Call to Order and Roll Call
The third meeting of the Budget Review Subcommittee on Transportation of the Interim Joint Committee on Appropriations and Revenue was held on Thursday, September 26, 2013, at 10:00 AM, in Room 129 of the Capitol Annex. Representative Leslie Combs, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Jimmy Higdon, Co-Chair; Representative Leslie Combs, Co-Chair; Senator R.J. Palmer II; Representatives Hubert Collins, Tim Couch, Robert R. Damron, Jim Gooch Jr., Keith Hall, John Short, and Jim Stewart III.
Guests: Representatives Kim King and Susan Westrom. Dave Adkisson, President and CEO, Kentucky Chamber of Commerce. Transportation Cabinet: Mike Hancock, Cabinet Secretary; Tammy Branham, Executive Director, Office of Budget and Fiscal Management; and Nancy Albright, Director, Division of Maintenance, Department of Highways.
LRC Staff: Chuck Truesdell, Jennifer Anglin, and Spring Emerson.
Chair Combs called for a motion to approve the minutes of the last meeting, which was held on July 25, 2013. A motion was made by Representative Collins and seconded by Representative Hall, and the minutes were approved without objection.
Discussion of a Report by the Kentucky Chamber of Commerce
Dave Adkisson, President and CEO, Kentucky Chamber of Commerce, provided an overview of the report Private Solutions to Public Problems: Partnerships to Build a Better Government, which outlines some of the ways Public-Private Partnerships (P3s) can be used as possible funding solutions for various projects throughout the Commonwealth.
In response to questions from Representative Collins, Mr. Adkisson said in order to prevent a partner from not keeping up with maintaining the roads, an attorney should be utilized to build safety points into the written contract. He said state government is so strapped for money that it cannot promote the assets it has in order to bring in more revenue.
In response to questions from Representative Damron, Mr. Adkisson said legislation would be necessary in order to allow for unsolicited proposals which would mean the creativity of the private sector would be brought to bear. This could be a long-term advantage for Kentucky. Chair Combs stated that the use of P3s could be broadened to include other areas.
In response to a question from Senator Higdon, Mr. Adkisson said the efficiency of the process is part of the reason for the savings realized at the dormitory building at Eastern Kentucky University. A comprehensive system with an ongoing dialogue to find the best way to serve the public would be ideal.
Representative Damron stated that the best example of this type of partnership would be at the University of Kentucky with the construction of their dorm rooms, which was achieved at a higher quality, faster speed, and at a lower cost than the university would have been able to do on their own. UK has a strong business model, and it has proved to be a successful example of P3 use. If P3s are utilized in Kentucky, the legislation should be all-encompassing to allow innovation, not only in roads and transportation issues, but in the Parks system and other places as needed. The office should be located in the Governor’s office and should be expanded down to allow municipalities and counties to have the same types of arrangements and services at the local level.
Representative Hall said he is always open to bigger and better ways to serve the public, and the use of P3s could be a good way to do that. The City of Pikeville utilizes a P3 for several services and it has been successful. Mr. Adkisson suggested that the power of the private community be unleashed in order to achieve the desired result.
Maintenance Budget Update
Secretary Mike Hancock, Tammy Branham, and Nancy Albright provided an update on the Transportation Cabinet Maintenance Budget.
In response to a question from Representative Couch, Ms. Albright said a database is maintained which includes a ranking system for prioritizing guard rail needs. A priority list of the 295 miles of guardrail needing maintenance or replacement will be provided to the members at a later date.
In response to questions from Representative Collins, Ms. Albright said contractors are required to retrofit their trucks, which includes installing hydraulics, electronics, v-box spreaders, distributors, certain salt-spreading calibration equipment, radios, and plows. The cabinet pursues reimbursements from vehicle liability insurance when guardrails are damaged in accidents, but a lot of the time no accident report is available. Representative Collins stated that guardrails save lives. Representative Couch agreed, adding that the prevention of highway deaths should be a priority.
In response to a question from Representative Stewart, Ms. Albright said wood posts are used for guardrails at times even though steel lasts longer. She said the aesthetic quality was important in certain instances, and when the decision is made to use wood posts, the maintenance requirements are factored into the cost.
In response to a question from Representative Couch, Ms. Branham said the maintenance program has carry forward authority for encumbrances and any balance left over, due to the program being seasonally driven.
In response to questions from Representative Stewart, Ms. Albright said highway medians are fertilized and seeded at times in order to control erosion and keep noxious weeds out. She will provide the amount of that expense at a later date. Ms. Albright said the Department of Highway Maintenance does not have any long-line striping machines, and the work is contracted out at a cost of $14 million to $15 million per year statewide.
In response to questions from Senator Higdon, Ms. Albright said the cabinet has been asked occasionally about leasing the right-of-ways for growing and mowing hay, but due to the terrain and soil quality, it is not always possible.
In response to a question from Representative Collins, Ms. Branham said Kentucky shares the cost of the Cumberland Gap Tunnel with Tennessee at a 50 percent split, and the current biennial contract is just under $5 million per year.
Representative Collins remarked that coal patches in potholes do not last very long. He said maintenance of ditches and culverts contributes to the life of the road, and increasing the maintenance budget is necessary for highway safety.
There being no further business before the subcommittee, the meeting was adjourned at 11:32 AM.