04/18/2009 08:30 AM House FINANCE

HOUSE BILL NO. 157                                                                                                            
                                                                                                                                
     "An Act  amending the State  Personnel Act to  place in                                                                    
     the  exempt  service  the  chief  economist  and  state                                                                    
     comptroller in  the Department  of Revenue  and certain                                                                    
     professional  positions concerning  oil and  gas within                                                                    
     the  Department  of   Natural  Resources;  relating  to                                                                    
     reemployment  of  and  benefits  for or  on  behalf  of                                                                    
     reemployed  retired teachers  and  public employees  by                                                                    
     providing  for  an  effective   date  by  amending  the                                                                    
     delayed effective date  for secs. 3, 5, 9,  and 12, ch.                                                                    
     57,  SLA  2001 and  sec.  19,  ch.  50, SLA  2005;  and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
10:19:57 AM                                                                                                                   
                                                                                                                                
Co-Chair  Hawker MOVED  to ADOPT  the  CS for  HB 157,  Work                                                                    
Draft 26-GH1035\S, Wayne, 4/18/09, as a working document.                                                                       
                                                                                                                                
Representative Gara objected for discussion.                                                                                    
                                                                                                                                
Co-Chair  Hawker gave  some history  of the  legislation. He                                                                    
reported that several  amendments to the bill  had been made                                                                    
in the  Senate, which resolved contention  between concerned                                                                    
parties. Expedition  of the bill would  allow the Department                                                                    
of  Law to  retain four  attorneys, who  would otherwise  be                                                                    
laid off.                                                                                                                       
                                                                                                                                
10:22:13 AM                                                                                                                   
                                                                                                                                
Representative  Gara asked  if the  bill reflected  the most                                                                    
current version in the Senate. Co-Chair Hawker replied yes.                                                                     
                                                                                                                                
Representative Gara removed his objection.                                                                                      
                                                                                                                                
CS for HB  157, Work Draft 26-GH1035\S,  Wayne, 4/18/09, was                                                                    
ADOPTED as a working document.                                                                                                  
                                                                                                                                
GINGER  BLAISDELL,  DIRECTOR,   DIVISION  OF  ADMINISTRATIVE                                                                    
SERVICES,  DEPARTMENT OF  REVENUE,  explained  that she  had                                                                    
been   asked  to   carry  the   bill   by  three   different                                                                    
departments; The  Department of Administration  (DOA), which                                                                    
does the  retire/rehire portion of the  bill, The Department                                                                    
of Revenue (DOR), which has  requested two positions go into                                                                    
exempt  status,  and  The Department  of  Natural  Resources                                                                    
(DNR), which was requesting full  time exemption for 23 part                                                                    
time exempt  positions. The  CS deleted  Section 1  from the                                                                    
original bill,  which amended  AS 39.24.110,  moving certain                                                                    
positions  from one  sub-section to  another, changing  what                                                                    
was  called "special  inquiry", and  was a  temporary exempt                                                                    
status, into a full-time  exempt status. The positions would                                                                    
be retained  within DNR. In  the DOR, Section 2  was changed                                                                    
by eliminating  the Chief  Economist position.  The position                                                                    
has  been vacant  for  a year  due to  a  lack of  qualified                                                                    
applicants  and   the  low  salary  offered   for  qualified                                                                    
applicants.  The  state   comptroller  position  remains  as                                                                    
originally  requested. Changes  in the  retire/rehire sunset                                                                    
extension would require a person  to be retired for 90 days,                                                                    
rather than  30, before rehire. Another  change requires the                                                                    
teachers'  retirement  system   and  other  government  PERs                                                                    
participants to follow more  rigorous recruitment efforts. A                                                                    
third change  reduces a minimum of  five eligible applicants                                                                    
to three  eligible applicants, before considering  a retiree                                                                    
for a  position. The  fourth request  changes the  sunset of                                                                    
the program from four years to one year.                                                                                        
                                                                                                                                
10:25:44 AM                                                                                                                   
                                                                                                                                
Vice-Chair  Thomas asked  who had  requested the  changes in                                                                    
the  bill. Ms.  Blaisdell replied  that the  bill originated                                                                    
from   the  governor's   office,   but  several   committees                                                                    
contributed to the changes.                                                                                                     
                                                                                                                                
Co-Chair Stoltze  warned that  care should  be taken  to not                                                                    
breaching  bicameral prerogatives.  He felt  that this  bill                                                                    
was the best vehicle to please both bodies.                                                                                     
                                                                                                                                
Representative Gara asked if the  bill allows for the rehire                                                                    
of  retirees   across  the   board  without   exempting  any                                                                    
agencies. Ms. Blaisdell replied in the affirmative.                                                                             
                                                                                                                                
Representative Gara  asked if the  rehired retiree  would be                                                                    
receiving   pension  benefits   and  medical   insurance  in                                                                    
addition  to being  a rehire.  Ms.  Blaisdell answered  yes.                                                                    
Representative Gara asked  if there was a cost  to the state                                                                    
in those  situations. Ms. Blaisdell  said that  the position                                                                    
would be  filled either way, by  a retiree or a  new hire. A                                                                    
retiree  would  only  be  rehired  if  they  were  the  most                                                                    
qualified applicant.  She reiterated  the sideboards  in the                                                                    
bill that regulate the rehire of retirees.                                                                                      
                                                                                                                                
10:29:46 AM                                                                                                                   
                                                                                                                                
Representative  Kelly asked  if the  intent of  the original                                                                    
bill had  been changes  by the  CS. Ms.  Blaisdell explained                                                                    
that one major  difference is the 90  day minimum retirement                                                                    
requirement  before  a  retiree   is  eligible  for  rehire.                                                                    
Representative Kelly  asked who  generated the  changes. Ms.                                                                    
Blaisdell  replied that  the changes  were generated  by the                                                                    
administration and the Senate State Affairs Committee.                                                                          
                                                                                                                                
Representative Kelly expressed support for the bill.                                                                            
                                                                                                                                
Representative Gara  asked if  the bill  applied to  Tier IV                                                                    
employees who retire. Ms. Blaisdell  shared that she did not                                                                    
know of  any Tier  IV employees that  had been  eligible for                                                                    
retirement.                                                                                                                     
                                                                                                                                
10:31:55 AM                                                                                                                   
                                                                                                                                
Representative  Joule interpreted  that the  bill encouraged                                                                    
local rehire. Ms. Blaisdell said that was correct.                                                                              
                                                                                                                                
Representative  Kelly  said  that  he had  heard  that  some                                                                    
people  "fell through  the cracks",  he  wondered what  that                                                                    
meant.   Ms.  Blaisdell   answered  that   there  were   two                                                                    
provisions  in the  bill; the  retire/rehire program,  which                                                                    
includes  all participants  who are  eligible to  be retired                                                                    
under  PERs or  TERs, would  be  included as  long as  their                                                                    
municipality  offered the  program. The  elimination of  the                                                                    
positions considered  under exempt  status, are  not retired                                                                    
individuals,  but  positions  that have  been  difficult  to                                                                    
fill, and do not fit within the classified service.                                                                             
                                                                                                                                
Co-Chair Stoltze opened public  testimony. There being none,                                                                    
public testimony was closed.                                                                                                    
                                                                                                                                
10:34:12 AM                                                                                                                   
                                                                                                                                
Co-Chair Stoltze commented on the three, zero fiscal notes.                                                                     
                                                                                                                                
Co-Chair Hawker stated  he would not be  supporting the bill                                                                    
at this  time, were  it not for  the consequences  on senior                                                                    
attorneys  at the  Department of  Law. He  felt it  would be                                                                    
more  detrimental  to  the  state   to  not  continue  their                                                                    
employment, than to pass the bill at this time.                                                                                 
                                                                                                                                
Co-Chair  Stoltze   expressed  remorse  that  he   had  been                                                                    
uncomunicative with the department as of late.                                                                                  
                                                                                                                                
Co-Chair  Hawker  MOVED to  report  CS  HB 157(FIN)  out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CS  HB 157(FIN)  was REPORTED  out of  Committee with  a "do                                                                    
pass"  recommendation and  with  attached new  indeterminate                                                                    
fiscal note  by the  Department of Revenue,  zero note  2 by                                                                    
the Department of Natural Resources,  and zero note 4 by the                                                                    
Department of Administration.