   reimbursement.   He  thanked   the                                                                    
committee for hearing the bill  and considering its passage.                                                                    
He was happy to respond to any questions.                                                                                       
Co-Chair Neuman  asked why the  state needed the  bill since                                                                    
the  state  could  already   accept  federal  funds  without                                                                    
legislative approval.                                                                                                           
8:51:53 AM                                                                                                                    
HEATHER    FAIR,   RIGHT-OF-WAY    CHIEF,   DEPARTMENT    OF                                                                    
TRANSPORTATION AND PUBLIC  FACILITIES, asked Co-Chair Neuman                                                                    
to elaborate on his question.                                                                                                   
Co-Chair Neuman  restated his  question. Ms.  Fair confirmed                                                                    
that the  state already had authorization  to accept federal                                                                    
funding.   However,  the   current  statutes   limited-  the                                                                    
department's ability to pay  the funding to families, farms,                                                                    
and businesses.  There was  a statutory  limit that  did not                                                                    
currently  comply with  the new  federal maximums.  The bill                                                                    
would bring the  state into compliance with  the new federal                                                                    
8:52:56 AM                                                                                                                    
Co-Chair Neuman  asked Ms. Fair  to explain further.  He had                                                                    
worked  with  the  commissioner  on  expansions  within  the                                                                    
state.  He asked  her to  provide  sideboards including  the                                                                    
previous  limit and  the current  limit. Ms.  Fair explained                                                                    
that the  limits had been raised  under the MAP 21  bill for                                                                    
federal  highways. Under  previous legislation  by congress,                                                                    
business  reestablishment  payments  were  only  limited  to                                                                    
$10,000. They  were now $20,000 under  federal limits. Fixed                                                                    
payments  in lieu  of  actually  moving and  reestablishment                                                                    
used to be only $20,000  and was now $40,000. The perimeters                                                                    
around replacement  housing for home owners  used to include                                                                    
having to  live in your  home 180 days  and now was  only 90                                                                    
days. The limit  used to be $22,500 and now  it was $31,000.                                                                    
The final increase was replacement  housing for tenants that                                                                    
were not  owners. She explained  that being a 90  day tenant                                                                    
used to be $5250 and was now $7200.                                                                                             
8:54:18 AM                                                                                                                    
Co-Chair  Neuman clarified  that the  state was  required to                                                                    
assist  people that  had been  displaced because  of eminent                                                                    
domain.  Commissioner Luiken  responded in  the affirmative.                                                                    
He emphasized  that it was purely  the relocation assistance                                                                    
piece  of  the process  -  to  help  people when  they  were                                                                    
8:54:53 AM                                                                                                                    
Representative Wilson  asked if  it was all  federal funding                                                                    
or if  there was state  funding as well. Ms.  Fair responded                                                                    
that  there was  a portion  of state  funding that  could be                                                                    
applicable. The state's share was  roughly 9 percent. It was                                                                    
a small  amount relative  to the  total cost  of relocation.                                                                    
The federal government's share was about 91 percent.                                                                            
8:55:34 AM                                                                                                                    
Representative  Wilson  asked  her  for  the  definition  of                                                                    
"reasonable" noted  in the  language of  the bill.  Ms. Fair                                                                    
replied  that   there  were   definitions  in   the  federal                                                                    
regulations  to which  they were  being referred  to in  the                                                                    
bill under Section 1.                                                                                                           
8:55:59 AM                                                                                                                    
Representative  Munoz asked  how the  department dealt  with                                                                    
businesses  that   had  a   loss  of   business  due   to  a                                                                    
transportation  project.   She  wondered  if  there   was  a                                                                    
reimbursement  policy  to  deal  with the  issue.  Ms.  Fair                                                                    
reported  that the  state did  not  compensate for  business                                                                    
losses,  but  it  did  compensate  for  relocation  and  for                                                                    
reestablishment of a business under federal law.                                                                                
Representative  Kawasaki  asked  if similar  legislation  in                                                                    
other states had  eased eminent domain takings.  He asked if                                                                    
that was the purpose of the legislation.                                                                                        
Ms. Fair  stated that it  was specific to  relocations apart                                                                    
from the acquisitions. In general,  congress' purpose was to                                                                    
help  assist  families  for relocation  and  businesses  for                                                                    
reestablishment. Any type of  relocation could be disruptive                                                                    
and congress  recognized that prices  had gone up,  costs to                                                                    
relocate  had  increased, and  it  was  time to  adjust  the                                                                    
amounts available to eligible parties.                                                                                          
Representative Kawasaki suggested that  it was a substantive                                                                    
policy call when discussing eminent  domain and federal road                                                                    
projects which he wanted the committee to be aware of.                                                                          
8:57:56 AM                                                                                                                    
Representative  Guttenberg  relayed  being involved  with  a                                                                    
project  in  his  district. The  right-of-way  had  been  on                                                                    
private property. The department had  been willing to move a                                                                    
building  or a  septic  system.  He asked  if  there was  an                                                                    
example  of a  building needing  to  be moved  or a  similar                                                                    
situation. He  wondered about  the qualifications.  Ms. Fair                                                                    
replied  that the  bill  assisted  with some  qualifications                                                                    
which allowed  an easier pathway  by reducing the  number of                                                                    
days that a person had to  be a homeowner or tenant from 180                                                                    
to 90  days. As  far as  relocating a  building or  a septic                                                                    
system, that  fell under the  category of  acquisition which                                                                    
the  bill  did  not  address.  Relocation  meant  moving  to                                                                    
another site.                                                                                                                   
8:59:52 AM                                                                                                                    
Representative Gattis  asked about  farms. She  wondered why                                                                    
farms were  mentioned independent  of businesses.  She asked                                                                    
about the distinction for farming.                                                                                              
Ms.  Fair  suggested  that  in   federal  law  there  was  a                                                                    
distinction for farming. The law  was referred to in the new                                                                    
legislation.  She  admitted  that  she  was  also  a  fellow                                                                    
Representative Gattis thought it  was important to recognize                                                                    
issues that  accompanied a  right-of-way on  a farm.  It was                                                                    
possible that with a  right-of-way farming could potentially                                                                    
not  be  possible  on  either  side  or  crossing  could  be                                                                    
impeded.  There had  been certain  situations  that came  up                                                                    
around these  issues. She wondered  if such issues  were the                                                                    
reason  for   farming  having   a  distinction   over  other                                                                    
Ms.  Fair  stated  that  the  federal  government  made  the                                                                    
distinction  because of  the  reasons Representative  Gattis                                                                    
had  brought  up. The  bill  did  not address  the  specific                                                                    
issues  mentioned,  only  the  relocation  of  a  farm,  for                                                                    
9:01:35 AM                                                                                                                    
Representative   Gattis   thought   it   was   a   lengthier                                                                    
conversation.  She suggested  that some  of the  same issues                                                                    
could apply to any business.                                                                                                    
9:02:05 AM                                                                                                                    
Vice-Chair  Saddler  wanted  to  know  historic  numbers  of                                                                    
people  that  had  been   displaced  by  federally  assisted                                                                    
programs and the associated costs.                                                                                              
Ms.  Fair stated  that  the effective  date  was in  October                                                                    
2014. There  was just a  hand full of people  and businesses                                                                    
that  had increased  eligibility. The  state's share  of the                                                                    
costs were estimated to be  $12,000 in retroactive payments.                                                                    
Through  a  design  process  the  state  tried  to  minimize                                                                    
relocations   as   best   as  possible   understanding   how                                                                    
disruptive they could be.                                                                                                       
9:03:04 AM                                                                                                                    
Vice-Chair Saddler wanted a firm number.                                                                                        
Ms. Fair  stated that there  were about a dozen  people that                                                                    
qualified for  additional money under the  statute since the                                                                    
effective date.                                                                                                                 
9:03:35 AM                                                                                                                    
Representative  Kawasaki  referenced   Section  3  regarding                                                                    
business  and  moving  expenses  but  not  acquisitions,  he                                                                    
wondered if  there had been  any relocations  resulting from                                                                    
various right-of-way acquisitions in  the Fairbanks area. He                                                                    
asked if there  were examples of a business  having to move.                                                                    
He provided an example of  a veterinary clinic on the corner                                                                    
of  a  Fairbanks  intersection  that had  to  be  moved.  He                                                                    
wondered if his  example was one where  moving expenses were                                                                    
compensated above the $10,000 cap.                                                                                              
Ms.  Fair  responded that  the  veterinarian  clinic was  an                                                                    
example  where  the state  assisted  in  relocation. It  was                                                                    
prior  to October  2014.  However, it  would  be an  example                                                                    
where they would be eligible  for more in relocation but not                                                                    
acquisition.   Acquisition  was   always  market   value  or                                                                    
9:04:51 AM                                                                                                                    
Co-Chair Thompson OPENED public testimony.                                                                                      
9:05:06 AM                                                                                                                    
Co-Chair Thompson CLOSED public testimony.                                                                                      
9:05:11 AM                                                                                                                    
AT EASE                                                                                                                         
9:06:46 AM                                                                                                                    
Commissioner  Luiken reemphasized  that the  purpose of  the                                                                    
bill was  to bring  the state  into compliance  with federal                                                                    
law so that the state was  able to pay Alaska residents what                                                                    
they would be due in additional relocation benefits.                                                                            
Co-Chair  Neuman MOVED  to REPORT  HB 259  out of  committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
note(s). There being NO OBJECTION, it was so ordered.                                                                           
HB  259 was  REPORTED  out  of committee  with  a "do  pass"                                                                    
recommendation and  with a previously published  zero fiscal                                                                    
note: FN1 (DOT).                                                                                                                
9:07:49 AM                                                                                                                    
AT EASE                                                                                                                         
9:10:22 AM                                                                                                                    

Document Name Date/Time Subjects
HB 188 NEW FN DOR T&T 4-6-16.pdf HFIN 4/7/2016 8:30:00 AM
HB 188
HB 188 CS WORKDRAFT FIN vG.pdf HFIN 4/7/2016 8:30:00 AM
HB 188