This chapter may be cited as the Port Facilities Development Act.

The commissioner shall adopt regulations under AS 44.62 (Administrative Procedure Act) that the commissioner considers necessary to carry out the provisions of this chapter.

Grants for the development of port facilities may not exceed

(1) 90 percent of project costs for municipalities under 5,000 population;

(2) 80 percent of project costs for municipalities 5,000 population and over.

To the extent funds are appropriated by the legislature, or from the proceeds from the sale of bonds, the state may make grants to municipalities to finance a portion of the cost of constructing local, regional, or state port facilities. The state shall participate only in those projects approved by the governor on recommendation of the commissioner.

A grant may be awarded under this chapter for a port facilities development project that includes, or combines, state ferry terminal facilities as a part of the project. However, the state shall pay the proportionate project costs attributable to the ferry terminal including but not limited to vehicle staging areas, transfer spans and aprons, passenger terminal facilities and offices, docks and other docking facilities for ferry vessels.

The division of lands in the Department of Natural Resources, subject to the applicable provisions of AS 38.05 and AS 38.10, may convey title or other interests in state land, provide for the exchange of state land, or make other arrangements with respect to state land that may be necessary to complete a project for which a state grant is approved under this chapter.

In this chapter

(1) 'commissioner' means commissioner of transportation and public facilities;

(2) [Repealed, Sec. 41 ch 32 SLA 1997].

(3) 'port facilities' means docks, wharves, bulkheads, seawalls, landfills, warehouses, staging areas, transfer spans and aprons, lifting equipment and similar structures together with the necessary equipment and facilities required to accommodate waterborne commerce and shipping, including but not limited to combined port and ferry terminal facilities;

(4) 'project costs' means the cost of financing or borrowing, site acquisition and rights-of-way, planning, engineering and designing, construction, equipment acquisition and installation, but does not include the cost of operation or maintenance of the port facilities once constructed or the cost of feasibility studies required in making application for a grant under this chapter.

(a) Before a grant may be awarded under this chapter, the commissioner shall determine that

(1) the grant is for a feasible project;

(2) the project is endorsed by resolution of the governing body of the sponsoring municipality on its own behalf, or on behalf of a service area in an organized borough if a service area is established to finance and construct port facilities and operate and maintain them once constructed; and

(3) the municipality can clearly demonstrate its ability to finance the local share of project costs.

(b) A grant may not be awarded under this chapter for a port facility development project until a study of its feasibility is conducted and submitted with the application for the grant. The project also must be justifiable on the basis of public convenience and necessity. The study shall be conducted by consultants, engineers, or other technical experts, who may be officers or employees of the municipality in making application for a grant.