For the fourth session in a row the Alaska State Legislature is contemplating the creation of a state transportation fund.
Southeast Rep. Peggy Wilson R-Wrangell has carried the legislation for the fund’s creation since 2010. This year continues with the introduction of House Joint Resolution 10. The resolution proposes amendments to the state constitution to reinstate the Alaska Dedicated Transportation Fund. Separate legislation supplies the fund with $2 billion and creates a 9-member panel to determine how the fund will be spent.
The fund is located in Article 9 Section 18 of the Alaska State Constitution.
Wilson said the state has deferred maintenance on it roads to address let alone build new infrastructure. At the same time the federal government is expected to reduce transportation funding going forward, she said. Spending state cash for transportation project will have the added benefit of cutting through some of the additional federal construction requirements.
Alaska voters would make the final decision on the constitutional amendment. The fund would operate like the permanent fund with payments cut from interest earned on the fund and on transportation-related fees and taxes deposited in the fund.
The Department of Motor Vehicles is currently funded from its receipts.
“And I didn’t want to change that,” Wilson said. Under the new legislation the division would pass its receipts through the state’s transportation fund. Placing these transportation-related funds, and others such as fuel taxes, would ensure transportation funds would go to transportation projects, she said.
The fund is expected to grow over time to account for inflation. It could add $200 million in the first two years.
The 9-member panel created by House Bill 123 would assign funds to road, Alaska Marine Highway System, airports, harbors, bike paths and other projects. The focus would be to approve projects that did not compete with federal transportation funds.
Executive Director of the Alaska Trucking Association Aves Thompson said his organization supports the formation of a state transportation fund. He said the state needs to fund necessary improvements to its roadways. With federal funding expected to decrease over coming years, the state needs to provide a reliable stream of funding to transportation improvements, Thompson said
“Truck drivers,” Thompson said, “we want their workplace to be safe.”
Alaska Teamsters Local 959 supports creation of the fund. Barbara Huff Tuckness is the organization’s director of legislative affairs. She said a constitutional amendment to reinstate the fund has been long overdue.
“When was the last major road constructions in the state?” Huff Tuckness asked. “Pogo Mine when governor Steve Cooper was in office.”
Huff Tuckness said the fund would relieve the state of total reliance on the federal government for transportation funding. It would allow the state to “start preparing for our own needs,” she said.
John MacKinnon executive director of the Association of General Contractors said the panel created by HB 123 would result in better selection of projects.
“The prioritization of projects on facts and need,” MacKinnon said, “not on politics.”
House Joint Resolution 10 Constitutional Amendment Transportation Fund was moved from House Transportation Committee on Tuesday without objection. House Bill 123 Dedicated Transportation Fund, a bill that creates the 9-member Alaska Transportation Panel, was heard and held. Committee Chair Rep. Peggy Wilson said the bill would be held for about a week.
• Contact reporter Russell Stigall at 523-2276 or at russell.stigall@juneauempire.com.
Comments (14)
Add commentAlaska does not need any more money
idling in short-term bonds earning nothing! Alaska Permanent Fund has approximately $15 Billion in cash and bonds, the CBR has $10-12 Billion in cash and short-term bonds and PERS/TERS has probably close to $8 Billion.
Alaska needs capital to be invested in our energy and transportation infrastructure, not other economies energy and transportation infrastructure.
SAY NO to more idle cash in NEW YORK Banks.
"The prioritization of
"The prioritization of projects on facts and need," MacKinnon said, "not on politics." Yeah. good luck with that!
A Better Idea
How about raising the state motor vehicle fuel tax to 50 cents a gallon, so that people who use roads the most pay the most and those that don't drive don't pay. To take the same amount from everybody is a de facto regressive tax. Alaskans pay the lowest tax in the nation but expect the most funding per person. Aren't Republicans always saying welfare breeds dependency?
Governor Cowper...
not "cooper".
another constutional amendment
Why is it that everything has become a reason to amend the Alaska Constitution? Either these legislators want more power or they want more power.
Anyone who claims an appointed commission would not be political is completely wrong. All one has to do is look at every other commission and see the politics. It begins with who are the good old boys or girls who get appointed by who. Then it becomes a trading game between commissioners whose loyalty is to some group and rarely is that group all Alaskans.
Alaska Dedicated
Alaska Dedicated Transportation Fund = cash cow for unions
Wait one second. Why should
Wait one second.
Why should public monies fund all this road construction? And why should roads have a dedicated fund for them? What about education or health care??
Let’s get some private investment monies going into roads. They benefit the most from the roads while also causing most of the damage.
dedicated road fund = cash cow for private business
Rep Peggy Wilson (R) said
"At the same time the federal government is expected to reduce transportation funding going forward."
Which is another reason why Parnell should have never turned back funding for the Alaska Class Ferry that was in hand.
kiki - Principles and
kiki - Principles and convictions - that's why Parnell "turned back funding for the Alaska Class Ferry that was in hand".
The country is broke, remember.
You're using the same logic that RINO Chris Christy in New Jersey used when accepting federal Medicaid dollars to fund BOCare - get it while the gettin's good.
That attitude doesn't bode well for our kids and grandkids.
Calypso
Calypso, he said he supposedly turned the money back so the ship could be built in Ketchikan without government strings, not because the country was broke. But dont let facts get in your way. Who knows the real reason he turned it back, but convictions and principle werent the reason, even though your rose-colored glasses may tell you so. And there's the ol kids and grandkids argument that you always use. If you truly cared about our kids and grandkids future, your Tea Party wouldnt have undone a voter passed initiative Clean Water Act, your Tea Party wouldnt be getting ready to hand 2 billion of your grandkids future over to oil companies at the same time they are already recieving Fed subsidies. Spare me the tears about kids, you could care less and we know it. As far as Christy goes, I said it before and I'll say it again, the Republican Tea Party would eat their young if they could. They put Christy on a pedestal as a hero, that is until he tried to get funding for a natural disasterand shook hands with a black President, now according to the Republican Tea Party, he's a RINO.
Directly from Parnell's minion:
"In 2010, he directed the Department of Transportation and Public Facilities (DOT&PF) to “de-federalize” the new Alaska ferry project, specifically so the Shipyard could have the first and best opportunity to build the new Alaska Class Ferry, while having to submit a competitive and fiscally-responsible bid."
http://juneauempire.com/opinion/2013-01-24/my-turn-ripple-effect-more-on...
Calypso, you must live in
Calypso, you must live in Washington state because I think you are on the doobie. Parnell, convictions in the same sentence? What you call convictions I call mental illness.
for those who did not comprehend my earlier comment
Alaska would be better off, i.e. have maximized value, in the sense of wealth creation as required in the Alaska Constitution by spending money on building energy and transportation infrastructure rather than investing in U.S. Government Debt or cash or fixed income investments of any kind. Storing Alaska's vast resource wealth in cash and bonds IN TODAY'S ECONOMIC CIRCUMSTANCE and current, internal economic need is imprudent, fiscally irresponsible, and squanders the bounty that has been harvested.
Build infrastructure that adds value to our economic future and stop investing in fixed income investments!
PS, this is from a former Fixed Income Investment Officer at the APFC. Interest rates will be going up in the next ten years, this is the time to borrow at fixed rates and invest in real things. This is NOT the time to be a lender.
Dedicated funds NO
Dedicated funding for transportation
this is really just a special interest raid on general treasury. Needs change and funding should be changed with them.
If you want a dedicated fund and users paying have the SE Marine Highway totally supported by revenues earned by the system.
Been Away From the Fund Too Long, Brad.
Brad,
You've been away from the Permanent Fund too long...it has passed you and your traditional-investment-thinking by. You are also misleading others with your erroneous posts and misleading phrases.
In your first post, you incorrectly stated that the Permanent Fund has about $15 million in cash and bonds...well, that's waaaay more than the Fund has invested in those instruments. You already know you can go to apfc.org to get all of this info! Why didn't you?!?!
As of the 1/31/13 Monthly Performance Report, the APFC has $8.7 million in domestic fixed income which has a 12-month return of 4.71% (pretty average for any 12-month time period for FI). Also, you said "idling in short-term bonds earning nothing". Now, you know this is false! First of all, the duration on the FI portfolio is currently over 7 years, that's not short-term! And if it actually was "short term bonds" as you said, Alaskans would gladly take a 4.7% return on short-term instruments!
As of the 1/31/13 Monthly Performance Report, the APFC has only $600 million in cash. Pretty much average for this time of year to help with the dividend liability and for other areas of funding needs.
As of the 1/31/13 Monthly Performance Report, the APFC has about $700 million in HIGH YIELD debt, which had 12-month account returns of 11.7% and 13.2%. I'll take those returns any year on any investment type!!! Definitely not idling!!!
As of the 1/31/13 Monthly Performance Report, the APFC has just over $1 billion in mezzanine debt and private credit. Although internal rates of return are not available for the mezzanine debt accounts, the "opportunities" account for private and high yield debt has a 12-month return of 11.1%, which is also fantastic.
So, you incorrectly stated the amount of the Permanent Fund's investments in fixed income securities and cash, and you incorrectly stated that it's "idling in short-term bonds earning nothing" when it is in fact having an excellent run right now and is nowhere near idling! It's definitely not a $15 billion T-bill portfolio!!!
I thought you were still in the investing business?! If so, you would know the basic positives of diversification! Also, you might want to look into high yield corporates, international markets (especially emerging markets), and private debt. Sounds like the Fund has left you back in the 90s, while it forges ahead with prudent investing using a good risk model.
Please don't use incorrect information and terminology to discount an institution that continues to make Alaskans billions of dollars annually. The fixed income investments at the Permanent Fund are definitely not "idling in short-term bonds earning nothing"!!!