Legislature(1995 - 1996)
02/21/1995 01:35 PM House FIN
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* first hearing in first committee of referral
+ teleconferenced
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+ teleconferenced
= bill was previously heard/scheduled
HB 137 An Act making supplemental appropriations for operating expenses of state government for fiscal year 1995; and providing for an effective date. HB 137 was HELD in Committee for further consideration. HOUSE BILL 137 "An Act making supplemental appropriations for operating expenses of state government for fiscal year 1995; and providing for an effective date." DEPARTMENT OF HEALTH AND SOCIAL SERVICES MAURICE NINHAM, CHIEF OPERATING OFFICER, NORTON SOUND HEALTH CORPORATION, NOME, testified on Section #27. He pointed out that the Island of St. Lawrence has a combined population of 700 people. There are currently eight people actively ill and seventy people infected with tuberculosis (TB). He provided the Committee with a short epidemiology of the disease stressing that poor hygiene is a condition of the norm on the island and that it is a condition in which the disease grows. He added, the challenge to prevent the spread of tuberculosis statewide is to prevent the infected people from converting to an actively ill or contagious status. For those actively ill, there are public laws which require treatment. The challenge will be to properly educate the infected but not yet actively ill patients. The treatment for the actively ill and the infected is the same and consists of six months of drug therapy. PETER NAKAMURA MD, MPH, DIRECTOR, DIVISION OF PUBLIC HEALTH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, further explained the need for the supplemental request. Historically, TB has been a major problem in the State, although, in 1986 the disease was on the verge of elimination. Consequently, at that time there was a shift in the program emphasis. The State conformed to that shift because of budgetary changes. At that point, the Department's ability to address the issue 2 decreased significantly. He stressed that tuberucolsis is currently resurging because of decreased preventitive funding. Dr. Nakamura continued, to address the concern will require a tremendous amount of effort. It is critical that the patient stay on therapy for the prescribed amount of time, otherwise the patient will develop a resistance to the treatment. This resistence can be caused by continuous interruption of therapy. Discussion followed between Representative Martin and Dr. Nakamura regarding the responsibility of Native Health Service and Public Health Service in relationship to the village epidemic. Dr. Nakamura reminded Representative Martin that resources had been shifted to other concerns with the statewide decline of TB. KATHI BURNS, CLINICAL DIRECTOR, NORTON SOUND HEALTH CORPORATION, NOME, commented on the current inflexibility of the regulations. She emphasized the immediate need to hire extra clinical people to help in the TB crisis. She pointed out that it would be easier to recruit to the Nome area, if the State would recognize additional professionals. There have been long-time vacant positions because of the high cost of living in Nome, resulting in recruitment difficulty. She urged the Committee to consider the expansion of licensed professionals. DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT BOB DINDINGER, ALASKA TOURISM MARKETING COUNCIL, JUNEAU, testified in support of Section #31 of the supplemental request in the amount of $2.5 million dollars for national advertising. Co-Chair Foster questioned the large increase to brochure advertising. Mr. Dindinger replied that because of reduced State match funds, the Council was forced to increase the costs for brochure business advertising. Co-Chair Hanley stated the request was not an emergency need and that he would not support the concern. He added, the impact would not dramatically affect this year's tourism market. DEPARTMENT OF EDUCATION DUANE GUILEY, DIRECTOR, SCHOOL FINANCE, DEPARTMENT OF EDUCATION, spoke to Section #18 of the supplemental request in the amount of $2 million dollars to cover the school districts estimated shortfall. He noted that there has been 3 an increase of 3300 students over the last year and that the Department is projecting an additional 2300 student increase in the next year. Representative Martin asked the portion of the request used for upgrading the individual student share. Mr. Guiley stated that the supplemental request represents a total increase to the instructional units including a combination of any changes in classification and normal student growth. KAREN REHFELD, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF EDUCATION, testified in support of Section #19 of the supplemental request in the amount of $615.7 thousand dollars which would address the vocational education costs to the federal grants still under negotiation. Co-Chair Hanley asked what portion of the request was for a current judgement against the State. Ms. Rehfeld advised that FY90 and FY91 were under appeal. The specific cost of FY90 would be $300 thousand dollars. If that case is ruled against, the court would also include the FY91 case equalling the additional portion of the request. JOE MCCORMICK, EXECUTIVE DIRECTOR, POSTSECONDARY EDUCATION COMMISSION, DEPARTMENT OF EDUCATION, spoke to Section #20 of the supplemental request in the amount of $22 thousand dollars which would fulfill a legally binding contractual agreement between the State of Alaska and the University of Washington for those participating students in the WAMI program. The request resulted from a shortfall which occurred last year when the FY95 appropriation did not equal the amount billed to the State for the program. (Tape Change, HFC 95-25, Side 2). Mr. McCormick stated that the State of Alaska has funded ten new students per year. The total cost per student each year is $47 thousand dollars. He added that the University of Washington raised fees without notice in order to cover inflation costs associated with that program. Mr. McCormick recommended that the State of Alaska consider the inflation cost increase each year to the program. NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, pointed out that when Governor Hickel submitted the budget for FY95, it was understood that budget was $55 thousand dollars shortfunded and it would be the intent that the money be collected by the University of Washington directly from the participants in the program. The University of Washington did not want to comply with that procedure, which caused the State to be short the amount for the contractual obligation. 4 Mr. Guiley spoke to Section #21, of the the supplemental request in the amount of $2.2 million dollars funding the Department of Education in the Toksook Bay fuel spill settlement. The litigation resulted from a 1990 oil spill leakage at the school. The request would fund: 1. $397 thousand dollar clean-up, based upon a plan approved by the Department of Environmental Conservation and which legally must be accomplished this summer; and 2. $1.8 million dollars negotiated settlement with the plaintiffs in the case, which consists of 500 residents in Toksook Bay area. The award received tentative approval by a judge contingent on funding through the Legislature. If it is not funded this session, the case will then proceed to a jury trial. Mr. Guiley explained that the oil spill contaminated ground water and was then drawn into a well system, thus, contaminating the water supply of the areawide homes, consequently, causing medical problems for the community. Representative Martin asked if the State had insurance to cover the costs. Mr. Guiley replied, under the use permit issued to each of the REAA school districts, each district is required to carry general liability insurance. Although, since 1986 the insurance policies have excluded pollution liability, which is currently unavailable at a reasonable cost. Representative Brown commented on the feasibility of using money from the Oil and Hazardous Substance Relief Response Fund. Mr. Guiley responded that the initial request suggested that the $396 thousand dollars come from that fund. The current plan would be for the Department to negotiate with the contractor to perform the clean-up as approved by DEC. Representative Brown recommended modifying the request by deleting the $396 thousand dollar portion. Mr. Guiley agreed. DEPARTMENT OF HEALTH AND SOCIAL SERVICES JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, testified in support of Section #22 of the supplemental request in the amount of $871 thousand dollars for a Medicaid pharmaceutical drug rebate which would offset an error of expenditure increases. That mistake was made in FY95. 5 Ms. Clarke spoke to Section #23 in the supplemental request in the amount of $4 million dollars to increased federal authority for the Indian Health Services Medicaid Program. The program would be 100% federally funded. She added, there has been an increase in the regional health corporations interests in clients eligibility for that program. Ms. Clarke noted that Section #24 of the supplemental request in the amount of $483 thousand dollars represents a policy shift from the current Governor to restore seven of the ten optional services deleted in FY95 budget. The seven services to be restored would be chiropractic, advanced nurse practioner, adult dental, emergency hospital, speech, hearing and language, optometrist services and eye glasses and occupational therapy. Representative Brown urged the Committee to reconsider the services. Ms. Clarke offered to provide the Committee with the break down of service allocations. Co-Chair Hanley suggested a reprioritization of the list. Ms. Clarke stated that Section #25 in the supplemental request in the amount of $392.9 thousand dollars for Family and Youth Services would fill vacant positions. She pointed out that $310 thousand dollars of the request would be a one time carry over of federal funds. The additional $83 thousand dollars would consist of a combination of a general fund match and general funds. There has been a 22% increase in reports requiring child protective services since FY92. Additionally, there has been a 17% increase in youth correction investigations. The Department's ability to fully fund all social workers and juvenile probation officer positions has been limited. Currently, there are seven less positions for social workers than there were in FY93. Ms. Clarke continued, Section #26 of the supplemental request in the amount of $580 thousand dollars for the Division of Family and Youth Services in order to maintain staffing levels at McLaughlin Youth Center for increased admissions. She advised that last year there was a supplemental request for McLaughlin resulting from unprecedented growth in the youth facility units. The Department had hoped that with the Juvenile Waiver bill that population would decrease. The first two quarters of FY95 observed a 16.5% increase to admissions at that facility. Ms. Clarke noted that the facility's maximum capacity is 150 6 inmates although during the fall 1994, the capacity exceeded 180 juvenile inmates. She suggested that the State could suffer a court intervention in the juvenile facilities if they are not fully staffed and funded. Ms. Clarke continued, Section #28 of the supplemental request for the Alaska Psychiatric Hospital (APH) fund source was changed due to the loss of third party receipts. Part of the decline was caused by the downsizing of API and budgetary cut reductions to the eighty bed facility. Co-Chair Hanley noted that a thirty percent decrease in beds would not equate to the proposed reduction. He advised that there is currently a management audit in place to address this issue. Ms. Clarke noted that the Department is also providing a staffing study. She pointed out that the downsizing plan was adopted 10/01/94 before the change of Administrations. Representative Martin asked if Elmendorf Air Force Base Hospital would be able to take current API patients. Ms. Clarke replied that Elmendorf has an eight bed psyche unit and that the native hospital has no beds for that category of patient. Ms. Clarke continued addressing the second portion of Section #28, a fund source shift in the amount of $164 thousand in general funds, a reduction in interagency receipts for Harborview for a net reduction for $331 thousand dollars. The funding source shift resulted from two events including the unexpected plans for an additional release of six residents from Harborview. Each time a resident is discharged, the State loses federal Medicaid funds. Because of the fixed costs at Harborview, the Department can not cut costs as quickly as the downsizing occurs. Co-Chair Hanley explained that consideration has been given to phasing Harborview out of usuage for psychiatric care. He encouraged the Administration to consider the options available for that facility. Ms. Clarke testified in support of Section #29 in the amount of $410 which would cover the judgements and claims for the Greenfield versus State case which has resulted in a superior court judgement. DEPARTMENT OF LABOR ARBE WILLIAMS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF LABOR, testified in support of Section #30 of the supplemental request in the amount of 7 $55.6 thousand dollars which would provide funding for the statewide information and analysis program for economic development. The program was deleted last year from the FY95 operating budget. The Department of Labor states that the program would be necessary in order to prepare for the 2000 statewide population census. Representative Brown questioned the need to buy a computer, monitor and software for that program noting that it had existed previously. Ms. Williams replied that those services were sold because of serious cuts to the operational budget. (Tape Change, HFC 95-26, Side 1). DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT Representative Brown referenced Section #31 - Alaska Tourism Marketing Council request and asked the Administration's position of implementing a tax to further fund that program. Ms. Slagle remarked that the Administration would support using contributions to sustain the program. Representative Brown urged the Committee to look for an additional funding source to cover the amount from general funds. DEPARTMENT OF MILITARY AND VETERAN AFFAIRS JEFF MORRISON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF MILITARY AND VETERAN AFFAIRS, spoke to Section #32 of the supplemental request in the amount of $900 thousand dollars for the estimated annual spring disaster costs which were averaged on a five year basis. The purpose of the Disaster Relief Fund would be to have funds available in order to be able to respond to disasters when needed. DEPARTMENT OF NATURAL RESOURCES BILL ANDREWS, FINANCE OFFICER, DEPARTMENT OF NATURAL RESOURCES, spoke to Section #33 of the supplemental request in the amount of $1.6 million dollars to cover the June, 1994 fire fighting expenditures. Those expenditures have been paid; authority was granted through the Emergency Declaration process in the Office of Management and Budget. He continued, Section #34 of the supplemental request in the amount of $7.2 million dollars when would provide an adequate funding level for FY95 fire suppression costs averaged on a seven year basis. Funding this component 8 would eliminate the need to go through the Emergency Declaration process for future fire suppression fixed costs. DEPARTMENT OF FISH AND GAME/DEPARTMENT OF ENVIRONMENTAL CONSERVATION/DEPARTMENT OF NATURAL RESOURCES TRACI CRAMMER, EXXON VALDEZ TRUSTEE COUNCIL, DEPARTMENT OF FISH AND GAME, explained that Section #35 would provide a language change which would request an authorization provided in the revised programs approved by the Legislative Budget and Audit program and extending to FY96. That language would be consistent with language approved last year. The Trustee Council operates on a federal fiscal year basis. Ms. Crammer offered to provide those RPL's to the Committee. The total authorization would be $16.5 million dollars. DEPARTMENT OF PUBLIC SAFETY DEL SMITH, DEPUTY COMMISSIONER, DEPARTMENT OF PUBLIC SAFETY, spoke to Section #36 of the supplemental in the amount of $682 thousand dollars for community jails resulting from increased cost in renegotiation of contracts in order to conform with operating standards of December 1994 Governor's Task Force on the Community Jails Programs report. KEN BISCHOFF, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF PUBLIC SAFETY, noted that contract jails are the responsibility of the State. Implementing that program has been difficult. Contract jails will not provide additional services, although the task force established standards for costs and guidelines of appropriate staffing. The expectation is to implement the suggestions recommended by the task force report. Representative Parnell voiced concern in using the supplemental to address inflation. Mr. Smith explained that the intention of the request would be to implement recommendations of the task force. Mr. Bischoff stated that the original contract had been extended until November, 1994. With the funds exhausted, local facilities will not house those prisoners. In most contracts there exists a "subject to appropriation" amendment. Not all contractors are willing to wait for the appropriation of the Legislature. Mr. Bischoff reiterated that the facilities need to exist to satisfy the State's responsibility. Each facility has fixed costs and variable costs. If the supplemental request is not approved, troopers would be removed from their job specific tasks in order to move prisoners to State 9 facilities. Discussion followed among Committee members and Mr. Smith regarding prisoner "holdings". Representative Brown asked how the contract jails in Anchorage differed from other municipalities. Mr. Smith explained that the Anchorage facility is operated by the State and leased from the municipality, but was originally owned by the municipality. The municipality pays for the man-days for municipally charged prisoners in that facility. Mr. Smith addressed Section #37 of the supplemental request in the amount of $200 thousand dollars for a state trooper termination settlement. Representative Brown commented on the number of termination problems which result in large payments from the State. She thought the information for these cases should not be kept confidential in order that the State rectify a change of procedures. Mr. Bischoff explained Section #38 of the supplemental request in the amount of $156 thousand dollars which would cover the operating costs of the Civil Air Patrol. Representative Brown pointed out that the request resulted from cuts to that budget in the FY95 operating budget. (Tape Change, HFC 95-26, Side 2). Mr. Smith continued, Section #39 in the supplemental request would address the loss of receipts due to low sale of permits for concealed weapons. Those sales have been substantially less than anticipated and consequently all the positions assigned to support that licensing unit have been reduced. Representative Parnell noted that twelve positions had been allocated, whereas, six were filled. Mr. Smith commented on Section #40 of the supplemental request for the Narcotics Task Force, used for uncollectible receipts from seized assets. Representative Kohring voiced his frustration regarding the supplemental process. He observed the number of requests which were not emergency. He said this was in contradiction to the definition of the Executive Budget Act description. HB 137 was HELD in Committee for further consideration.
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