Legislature(1999 - 2000)
03/16/1999 08:05 AM House CRA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 98-PUB.ASSISTANCE:PROGRAMS/GRANTS/CONTRACTS Number 2278 CO-CHAIRMAN HARRIS announced the next order of business before the committee as HOUSE BILL NO. 98, "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 tribal family assistance programs; and providing for an effective date." JIM NORDLUND, Director, Division of Public Assistance, Department of Health & Social Services, said that he was present to testify on behalf of the governor's bill, HB 98. This bill would allow Alaska Native organizations to run their own welfare programs in their own areas as well as providing an additional measure of local control over welfare programs. Mr. Nordlund explained that HB 98 developed from the Federal Welfare Reform Law signed by President Clinton in August of 1996. The federal law allows tribal and Native organizations in Alaska the ability to run their own Temporary Assistance for Needy Families (TANF) program. The TANF federal block grant runs the Alaska Temporary Assistance Program (ATAP) which is the replacement for the Aid to Families with Dependent Children (AFDC). Currently, Alaska receives about $65 million for the TANF block grant. The federal law specifies that block grant must be matched by, "the maintenance of effort", by 80 percent of the funding the state spent on the AFDC program in 1994. MR. NORDLUND explained that HB 98 would allow state funding to be utilized by a Native-run program in Alaska. The federal law says that the 12 regional nonprofits organizations in Alaska and the Metlakatla Indian Community are eligible to receive part of Alaska's block grant directly from the federal government to run their own programs. The amount of money would be determined by the department and would be based on the number of recipients that state money used to serve those clients in the fiscal year (FY) 1994. Mr. Nordlund stated that the reason for HB 98 is to allow a state match to the federal block grant. The AFDC program, the primary cash assistance program for poor families in Alaska, has traditionally been a 50-50 match program. The passage of the new federal law created the TANF block grant which required states to provide a match, but the match was not required for Native-run programs. Therefore, HB 98 would allow state funding to follow the federal money for a Native-run program. Native-run organizations would become eligible for this funding in much the same way as the state is eligible for the federal money. He explained that a plan must be provided to the U.S. Secretary of Health and Human Services; with the approval of that plan the Native-run organization would receive its federal share. Mr. Nordlund pointed out that the federal law includes a provision which states that a Native-run program in Alaska needs to be comparable to the state's program. Number 2508 MR. NORDLUND informed the committee that currently, Alaska has a grant that goes to the Tanana Chief's Conference (TCC). The grant received by the TCC is similar to HB 98 in that it provides state funding for cash assistance programs. In order to receive that state funding, the TCC had to amend its original program to become essentially identical to the state program. If HB 98 passed, the TCC would be able to amend its plan to a program that TCC would feel is a better welfare program for their area. For example, TCC wanted to implement a 5 percent benefit reduction and use those proceeds to fund enhanced alcohol and drug treatment programs for those screened to have such problems. Mr. Nordlund felt that HB 98 does provide an additional measure for local control, allow programs to be more culturally attune and better meet the needs of persons in the specific locals. MR. NORDLUND said that HB 98 would allow a Native-run program to serve a non-Native in that area with departmental approval. For example, in a small village populated with 20 Native families and one non-Native family it makes more sense for the Native-run program to serve the one non-Native family as opposed to the state serving that family. With regard to whether HB 98 will cost any money, Mr. Nordlund said no. Currently, the state serves Native families in these areas. This bill would allow the diversion of state funds to the Native organization in order to serve those same families. Therefore, there is not a fiscal note for HB 98. He noted that HB 98 has the possibility, although probably not in the short-term, to save the state money. Mr. Nordlund believed that a locally-run welfare program is probably a better welfare program and has a better possibility of helping reduce welfare case loads, thereby saving money. Number 2667 CO-CHAIRMAN HALCRO asked if the intent of HB 98 is to provide more flexibility. MR. NORDLUND replied yes. CO-CHAIRMAN HALCRO noted that Mr. Nordlund had provided a list of 14 organizations. He asked if those organizations have already been approved to participate in this program or have those organizations merely expressed a desire to participate. MR. NORDLUND clarified that there are 12 regional nonprofits and the Metlakatla Indian Community. No organization has been approved yet. He reiterated that approval is incumbent upon a plan that the organization submits to the federal government. The TCC plan has been approved but had to be amended to become ATAP compatible in order to receive state funding. In further response to Co-Chairman Halcro, Mr. Nordlund agreed that in those areas without an organization expressing interest in administering a welfare program, the state would serve that population. Mr. Nordlund noted that not all of the authorized organizations will pursue this. Number 2753 REPRESENTATIVE MURKOWSKI noted that Mr. Nordlund used permissive language when saying that a non-Native "may" participate in one of these programs. Representative Murkowski referred to Mr. Nordlund's example regarding a Native community with one non-Native family. She asked if it would be an option to exclude the non-Native family or would a Native nonprofit program have to include anyone eligible in that village regardless. MR. NORDLUND explained that if the Native organization and the state agreed that the non-Native family would be served in that village by the Native organization, that would be the case. The recipient would not have the option to decide between service from the state or the Native organization. REPRESENTATIVE MURKOWSKI asked if for example, the Kodiak Native Association could operate its program at the same time the state operates its program. MR. NORDLUND agreed that would be possible. He would encourage a plan under which the state would serve non-Natives in Kodiak, while the rural villages on Kodiak Island would be served by the Native-run program. This would all be dependent upon the service delivery structure that would be created in association with the Native organization. However, Mr. Nordlund pointed out that it would also be possible that the determination would be that the Native organization would serve the non-Natives in that area. Mr. Nordlund stated it is too soon to make such projections. Number 2875 REPRESENTATIVE MURKOWSKI expressed concern that if two different entities operate similar programs, there would be some administrative overlap. Is there a way to eliminate such overlap? MR. NORDLUND clarified that to eliminate the administrative overlap and make use of the administration better is the intent of HB 98. In larger communities such as Fairbanks, large administrative structures exist. In smaller communities, having an additional administrative body tends to be less efficient. REPRESENTATIVE KOOKESH commented that these Native organizations to which Mr. Nordlund is speaking have been alive for many years and have strong administrative staff and presence in their regions. These Native organizations would survive even without this legislation, but HB 98 could make life in Rural Alaska easier. This legislation makes sense for these regions as well as for the state as a whole. Representative Kookesh said if the Native organization does not do this work, the state will need a larger presence in these areas. TAPE 99-15, SIDE B Number 2991 MR. NORDLUND pointed out that there is a limit to the state's presence, especially in the smaller areas of Alaska. Native organizations have already established a presence in villages. Furthermore, Native organizations have a better ability than the state to work with rural clients to do a better job helping those clients move away from public assistance. In response to Representative Murkowski, Mr. Nordlund stated that the TCC program is very young. The TCC officially took over the program in October. After a three month transition period, the TCC began paying benefits. Mr. Nordlund believed it is still very early to comment on the success of the program. Many hurtles remain to be overcome. Mr. Nordlund believed that in the long run the TCC program will be more successful than the state's program in that area. REPRESENTATIVE DYSON noted that he was most familiar with Bristol Bay Native Cooperation and the Cook Inlet Tribal Council. Those organizations have done excellent work and are an immense asset. REPRESENTATIVE MORGAN asked if the TCC program has made judgement calls based on the color of someone's skin in order to determine for which program that individual would be eligible. MR. NORDLUND informed the committee that protocols are being established to determine such referrals. Mr. Nordlund pointed out that the Division of Public Assistance will continue to issue benefits and make eligibility determinations for the Medicaid program and food stamps for Adult Public Assistance for Natives and non-Natives. Only for ATAP would Native clients be referred to TCC. Number 2800 REPRESENTATIVE MORGAN asked if the state would respect TCC's application or would a client have to go through the entire process again for the state. He indicated the possibility of duplication and inconvenience for the client. MR. NORDLUND said that there may be some inconvenience for the client. He expressed the importance of establishing a relationship between the client and TCC employee who will work with that client in the future. Mr. Nordlund acknowledged that in some cases the client would have to go across town to receive a service. REPRESENTATIVE JOULE noted that there is access to the Alaska Career Information System (ACIS) during the transition from welfare to work. Would that technology be available to the Native organizations? Representative Joule emphasized that ACIS is an excellent resource. MR. NORDLUND said that clients are entitled to those services at the usual locations (one-stops, the job service). Ideally, Native organizations running these programs would offer such in house through a computerized connection. However if the Native organization has not reached that development stage, a client could receive that information from an access point. REPRESENTATIVE JOULE asked if a Native organization were on-line would ACIS follow. MR. NORDLUND clarified that would be dependent upon the capabilities of the Native organization. However if the service is not available through the Native organization, the service would be available through the other state offices. Number 2609 REPRESENTATIVE DYSON encouraged, as Representative Morgan spoke to earlier, co-locating these services and having one intake form. Representative Dyson indicated he would ultimately desire every family or person have one person/counselor/case manager who would access all available services whether federal, state, local or tribal. Representative Dyson understood from prior comments that this legislation would somewhat separate services, but the benefits would outweigh that concern. MR. NORDLUND pointed out that the department is endeavoring to establish a case management system. He mentioned the opening of the one-stop center in Muldoon. Mr. Nordlund encouraged Native organizations to try to locate in existing one-stops which would not only save time for the client, but also achieve efficiencies in other functions. Mr. Nordlund said that the department is trying to move in that direction, but it is fairly complicated. REPRESENTATIVE DYSON mentioned that he had watched the Department of Community & Regional Affairs do creative things in order to find local organizations through which to work. Could the statute be changed to make this easier? Representative Dyson longed for the day in which a single individual can act on behalf of the local, state and federal governments, et cetera. Therefore, co-locating and separate administrative requirements would not be necessary. REPRESENTATIVE MORGAN commented that HB 98 sounds like the beginnings of the privatization of state services which he indicated perhaps, he would like. MR. NORDLUND agreed this could be viewed as privatization. Mr. Nordlund stated, "There is a bit of concern here in that regard, in that--there is a provision in our state contract with the Public Employee Unions that any time we look to privatize unless we can show that its saving money, that a feasibility study needs to be done in order to show that money actually can be saved to this effort." Mr. Nordlund believed that would have to be done before this legislation could be fully utilized. Number 2273 REPRESENTATIVE MURKOWSKI returned to the Kodiak scenario. She noted the understanding that a Native nonprofit organization has the latitude to modify the program to accommodate local needs. Suppose there is a Native organization running the program and the state is running assistance for those located in Kodiak. "Is it possible that one program is going to be perceived as more favorable than the other and the only basis for the distinction is the fact that one family is Native and one family is non-Native? And what kind of problems does that create?" MR. NORDLUND acknowledged Representative Murkowski's comments as one of the concerns with HB 98. He pointed out that Senator Murkowski had encouraged comparability language in federal law that is included in the law as well as standards for comparability. The programs must be comparable enough that the recipient of either program is not discriminated against. For example, if HB 98 passes and TCC does the five percent benefit cut in order to provide other services, Mr. Nordlund recognized the possibility of a challenge from a TCC recipient claiming they were treated unfairly which could lead to litigation. Mr. Nordlund hoped the comparability criteria would be adequate to sustain such a challenge. CO-CHAIRMAN HARRIS inquired as to the way the money changed hands. MR. NORDLUND explained that currently, the state pays cash to ATAP through a debit card. He did not believe most Native organizations would have that capability. Mr. Nordlund believed that TCC paid its clients through their general account. He suggested there might be folks from TCC on-line who could better speak to this. In further response to Co-Chairman Harris' question about a tracking mechanism, Mr. Nordlund said that there is some reporting about which recipients are receiving benefits and the level of benefits received. Presumably, those recipients are eligible to receive those benefits. He noted that there is an appeal process for clients who feel that they have not received the proper benefit. An unhappy client would first appeal to TCC, then to the department, and to the court system. MR. NORDLUND mentioned that the federal government has criteria for the block grant as well. The federal government has auditing procedures and performance measures for the Native organization. Furthermore, the department has normal auditing procedures to which the Native organization would be subject. Number 1921 TERRY HOEFFERLE, Chief of Operations, Bristol Bay Native Association (BBNA), testified via teleconference from Anchorage. He was impressed with the knowledgeable level of discussion. The federal TANF legislation identified 13 organizations in Alaska as eligible to operate local programs of which 12 are regional Native nonprofits and the Metlakatla Indian Community. Some regional organizations have already indicated that they are not interested in operating their own family assistance program. He noted that some of the regional organizations are too small to operate such a program. MR. HOEFFERLE informed the committee that BBNA was established in 1966 and most of the other organizations are over 30 years old. These organizations were created to resolve Native land claims in Alaska. Although the regional boundaries of the regional Native nonprofits correspond to the regional for profit Native corporations, the two should not be confused. These 12 regional Native nonprofits operate Indian programs which include health and social service programs. These tribal programs bring in over $400 million per year to the state. Mr. Hoefferle described these tribal programs as Indian funded dollars which could be viewed as authorized by the U.S. Congress as treaty obligations. Mr. Hoefferle informed the committee that these organizations contract with various federal agencies each of which has its own programming and reporting requirements that must be followed. He noted that the Native nonprofits also operate state contracts and grants for a diverse group of programs such as Village Public Safety and Healthy Families to name a few. MR. HOEFFERLE informed the committee that BBNA provides services in 32 villages in the Bristol Bay region. The BBNA Board of Directors has a member from each village as well as six members at large. This year BBNA has a $16 million budget and 302 employees, of which 68 are located in the central office in Dillingham and the remaining 234 employees are located in the villages in the region. Within the villages, the BBNA employees are employed in various capacities from the Village Public Safety Officer to Tribal Children Service Workers. Number 1526 MR. HOEFFERLE identified the major focus of BBNA, as well as other Native nonprofits in Alaska, as placing Native people in the workforce. Today BBNA has a workforce development budget of $1.2 million which is used for employment training, higher education scholarships, child care, and general assistance. Although these are Indian Program funds, these funds can be used to leverage some of the ATAP funds. The aforementioned programs are worked out of a one-stop shop workforce development center in Dillingham. BBNA created this one-stop shop using its own administrative dollars. The State of Alaska is co-locating some of its similar programs into the office structure. Mr. Hoefferle pointed out that BBNA has an agreement with the Alaska Department of Labor to operate a computer which has access to the department's information system. Also the Department of Community & Regional Affairs has co-located its peer outreach workforce program in the BBNA offices. MR. HOEFFERLE agreed with Representative Kookesh's comments that his interest in HB 98 is not to guarantee the Native nonprofits survival. The manner in which BBNA operates the aforementioned programs requires an administrative rate, an indirect cost rate, which is much lower than that of the University of Alaska, the State of Alaska, or the U.S. government. Mr. Hoefferle explained that assessment was determined from the indirect rate the state and federal governments have applied to disaster assistance funds coming in to Bristol Bay. The interest in administering this program emanates from the BBNA's local presence and resources in the region. Mr. Hoefferle stated that BBNA can do a better job moving "our" people from welfare to work than the state. The state program is operated via a long-distance phone call to Anchorage. Number 1212 DON SHIRCEL, Director, Family Services, Tanana Chiefs Council, testified via teleconference from Fairbanks. He informed the committee that since October 1, 1998 the TCC has operated the TANF program, which is called the Athabascan Self-Sufficiency Assistance Partnership (ASAP), for Native households. The TCC service area encompasses over a third of the entire state. During the first three months of programming, TCC has transitioned over 500 Native household cases which is about one-third of the Division of Public Assistance's Northern region case load. Since mid December, TCC has been the sole agency determining eligibility, processing applications, and providing timely benefits to over 450 Native households in over 40 rural communities and in Fairbanks, Alaska's second largest city. Mr. Shircel discussed the intricacies of initiating and setting up structures for this program. MR. SHIRCEL stated that it is still too early to make projections to the full impact of the privatization of welfare services under the TCC ASAP program. In six months of operation, the TCC has not had any formal complaints and have been able to engage over 35 percent of the rural caseload in work activities and created one-stop service centers in 38 remote rural communities. The state has not been able to do either on the same dime, since the initiation of welfare reform programming. Mr. Shircel emphasized that tribes are, through their Native organizations, operating these programs effectively, efficiently, within the constraints of the organization's budget and with the full support and participation of over 40 communities. Mr. Shircel echoed Mr. Nordlund's comments that the TCC would like to do more which would be allowed under HB 98. He reiterated the TCC's desire to implement a five percent reduction in benefits, mandatory alcohol and substance abuse screening, a voucher system for clients suspected of misuse of welfare benefits, stronger sanctions for nonparticipation in work activities, stronger sanctions in domestic violence cases, and incentives for parents to participate in parent-teacher conferences and children's health screenings. Mr. Shircel said that he would appreciate the committee's serious consideration of moving HB 98 out of committee and the legislator's support this session. There being no one else wishing to testify, the public testimony was closed. Number 0867 CO-CHAIRMAN HALCRO moved CSHB 98 out of committee with individual recommendations and the attached zero fiscal note. There being no objection, CSHB 98(CRA) was reported out of committee.
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