Legislature(2009 - 2010)HOUSE FINANCE 519
04/11/2010 12:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB296 | |
| HB416 | |
| HB421 | |
| SB199 | |
| HB424 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 296 | TELECONFERENCED | |
| + | HB 416 | TELECONFERENCED | |
| *+ | HB 421 | TELECONFERENCED | |
| += | HB 424 | TELECONFERENCED | |
| + | SB 199 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE BILL NO. 421
"An Act relating to the compensation of certain public
officials, officers, and employees not covered by
collective bargaining agreements; and providing for an
effective date."
2:05:16 PM
KEVIN BROOKS, DEPUTY COMMISSIONER, DEPARTMENT OF
ADMINISTRATION, reported that negotiations had concluded
resulting in voluntary agreements between the state and the
five unions that represent state employees. He noted that
HB 421 provided a similar wage increase for non-covered
employees in the executive, legislative, and judicial
branches.
He summarized the contents of the legislation by section.
Section 1, of the bill represents a two percent increase to
the FY 2010 salary schedule to begin in FY11. Sections 2
and 3, of the bill provide for similar increases in FY12
and 13. Section 4, addresses a similar wage increase for
employees of the executive branch. Section 5, provides for
a comparable two percent increase for employees of the
court system. He pointed out that the executive and
judicial branches do not use the legislature's wage range
classification. Section 6, clarified that the University of
Alaska employee's wage increases are determined by the
Board of Regents. Section 7, provides for an effective date
of July 1, 2010.
Co-Chair Stoltze announced that the wage increase does not
apply to elected officials. Mr. Brooks affirmed.
Representative Austerman asked for clarification of the
wage increase. Mr. Brooks restated that the wage increase
was two percent for FY 2011, FY 2012, and FY 2013.
2:08:43 PM
Co-Chair Hawker questioned the wage increase when the state
economy is struggling and with record-high unemployment
rates. Mr. Brooks replied that the department was aware of
the economic climate and the issues were prevalent in
discussions with the labor unions. The contracts reached
with unions were relatively modest compared with contracts
in past years. He argued for parity for similarly situated
state employees not covered by unions.
Co-Chair Hawker appreciated acknowledgement of the dilemma.
He believed the court system employee's compensation was
relatively low. He wondered if it was possible to approve
the fiscal note for the court system but not for the
executive and legislative branches.
2:12:03 PM
Mr. Brooks expressed uncertainty regarding the procedure to
make the change.
Co-Chair Hawker wondered what would happen if the committee
passed out the bill but zeroed out the fiscal notes for the
executive and legislative branches. Mr. Brooks thought that
the money would have to be taken from other sources of
funding in the executive and legislative budgets. The bill
would authorize the expenditure for all three branches of
government.
Representative Kelly asked what the rate of inflation was
estimated to be in the next three years. Mr. Brooks
reported that the department did not attempt to project the
consumer price index (CPI) in relation to the wage
increases.
Representative Fairclough cited page 37, Article 12 of the
Alaska Constitution that addresses the merit system. She
asked if the wage increases in HB 421 were based on the
merit system as described in the constitution. Mr. Brooks
believed that it was consistent with Article 12. However,
the wage increases were mostly associated with cost-of-
living adjustments.
Representative Fairclough opined that it was difficult to
award merit pay to outstanding employees through the
established system. Mr. Brooks thought that the state's pay
system was consistent with the merit principals set forth
in the constitution.
2:16:35 PM
Representative Fairclough hypothesized the situation of a
zero-based budget without increases and asked if an
administrator had the flexibility to change an employee's
pay within the existing structure by changing steps or
ranges. Mr. Brooks stressed that it was important to
distinguish between statutory employees and those covered
under collective bargaining agreements [unionized]. He
affirmed that the rate of pay can be changed
administratively through individual job reclassifications.
Representative Gara relayed that the average rate of
inflation over the last three years was 2.7 percent. He
believed that a "meager" two percent wage increase fails to
keep up with the cost of living. He was supportive of the
increase and wished it was higher.
Representative Austerman asked when the last salary
increase was. Mr. Brooks answered that the previous three
fiscal years had increases of five and one half percent the
first year and three percent the following two years.
Representative Austerman asked if the inflation rate was
2.7 percent over the last three years. Mr. Brooks affirmed.
2:20:27 PM
Co-Chair Hawker pointed to Section 6 of the bill and
inquired about the absence of a fiscal note for the
University of Alaska. Mr. Brooks answered that the
University of Alaska was not included in HB 421. Co-Chair
Hawker wondered why the Section exists. Mr. Brooks supposed
it was a clarifying section. He implied that it could be
removed.
Co-Chair Hawker wondered if the rules that determine how
the legislative branch sets the range increments are
referenced in the legislation. Mr. Brooks related that the
legislative staff pay rules are covered under the reference
to Title 24 on page 1, line 9 of the bill.
HB 421 was HEARD and HELD in Committee for further
consideration.