Legislature(1999 - 2000)
04/14/2000 06:22 PM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 98(HES) am
"An Act relating to contracts for the provision of
state public assistance to certain recipients in the
state; providing for regional public assistance plans
and programs in the state; relating to grants for
Alaska Native family assistance programs; relating to
assignment of child support by Alaska Native family
assistance recipients; to paternity determinations and
genetic testing involving recipients of
This was the first hearing for this bill in the Senate
Finance Committee.
JIM NORLAND, Director, Division of Public Assistance,
Department of Health and Social Services, testified that
this bill would help to continue the progress of welfare
reform in the State Of Alaska.
Mr. Nordland stated the authority to run the federal
programs at the state government level is one of the main
reasons for welfare reform's success in Alaska and other
states. He explained that state governments have been able
to use this power to dramatically reduce caseloads, help
families return to work and out of poverty. In exchange for
the flexibility, he said states are receiving a specific
amount of money from the federal government, known as a Cap
Block Grant. He attested this arrangement between the
federal government and Alaska's government has worked very
well to reduce welfare dependency.
In addition to granting ownership of welfare programs to
the states, Mr. Nordland stated the federal law allows
tribes in the Lower 48 and the 13 regional Alaska Native
non-profit organizations to run their own welfare programs
as well. He shared that funding for the Native-operated
programs is taken from the amount allocated to the state.
Mr. Nordland noted that while states are required to
participate in funding the state-operated welfare programs,
there is no requirement in federal law for any entity to
contribute to the funding of Native-operated programs.
However, he said that the state contributes approximately
fifty percent of the funds needed to operate the Native-run
programs.
Mr. Nordland then explained that this bill allows for the
expenditure of state funds for Native-operated welfare
programs. He stressed that the only eligible organizations
that can receive these funds are the 13 regional non-profit
Native organizations.
Mr. Nordland added that the intention is to transfer from
the state, the amount of money needed to pay for benefits,
administration, child care, work services, etc. He said
this money is currently being paid by the state to serve
the same participants in programs that would now be run by
Native organizations. He pointed out this is the reason for
the bill's zero fiscal note.
Mr. Nordland shared that the Tanana Chiefs Conference
(TCC), an Interior Alaska organization operating under the
Doyon Native Corporation is currently operating a welfare
program. He said that the state could appropriate federal
funding to this organization so long as the program it
operates is the same as the one operated by the states'
Alaska Temporary Assistance Program (ATAP). However, he
stated that TCC had planned to run its program differently
than the state, and without this legislation, would be
unable to receive funding. He deferred to a representative
from the TCC to detail the culturally relevant approach of
the Native-operated program.
Mr. Nordland stressed that the department supports giving
flexibility to the Native organizations so that the
programs can be run with more local control and with better
cultural relevancy.
Mr. Nordland qualified there are limits as to how different
the Native-operated programs could be from the state-
operated program. He stated that Alaska's congressional
delegation inserted language into federal law requiring
Native programs to be comparable to the state program. He
said the department has worked with the Native
organizations to design the comparability criterion, which
have been approved by the US Secretary of Health and Human
Services.
Mr. Nordland summarized that if this legislation passes,
there would be a Native-operated program comparable to the
state program but somewhat different in order to meet local
and cultural circumstances.
Senator Green then asked if this legislation requires
federal "blessing" before the funds could be allocated.
Mr. Nordland affirmed the plan does need to get federal
approval.
Mr. Nordland concluded his presentation saying that the
department supports the legislation because it is believed
the welfare reform efforts could be more successful if the
Native organizations are allowed to operate their own
programs. He attested that the organizations know the needs
of their region and the people and that the programs could
be run more effectively than the state could.
Senator Leman asked if federal law allows allocations to
other organizations besides Native organizations. He
referred to earlier discussion he had with the witness on
this matter where he shared his desire to broaden the
localization of the welfare reform programs.
Mr. Nordland replied there is a specific provision in
federal law applying only to tribes in the Lower 48 and
Native Alaskan organizations. He advised however, that
there is no reason the state cannot contract the programs
out to municipalities or other entities. In fact, he said
many states have privatized the services to for-profit
organizations.
Senator Green asked if privatization or shifting the
programs to the local level would require federal approval
as well.
Mr. Nordland answered federal approval would not
necessarily be required.
Amendment #1: This amendment inserts a new subparagraph on
page 11, line 22 to read as follows.
(4) establish the same maximum number of
months of benefits as is established for the
state program under AS 47.27.015 (a)(1); and
(5)
[This amendment was not offered at this meeting but was
discussed.]
Senator Adams requested the department comment on the
proposed amendment. He described it sets uniform standards
for the maximum amount of benefits that could be collected
by participants of either the state or Native-operated
welfare programs.
Mr. Nordland stated that the department supports the
amendment, referring to his earlier statement about the
comparable criterion between the two programs. He noted
that the issue of consistent benefit eligibility was
overlooked when the criterion was developed. He told the
Committee that federal law allows the Native organizations
to negotiate with the federal government on the length of
time benefits could be collected by participants. He said
the reason for this allowance is to give some Indian
reservations an exemption from the 60-month lifetime
benefits limit. He stressed that this exemption was outside
the bounds of the comparability arrangement between the
state and Alaska Native organizations. He said the
department supports holding Native-operated programs to the
60-month limit just as the state-operated program is. He
commented that this amendment "plugs a loophole in this
bill."
Mr. Nordland stressed that villages with an unemployment
rate of over 50 percent would be exempt from the 60-month
limit whether the residents participate in a state-operated
or Native-operated program. He expressed that this
amendment does not apply to specific communities but rather
the operator of the program. This is to prevent
participants of a Native-operated program who do not live
in a community with more than 50 percent unemployment to
receive more than 60 months of benefits, according to Mr.
Nordland. In this manner, he said, the exemption would be
based on the community itself rather than the operator of
the program serving it and possibly other communities as
well.
Co-Chair Torgerson asked for an explanation of Section 5.
Mr. Nordland replied that this section was part of changes
made to the bill by the House of Representatives relating
to child support payments. He believed the language to be
conforming to other child support enforcement statutes.
KRISTEN BOMENGEN, Assistant Attorney General, Human
Services Section, Civil Division, Department of Law,
testified that this section is the result of a
comprehensive review of the child support provisions. The
purpose, she said is to ensure that child support payments
that are collected on behalf of participants who are
receiving public assistance under Native-operated programs
are distributed to that Native organization. She stated
that the intent is to remove any possible barriers to
making appropriate distributions.
Co-Chair Torgerson asked if the child support payments only
included those collected under court order.
Ms. Bomengen replied all child support payments are subject
to distribution to the program's operator.
Co-Chair Torgerson wanted to know if "petitioning the
court" in the language relating to enforcement of child
support orders could include tribal courts.
Ms. Bomengen confidently stated that is not the intent to
petition any tribal court.
Co-Chair Torgerson wanted assurance.
Ms. Bomengen expressed it is not a function of the Division
of Child Support Enforcement to operate in tribal court.
Instead, she said the agency follows the rulings of state
court. She said there is no intention to expand the
agency's efforts into tribal courts.
Co-Chair Torgerson acquiesced, but asked about the recent
Supreme Court ruling in John v. Baker, which authorizes
tribal courts to issue child support orders.
Ms. Bomengen needed an opportunity to review the court case
before giving a specific opinion on the matter.
Co-Chair Torgerson stated he wanted an understanding of the
impact of the court decision on this legislation. He then
referred to Section 21 that allows the department to adopt
program standards that vary by region. He wanted to know
why standard practices would not be adopted so all Alaskans
are treated equally.
Mr. Nordland responded that the language in Section 21
conforms to other sections of the bill to allow regional
public assistance programs to be established by the
department. He shared that the motivation is to prevent the
department from having to create a separate program for the
few non-Native residents of a Native village, served by a
Native-operated welfare program. He stated that this
provision allows the non-Natives to be served by Native
organizations.
Co-Chair Torgerson understood the intent but claimed the
language instead allows the department to vary program
standards by region. He thought this provision was too
broad-based.
Mr. Nordland responded that the intent is to adopt the
program standards of the Native-operated plan, which would
be comparable yet different than the state-operated
program. In doing this, he said, all residents of a
community could be served by the Native-operated plan.
Ms. Bomengen addressed a concern raised in other committees
regarding a potential equal protection question. She
detailed that the bill contains a requirement that in any
area in which a Native corporation is operating a welfare
program, eligible Alaska Natives must seek their services
from that program and not from a state-operated program.
She spoke of funding for the participant as well as the
Native program in these cases. She suggested the approved
Native-operated programs should be identical to one that
the state would operate if it were to do so.
Ms. Bomengen then explained how the Alaska court applies a
"sliding scale test" to any equal protection challenge.
This test, she said is used to determine whether a greater
or lesser burden is placed on the state to justify a
classification of individuals to be served by one plan or
another, depending on the importance of the individual
rights involved. She detailed how the court determines what
kind of weight should be given to the constitutional
interest impaired by the legislation, examines the purpose
of the legislation, and evaluates the state's interest in
the means employed to further the goals of the state.
Ms. Bomengen stressed that an equal protection challenge to
this legislation would probably claim there to be an
impermissible classification based on the race of the
individual. She said the state's response would then be
based on other equal protection cases that have addressed
the same distinction. She explained this distinction was
created by a federal act, which is born out of the federal
government's trust relationship and responsibilities to
American Indians and Alaskan Natives. Therefore, she
surmised the distinction would be a quasi-political issue
based on the unique political status of indigenous peoples
and not considered a racial classification.
Ms. Bomengen continued detailing why an equal protection
challenge would not succeed saying that, regardless of
whether the state or a Native organization operated the
program, the participant's benefits would not be affected,
services would not be denied and the subsequent impact on
the family would be insignificant. She said this is because
of the comparability requirements for both programs under
state and federal law.
Ms. Bomengen relayed a suggested amendment to the bill made
to the House of Representatives that would allow an
individual who is directed to the Native-operated program
to request service under the state-operated program. A
successful request, she said would demonstrate a compelling
interest to receive services from the state rather than the
Native organization. She added that the Department of
Health and Social Services would develop standards for this
exception in regulation.
Senator Phillips asked if there was a legal opinion on this
matter from the Division of Legal and Research Services.
Co-Chair Torgerson said there was not but noted a request
would be submitted.
Co-Chair Torgerson acknowledged the fiscal note was zero
but wanted information about the federal grant funds and
necessary general fund money to implement the new programs.
Mr. Nordland first commented that not all of the 13
regional Native corporations are interested in operating
welfare programs. He noted that there is already one
Native-operated program established and that the Tlingit-
Haida Corporation and the Association of Village Council
Presidents have expressed interest in establishing their
own program. He then explained that the department would
transfer not only the benefits portion of the welfare
programs to participating Native corporations, but also a
portion of the administrative funds as well. He admitted
this was not easy for the department to do because of the
impact on its administrative abilities. However, he said in
the long run the programs would be run more effectively
with higher caseload reductions.
Mr. Nordland stressed this bill has no impact on the
general fund, either positive or negative.
Senator Wilken wanted to understand the flow of the funding
from the federal level to the beneficiary.
Mr. Nordland detailed that the Native-operated program must
first have a plan approved by the federal government, which
requires some state funding to make the plan comparable to
the state-operated plan. Once the Native-operated plan is
approved, he said a portion of the federal funds provided
to the state go directly to the Native organization. He
expressed that the intent of this legislation is to allow
the state funds to be allocated to the Native organizations
so those programs can be operated at the same level as the
state-operated program.
Senator Wilken wanted to know how the distribution of
federal funds between the state and the Native
organizations was calculated.
Mr. Nordland responded that the amount of federal money
spent on Native clients during the federal fiscal year
1994, in the specified region, is reported to the federal
government as the percentage of the state's block grant to
be allocated to the Native organization. He qualified that
the amount could change in the future when the Temporary
Assistance for Needy Families (TANF) law changes, but would
not change before then.
Mr. Nordland continued that the general funds provided to
the organization are separate from the block grant funds.
He explained further how the TANF program is funded with a
fixed federal block grant, of which the state must expend
at least 80 percent of what was spent in 1994 to
participate in the TANF program without severe penalty. He
shared that the state is currently meeting the required
expenditure amount.
Senator Wilken asked how many families this legislation
would affect.
Mr. Nordland listed the TCC program currently serves
approximately 500 families, the Tlingit/Haida organization
serves about 500 families and ABCP would serve
approximately 900 families if it takes over the welfare
program in their area. He said this represents about 20
percent of the entire caseload in the state.
Senator Wilken asked why the transfer of these 1900
families would not make the department's operating costs
smaller.
Mr. Nordland responded that the department still
administers Medicare, Food Stamps, Adult Public Assistance
and other programs. It was difficult for him to say exactly
how the department would manage the reduction in
administrative funds and still operate these other
programs. He used Bethel as an example where over 95
percent of welfare clients are Native and the department
would therefore reduce department staff.
Senator Wilken thought the fiscal note should show a
reduction in state bureaucracy.
Mr. Nordland responded that there is a reduction in the
state bureaucracy but not a reduction in the budget. He
stated that the general funds would be paid to employees of
the Native corporations to operate the program rather than
to state workers. He stressed that the amount of spending
stays the same.
Senator Wilken then asked the purpose of the legislation.
Mr. Nordland answered the reason for transferring welfare
programs to Native organizations is for many of the same
reasons for having local school districts across the state.
That, he expressed is to have some local control with the
programs "closer to home."
Senator Wilken asked if there would ever be an instance of
a non-Native family not provided with services that a
Native family is provided or visa-versa.
Mr. Nordland assured that one entity or another would serve
everyone who is eligible for public assistance.
BARBARA NICKLOS, Director, Division of Child Support
Enforcement, Department of Revenue, testified via
teleconference from Anchorage that she was available to
answer questions regarding the disbursement of child
support payments to the Native organizations who operate a
public assistance program. She assured that the language
pertaining to this allowance does not relate in any way to
tribal court.
DON SHIRCEL, Director, Family Services Division, Tanana
Chiefs Conference testified via teleconference from
Fairbanks listing his education and experience
qualifications. As a social service professional, he
strongly supported both SB 80 and HB 98.
Mr. Shircel spoke in great detail of the early success of
the TCC operated public assistance program and the
satisfaction it has given Native leaders.
Tape: SFC - 00 #89, Side B 7:09 PM
Mr. Shircel read a letter to TCC from a former client as
follows. [Copy not provided.]
Hello,
I'm writing this letter to everyone to let you know
that I have a new permanent job and I'm going to be
O.K. from here on out. I'm also writing to thank each
person for all they have done for my family and I. I
know that there's a lot of work that's put into each
individual case and I really want to thank you for all
that you've done to help me become more self
sufficient. This letter is not only a letter to thank
you for all your hard work, but it's also a letter to
request that I have my case closed. I do realize that
all my benefits will stop and I feel I'm prepared for
this. Once again, thank you and may Lord Jesus bless
you for what you do to help others.
Mr. Shircel expressed that he could not think of a better
way to convey to the Committee what the legislation is
trying to accomplish than this letter could. He believed
that with the passage of the bill, his organization could
have an even greater impact and get more "bang out of each
welfare buck."
Senator Adams asked what does TCC do for a Caucasian
individual living in a rural community in the region, who
otherwise qualifies for the TANF-based program.
Mr. Shircel responded that currently the individual must
apply for services through the state because TCC does not
have the authority to serve him or her.
Senator Adams asked if that qualified Caucasian has a
choice between the Native-operated or the state-operated
public assistance program.
Mr. Shircel answered that without this legislation, that
person does not have a choice but must be served through
the state-operated program.
Senator Green commented that four years ago during
deliberations of SB 98, relating to welfare reform,
suggestions were made to address alcohol, drug abuse,
parent's involvement with children, and possible domestic
violence issues conditional on receiving benefits. She
recalled that on every count it was deemed this was a
violation of individual freedom. She stressed that if
allowances for these issues to be combined in the public
assistance for the Native-operated programs, then the same
allowances should be made for every public assistance
program in the state.
Co-Chair Torgerson requested an improved sectional analysis
from the department and a legal opinion on the equal
protection clause from the Division of Legal and Research
Services.
Senator Green also requested a side-by-side comparison of
the current role of the Division of Child Support
Enforcement and the proposed interaction with the Native-
operated programs, as it relates to TANF and how the funds
circulate. She wanted to know if any funds would be lost if
the legislation passed.
Co-Chair Torgerson ordered the bill HELD in Committee.
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