LOS ANGELES - The Knik Arm Bridge project took another step forward on Friday after the Alaska Legislature passed a bill authorizing a construction plan, which includes transferring control of the bridge to the state Department of Transportation.
After a previous version of the bill failed in the House, the Legislature was able to reach a compromise five days after it was scheduled to adjourn.
Key changes to House Bill 23 include authorizing the Department of Transportation and Public Facilities to procure the design/build contract and to apply for the Transportation Infrastructure Finance and Innovation Act loan, rather than the Knik Arm Bridge and Toll Authority.
The bill also amends the powers of KABATA by removing its authority to incur debt, issue bonds, apply for permits, perform engineering and design studies, and exercise the power of eminent domain.
Control would be transferred back to KABATA upon construction of the bridge.
"We're very happy that the project's moving forward," said Kevin Hemenway, chief financial officer of KABATA. "Our goal is to get this project built and it seems very clear now that the momentum is there. If these political changes needed to happen to get the political support, I'm all for it."
Under the previous version of HB 23, KABATA would have applied for the TIFIA loan of up to $350 million.
Hemenway said that transferring authority to the DOT to apply for the loan might actually increase the chances of getting approved since the U.S. Department of Transportation would be lending to Alaska, which has the highest credit ratings, instead of a single-purpose entity.
"Moving it to the DOT basically makes it a recourse loan to the state," Hemenway said. "There's no direct revenue risk in that Alaska's credits are triple-A and its appropriation credits are also very high."
Other funding portions of the $900 million project remain the same under the revised plan. Up to $300 million in bonds will still be issued by the Department of Revenue and around $300 million will come from federal and state appropriations.
The previous funding plan had been approved by the Senate earlier this month, but failed when it went back to the House for a concurrence vote last week.
Lawmakers from the House and the Senate were appointed to a conference committee to work out bill differences, where they came up with the current version that passed in a 28-10 House vote and 14-4 Senate vote on Friday.
"The Knik Arm Crossing is a vital infrastructure project that will open up the lower Susitna Valley and help create an alternate route between our largest population bases," Mark Neuman, R-Susitna Valley, the bill's sponsor, said after the bill passed. "It's about safety and saving lives by providing another way in and out of our communities."
Plans to build a 1.7-mile bridge over the Knik Arm of Cook Inlet, connecting Anchorage to the Matanuska-Susitina Borough, have been in the works for decades. Prior to the publicly-funded $900 million financing plan, the project had been proposed as a public-private partnership, but failed to garner legislative support.
KABATA has led efforts to construct the bridge since it was created by the legislature in 2003. Hemenway said it would continue working on the traffic and revenue study, expected to be complete in mid-July.
They will also continue working on right of ways and permits, handing these processes over to the DOT, and continuing to coordinate closely with them on the procurement for the design/build contract.
"We work very closely with the DOT — we're actually organized under the DOT," Hemenway said. "So in many ways the changes are incremental, not dramatic."
KABATA's board includes both the Commissioner for the Alaska Department of Revenue, Angela Rodell, and the Commissioner for Highways and Public Facilities, Pat Kemp.
The bill now heads to Gov. Sean Parnell for his signature.
