KENAI — The proposed cuts in Gov. Bill Walker’s fiscal year 2018 budget would fall heavily across the state, including broad reductions to the Alaska Department of Transportation and Public Facilities’ design department.
The $4.2 billion draft budget released Dec. 15 would cut 76 positions from the department, primarily engineers, interns and other staff from the internal design division. The cuts are part of an “aggressive plan” to transition the design of more DOT construction projects to private contractors, according to the budget detail. Shifting to private contractors would help leverage more federal dollars for transportation projects, according to the budget detail.
“The department will increase work to the private sector while shrinking internal design staff,” the budget detail states. “This has the added advantage of bolstering the private sector economy. By operating with more contract staff and fewer in-house engineering staff, the department will balance public and private sector specialized expertise and be able to quickly scale up and scale down based on available funding.”
The plan comes in response to a directive from the administration, said Jeremy Woodrow, a spokesman for the DOT commissioner’s office. It’s also not the last reduction — part of the plan calls for the reduction of up to 300 additional positions in the fiscal year 2019 budget, he said.
Not all the cuts are strictly related to design — they include the work on right-of-ways and other pre-construction work, Woodrow said. It isn’t clear at present how many positions could be cut, which is why the language included “up to” 300, he said.
“There are some things the department is going to be working on with the Legislature and the administration over this session and over the coming months,” he said.
Private contractors already do about 55 percent of all the department’s design work. The goal is to get 100 percent of it to be done by private contractors by fiscal year 2019, according to the budget detail.
“Department of Transportation positions that remain after this initiative will be responsible for project management and contractor oversight as opposed to hands-on engineering work,” the budget detail states.
The savings are still uncertain because the funds that would be saved by eliminating employees would be transferred to use for private contractors, said Pat Pitney, director of the governor’s Office of Management and Budget. The goal is to see if savings may come from using private contractors rather than in-house work, she said.
“The savings is efficiencies,” she said. “Can we get more dollars for the products that we have? The funding is the same. Can we get more projects if we get more federal matching?”
Going out to contractors for design work also offers a wider range of expertise and viewpoints, Pitney said.
There are two unions represented in the positions that would be eliminated, so the state will have to complete a feasibility study to look at the effects, Woodrow said. Pitney said there will be “an expectation” that the state complete one, but said it would not have to be done beforehand.
She said she isn’t sure if the state had gotten to the point where it had to do a similar feasibility study before, though if the state decides to privatize the Alaska Pioneer Homes — a debate currently going on — that will also require a feasibility study.
Most of the jobs proposed for elimination are in Anchorage, Juneau and Fairbanks, the headquarters for DOT’s three regions, though a few are in outlying areas like Sitka and Kodiak. Woodrow said the department would work on finding answers for some of the uncertainties.
“Bottom line is, this is an aggressive policy, we have the directive from the administration to work forward toward it,” he said. “But there’s a lot of unanswered questions that will be worked out in the coming months.”
DOT, the third largest employer in the state, has already gone through significant budget cuts. Budget reductions have led to the closures of maintenance stations, the staggering of road maintenance and rounds of layoffs.
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