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Senator says he won't move bond bill for extra transportation projects

Posted: Sunday, May 06, 2001

JUNEAU (AP) -- The chairman of the Senate Transportation Committee on Saturday declared the death for this year of a $381 million bond package for extra transportation projects.

Sen. John Cowdery, R-Anchorage, said the projects, backed by Grant Anticipated Revenue Vehicle, or GARVEE bonds, will overheat the Alaska economy.

''We don't want to heat it up more,'' he said during a break in the Senate floor session.

The Senate already has approved a $1.3 billion capital budget that directs $906 million to the Department of Transportation and Public Facilities for roads, airports, ferries and other projects.

House Bill 191 would have added more with GARVEE bonds, sold to investors and backed with future federal transportation grants.

Legislators rejected GARVEE bonds last year. Gov. Tony Knowles put forth the idea again this year. HB 191, approved by the House, contained about 85-90 percent of the governor's projects, according to the department.

Though GARVEE projects add bonding expense to the cost of construction, they could save state money in the long run, according to the department. Projects low on the department's priority list would be built before inflation boosted their costs.

Department officials also say money generated by the sale of the bonds could be banked and interest could be used to pay the state's 10 percent match of federal payments, saving general fund money.

But Cowdery said there's so much construction work in Alaska now, companies are having trouble finding workers.

With so many projects available on the street, he said, contractors will raise their bids, inflating the cost of public works.

Cowdery also said an abundance of projects will simply attract Outside companies, adding little to the Alaska economy.

''I don't want to attract contractors from overseas or from out of state,'' Cowdery said.

Cowdery also expressed philosophical problems with GARVEE bonds. He said the Alaska Constitution puts the power to appropriate into the hands of legislators and approving GARVEE bonds commits future legislators to making payments.

''I don't think that's legal,'' he said. ''You get three lawyers, you get three opinions.''

Cowdery also said it's not right to allow the current administration to spend money that will be received when another administration is in office.

''They may have different priorities, whoever that might be,'' Cowdery said.



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