Legislature(1995 - 1996)
02/16/1996 01:38 PM House FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
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HOUSE BILL NO. 468
"An Act making supplemental appropriations for the
expenses of state government and making and amending
appropriations; ratifying certain state expenditures;
and providing for an effective date."
Co-Chair Hanley provided members with Work Draft for HB 468,
Parnell MOVED to adopt Work Draft for HB 468, #9-GH2058\C,
dated 1/16/96. There being NO OBJECTION, it was so ordered.
Co-Chair Hanley provided members with a spread sheet of the
Committee Substitute for HB 468 (FIN) (Attachment 1). He
compared CSHB 468 (FIN) to HB 468.
DEPARTMENT OF ADMINISTRATION
Section 1(a) addresses the reduced centralized
administrative, Division of Finance services shift to
the Bethel Public Defender Office to meet increased
caseloads in the amount of $49.0 thousand dollars.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 1(b) supplemental budget request in the amount
of $217.0 thousand dollars to cover the operating cost
shortage for the Public Defender agency (Rule 39
receipts for representation).
Co-Chair Hanley explained that this request was included but
that he recommended that it be reduced to $195.0 thousand
dollars.
Section 1(c) would provide for $356.4 thousand dollars
for operating costs for the Office of Public Advocacy
(OPA).
Co-Chair Hanley stated that this section was retained at an
amended amount of $335.1 thousand dollars in the Committee
Substitute for HB 468 adopted by the Committee.
Section 1(d) would provide $870.0 thousand dollars to
fully fund leasing expenses.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 1(e) supplemental budget request in the amount
of $450.0 thousand dollars would cover investment
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management fees resulting from a higher than expected
asset growth in Retirement and Benefits.
Co-Chair Hanley observed that this section was included in
the Committee Substitute for HB 468 adopted by the
Committee.
Section 1(f) supplemental budget request to ratify a
FY95 over expenditure of $23.1 thousand dollars for
longevity bonus grants.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 2 supplemental budget request of $61.2 thousand
dollars to cover FY96 and FY97 costs for office space
in Tokyo. Offices will be combined. The security
deposit plus interest for an existing lease will be
refunded and deposited into the general fund.
Co-Chair Hanley stated that Section 2 was removed from the
Committee Substitute for HB 468 adopted by the Committee.
DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS
Section 3(a) would provide revenue sharing costs for
the Native Village of Kluti Kaah in northern Alaska.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Sections 3(c,d & e) were requested for capitalization
of the Rural Development Initiative Loan Fund (RDILF).
AIDEA would provide $650 thousand dollars to capitalize
the Fund.
Co-Chair Hanley observed that Section 3(c, d & e) were not
included in the Committee Substitute for HB 468 adopted by
the Committee.
Sections 3(f&g) supplemental request for $200 thousand
dollars for the Alaska Legal Service grant in lieu of
pending legal fees. The request provides funding in
anticipation of a federal dollar shortage.
Co-Chair Hanley explained that Section 3(f&g) was not
retained in the Committee Substitute for HB 468 adopted by
the Committee.
DEPARTMENT OF CORRECTIONS
Section 4(a & b) supplemental request would cover the
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Cleary court fines for FY95 and FY96 contempt case.
Co-Chair Hanley explained that this section was included and
adjusted to $936.6 to reflect the amount needed to cover
court fines through the end of January 1996.
DEPARTMENT OF EDUCATION
Section 5(a) supplemental budget request identifies
excess funds in the foundation program and then
appropriates those funds as grants to school districts
in order to address the disparity problem.
Co-Chair Hanley stated that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 5(b) would extend the lapse date for the FY 96
K-12 appropriation.
Co-Chair Hanley observed that Section 5(b) was not included
in the Committee Substitute for HB 468 adopted by the
Committee. He explained that the extension of the lapse
will be part of the budget process.
DEPARTMENT OF ENVIRONMENTAL CONSERVATION
Section 6(a & b) would extend Spill Prevention
Response/Underground Storage Tank lapsed funds and
reappropriate encumbrances for the Storage Tank
Assistance Program through June 30, 1997.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
He explained that the lapsed funds in Section 6(b) are
extended for one year instead of two. The language in
Section 6(b) remains the same as the Governor's original
bill.
DEPARTMENT OF FISH AND GAME
Section 7 supplemental budget request for the Exxon
Valdez Oil Spill Trustee Council would extend the lapse
date for approved EVOSS projects to the end of FY97.
These lapse dates have been approved by the Legislative
Budget and Audit (LBA) Committee.
Co-Chair Hanley observed that Section 7 was not included in
the Committee Substitute for HB 468 adopted by the
Committee.
Section 8(a) supplemental budget request in the amount
of $32.7 thousand dollars would pay increased vendor
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compensation in increased sales of fish and game
licenses.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 8(b) supplemental budget request would provide
for a language change addressing the scope of the
Arctic-Yukon-Kuskokwin salmon fisheries stock
assessment for "equipment" to "projects", thus allowing
for public participation.
Co-Chair Hanley stated that Section 8(b) was not included in
the Committee Substitute for HB 468 adopted by the
Committee. He observed that this item will be considered
for inclusion in the reappropriation bill.
DEPARTMENT OF HEALTH AND SOCIAL SERVICES
Section 9(a/1) supplemental budget request which would
reduce Aid to Families with Dependent Children (AFDC)
in order to fund other welfare reform programs (Public
Assistance eligibility tracking system $3.5 thousand
dollars; child care benefits, Jobs Program for $1
thousand dollars).
Co-Chair Hanley explained that this section was retained in
the Committee Substitute for HB 468 adopted by the
Committee.
Section 9(a/2) for $500 thousand dollars would be an
investment to increased child care benefits and would
be shifted from AFDC.
Co-Chair Hanley noted that this section was included in the
Committee Substitute for HB 468 adopted by the Committee.
Section 9(b) supplemental budget request for $3.5
million dollars for the Eligibility Information System
(EIS) which would provide changes to the main frame
system to meet federal welfare reform requirements.
The funds would be shifted from AFDC.
Co-Chair Hanley explained that the $3.5 million dollar
request was reduced to $1.9 million dollars in general fund
authorization and $1.6 other funds. This is the amount of
federal funds that the Division anticipates capturing by
October 1, 1996.
Section 9(c)(1&2) supplemental budget request transfer
of $250 thousand dollars, from Family and Youth
Services to fund Youth Facilities. These funds would
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be used for the McLaughlin and Johnson Youth Centers.
Co-Chair Hanley stated that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 9(c)(3)(d) supplemental budget request for a
$3.5 million dollar reduction in the Medicaid program
to fund the welfare reform proposal for the Alaska
Family Independence (AFI) program.
Co-Chair Hanley noted that this section was not retained in
the Committee Substitute for HB 468 adopted by the
Committee. He observed that this is a new program. He
stressed that fiscal notes should accompany the legislation.
Section 9(e) supplemental budget request in the amount
of $426.9 thousand dollars would be used to pay the
judgement in Helmuth v. State - API employee social
services settlement.
Co-Chair Hanley explained that this section was included in
the Committee Substitute for HB 468 adopted by the
Committee.
DEPARTMENT OF LAW
Section 10(a & b) supplemental budget request in the
amount of $369.3 thousand dollars to be used for
judgments and claims.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 10(c) judgement - Berger v. State.
Co-Chair Hanley observed that this section was not included
in the Committee Substitute for HB 468 adopted by the
Committee. He recommended that Section 10(c) be reinstated
to reflect the actual judgement amount.
Section 10(d/1 & 2) supplemental budget transfer in the
amount of $66.6 thousand dollars, reducing FY96, oil
and gas litigation in order to fund an additional
prosecutor in Bethel resulting from increased case
loads.
Co-Chair Hanley explained that this section was retained in
the Committee Substitute for HB 468 adopted by the
Committee. He explained that the Committee may remove the
section that reduces the amount out of Oil and Gas
Litigation. He observed that there is some question if this
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would take a three-quarter vote due to the Constitutional
Budget Reserve Fund as the funding source.
DEPARTMENT OF MILITARY AND VETERANS AFFAIRS
Section 11(a) supplemental budget request in the amount
of $1.4 million dollars for increased costs for the
National Guard Retirement Fund based on updated
actuarial reports. The current liability is funded at
only 17%.
Co-Chair Hanley noted that Section 11(a) was included in the
Committee Substitute for HB 468 adopted by the Committee.
Section 11(b) supplemental request in the amount of
$557.3 thousand dollars for payment relief from
disasters which have already been declared.
Co-Chair Hanley stated that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
DEPARTMENT OF NATURAL RESOURCES
Section 12 supplemental request in the amount of
$5,258.0 million dollars would be allocated for fire
suppression covering spring fire contracts and
anticipated fire activity through the end of the fiscal
year.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
DEPARTMENT OF PUBLIC SAFETY
Section 13 request to amend FY 95 capital appropriation
to include "equipment".
Co-Chair Hanley noted that this request was not included in
the Committee Substitute for HB 468 adopted by the
Committee.
DEPARTMENT OF REVENUE
Section 14(a) supplemental budget request in the amount
of $198.2 thousand dollars for unanticipated lease
costs for AHFC.
Co-Chair Hanley stated that this section was included in the
Committee Substitute for HB 468 adopted by the Committee.
Section 14(b) would transfer $67.0 thousand dollars
between fund sources in the Alaska State Pension
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Investment Board.
Co-Chair Hanley observed that this section was retained in
the Committee Substitute for HB 468 adopted by the
Committee.
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES
Section 15(a) supplemental budget request in the amount
of $4 million dollars would be used for highway and
bridge repair costs related to Southcentral flood
disasters.
Co-Chair Hanley noted that this section was included in the
Committee Substitute for HB 468 adopted by the Committee.
Section 15(b) supplemental budget request in the amount
of $720 thousand dollars for the Copper River Highway
restoration settlement.
Co-Chair Hanley stated that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
UNIVERSITY OF ALASKA
Section 16(a) supplemental budget request in the amount
of $455.0 thousand dollars for the 1995 monetary terms
agreement with the Classification Employee Association
(CEA).
Co-Chair Hanley noted that this section was not included in
the Committee Substitute for HB 468 adopted by the
Committee.
Section 16(b) request in the amount of $473.0 thousand
dollars would be used for the 1995 monetary terms
agreement with the Alaska Community College Federation
of Teachers (ACCFT).
Co-Chair Hanley stated that this section was not included in
the Committee Substitute for HB 468 adopted by the
Committee.
OFFICE OF THE GOVERNOR
Section 17, $1.5 million dollars to the Office of
Management and Budget for a small reserve to allow
immediate response to anticipated FY 96 & FY 97
disasters and fires.
Co-Chair Hanley noted that this section was not included in
the Committee Substitute for HB 468 adopted by the
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Committee.
ALL DEPARTMENTS
Sections 17(a), Miscellaneous Claims - general funds &
Section 17(b), Miscellaneous Claims - other funds.
Co-Chair Hanley stated that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
Section 18, Prior Year Ratification to straighten state
accounting records.
Co-Chair Hanley noted that this section was retained in the
Committee Substitute for HB 468 adopted by the Committee.
AMENDMENTS
DEPARTMENT OF LAW - Section 10(c)
Co-Chair Hanley provided members with a letter from Nancy
Slagle, Director, Division of Budget Review, dated 2/16/96
requesting reinstatement of Section 10(c) at the amended
amount of $3,605.8 million dollars. Representative Parnell
MOVED to adopt Amendment 1, reinstate Section 10(c) at the
amended amount of $3,605.8 million dollars. There being NO
OBJECTION, it was so ordered.
DEPARTMENT OF ADMINISTRATION - Section 1(b & c)
Co-Chair Hanley stated that the addition of a $217.0
thousand dollar request when added to the FY 96 authorized
amount results in a total FY 96 amount which is greater than
the FY 97 request. He observed that there are $20.0
thousand dollars in interagency receipts intended for FY 97.
SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF ADMINISTRATION explained that there
are $25.0 thousand dollars in interagency receipts in the FY
96 operating budget and an unbudgeted RSA with Department of
Health & Social Services for an additional $25.0 thousand
dollars in FY 96. The Department only expects to receive
$10.0 - $15.0 thousand dollars from this RSA. She stated
that there will be no additional funding available in FY 96.
In FY 97 they have requested $50.0 or $55.0 thousand
dollars. She stated that the Office of Public Advocacy will
need the full amount. She observed that there are
additional Rule 39 monies available through general fund
program receipts to make up the difference. She stated that
the Department projects that the Public Defender Agency will
need $195.0 thousand dollars to complete the fiscal year.
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She asked that the Office of Public Advocacy be fully
funded.
Representative Navarre MOVED to adopt Amendment 2 (copy on
file), Add Sections 1(b & c) with an amended number of
$195.0 thousand dollars for Public Defender Agency and
$356.4 thousand dollars for the Office of Public Advocacy.
There being NO OBJECTION, it was so ordered.
DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT - Section 2
Representative Navarre MOVED to adopt Amendment 3 (copy on
file) to reinstate Section 2, $61.2 thousand dollars to
cover FY96 and FY97 costs for office space in Tokyo. He
spoke on behalf of Amendment 3. He emphasized that $50.0
thousand dollars will be saved by combining the offices of
the Division of Trade and the Division of Tourism. He noted
that the deposit on the existing space will not be returned
for six months. The money will be returned in December. He
noted that there will be a $50.0 thousand dollar on going
savings.
GUY BELL, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF
COMMERCE AND ECONOMIC DEVELOPMENT explained that the
contract is being renegotiated. He stated that notice has
been given to the current landlords and a deposit has been
placed on the new office space.
Representative Navarre reiterated that the move will result
in a savings.
Representative Therriault questioned if a lack of funding
would be absorbed in the Department of Commerce and Economic
Development's budget. Mr. Bell noted that the Department
had to make a decision in order to assure the savings in the
next fiscal year. He observed that the FY 97 budget for the
Department is smaller than FY 96.
Representative Navarre suggested that the Legislative Budget
and Audit Committee keep track of the deposit to assure that
it is returned to the General Fund.
Representative Navarre restated his motion to adopt
Amendment 2. There being NO OBJECTION, it was so ordered.
DEPARTMENT OF FISH AND GAME - Section 7
Co-Chair Hanley explained that Section 7 would extend the
lapse dates on projects authorized by the Exxon Valdez Oil
Spill Trustee Council. He observed that these projects have
been approved by the Legislative Budget and Audit Committee
through the end of FY 96. He noted that the federal
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government is on a different fiscal year which begins
October 1 and ends September 30. He questioned if
authorization should be included in the operating budget
under other funds.
TRACY CRAMER, EXXON VALDEZ OIL SPILL TRUSTEE COUNCIL,
DEPARTMENT OF FISH AND GAME stated that the agencies that
are receiving funding from the Trustee Council will include
authorization to receive and expend funds in their FY 97
budget requests based upon their anticipation of the Trustee
Council's FY 97 work plan. The FY 97 work plan begins on
October 1, 1996 and ends September 30, 1997. It is set up
on the federal fiscal year because of the type of projects
involved. September is a better time for completion of
field work. She noted that agencies have been asked to give
serious consideration to projects that have been approved
for FY 96 and put in their best guest. She observed that
when the Trustee Council meets in August they will have an
approved work plan. She noted that a comparison will be
made between the work plan and the budget approved by the
Legislature.
Ms. Cramer expressed concern that if the funds are
appropriated in a hybrid situation it will be difficult to
make comparisons. She noted that one quarter of the FY 96
work plan would be included with three-quarters of the FY 97
work plan. She emphasized that they are not using federal
funds. The funds are expendable trust funds in the General
Fund. She observed that the Trustee Council is requiring
specific projects in the agencies. There are approximately
65 Trustee Council projects. She asked that the funds be
extended so that they can be expended in the same manner as
they are accounted for in the Trustee Council.
Co-Chair Hanley clarified that the extension of the lapsed
date is for projects that have been approved by the Trustee
Council and the Legislative Budget and Audit Committee. Ms.
Cramer noted that the original request would extend the
projects to June 30, 1997. She stated that the Trustee
Council would support an amendment to extend the lapse to
September 30, 1996.
Ms. Cramer explained that the Trustee Council is requesting
authority to receive and expend FY 96 projects based on what
agencies think will be approved in the FY 97 work plan.
Representative Martin stressed that the purpose is to let
the Legislature know how much money is coming from the Exxon
Valdez Oil Spill Settlement. The Department of Fish and
Game, the Department of Natural Resources and the Department
of Environmental Conservation receive the majority of EVOSS
funds. He asked if the Trustee Council can anticipate the
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amount of funds that will go to each department. Ms. Cramer
stated that they know the bulk of the work plan. She
emphasized the difficulty in accounting for the different
fiscal year.
MIKE GREANY, DIRECTOR, LEGISLATIVE FINANCE DIVISION
recommended that the section not be included in the
supplemental. He explained that the authority for the
projects has come through the Legislative Budget and Audit
Committee process. He observed that this differs from other
appropriations which come through the annual appropriations
bill. Revised programs are submitted to the Legislative
Budget and Audit Committee to modify or increase the
authority. He noted that EVOSS appropriations have been
authorized through the RPL process in the Legislative Budget
and Audit Committee. He observed that the Legislative
Budget and Audit Committee has concluded that the original
authority for the projects should be included in the normal
budget process. He noted that the Office of the Governor
has agreed to included this in their budget amendment
package.
Mr. Greany stated that if Section 7 is reinstated that
authorization would be duplicated. The existing projects
approved in FY 96 would be authorized to continue in FY 97.
Most of the projects are multiple year projects lasting 2 to
4 years. He suggested that the Committee follow the
recommendation of the Legislative Budget and Audit
Committee. He acknowledged problems with the opposing
fiscal years. He stated that the lapse could be extended to
September 30, 1996. He expressed concern with the
administration burden placed on the Department of Fish and
Game. He noted the effort needed to accommodate the
opposing fiscal years. He stressed that the Department of
Fish and Game should be requesting administrative support
from this funding source to alleviate the drain placed on
the Department in supporting EVOSS.
In response to a question by Representative Therriault, Mr.
Greany clarified that administration of EVOSS funds creates
additional work for the Department of Fish and Game. He
stressed that the Department is concerned that accounting
changes to accommodate the switch to operating budget
authorization will be burdensome. He reiterated that
sufficient EVOSS funds should be provided for the
administration of EVOSS projects to assure that the
Department is not supporting the cost of the program.
Co-Chair Hanley stressed that he did not want to see
additional money spent on administration.
(Tape Change, HFC 96-39, Side 2)
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Mr. Greany suggested that if the House Finance Committee
felt that a one time transition period was needed that the
lapse could be extended till September 30, 1996. He
clarified that his concern is that in trying to administer
EVOSS projects that there is not a diversion of effort from
other budgeted areas in the Department of Fish and Game.
Ms. Cramer stressed that EVOSS projects are different from
other types of projects by the Department of Environmental
Conservation and Department of Fish and Game.
Representative Brown MOVED to adopted Amendment 4, reinstate
Section 7, with an amended lapse date of September 30, 1996.
Mr. Greany noted that Amendment 4 included a new reference
to RPL 11-6-9992. The Trustee Council provided members of
the Committee with the amended lapse language in Amendment 4
(Attachment 3):
EXXON VALDEZ OIL SPILL TRUSTEE COUNCIL. The
appropriations to implement Trustee Council
restoration projects for federal fiscal year 1996,
which were made under the program review
procedures of AS 37.07.080(h) and set out in
revised programs 11-6-990 and 11-6-992, lapse into
the funds from which they were appropriated
September 30, 1996.
There being NO OBJECTION, Amendment 4 was adopted.
Section 3(f)
Representative Navarre MOVED to adopt Amendment 5
(Attachment 4). Amendment 4 would reinstate 3(f) at a
reduced level of $200.0 thousand dollars. Co-Chair Hanley
explained that Amendment 5 would provided the Department of
Community and Regional Affairs $200.0 of the anticipated
$306.0 thousand dollars needed by the Alaska Legal Services
for the remainder of FY 96.
Representative Navarre explained that $200.0 thousand
dollars would pay the majority of the attorney fees and
allow Alaska Legal Services to continue on to other cases.
BARBARA RITCHIE, DEPUTY ATTORNEY GENERAL, DEPARTMENT OF LAW
pointed out that the potential liability to the State is in
excess of $200.0 thousand dollars.
Representative Parnell asked why the appropriation would be
made to the Department of Community and Regional Affairs
instead of to the Department of Law. Ms. Ritchie stated
that the request is a early resolution to the issue. If it
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was a straight grant to Alaska Legal Services it would be
made to the Department of Community and Regional Affairs.
She stated that the appropriation will resolve issues in
respect to liability to Alaska Legal Services. It would not
resolve liability in respect to co-counsel in the Quinhagak
and Sorenson cases.
Co-Chair Hanley noted that the Department of Law believes
that the appropriation will save the State money.
TECHNICAL CORRECTIONS BY THE OFFICE OF THE GOVERNOR
NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF
MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR requested that
Amendment 1 be amended to delete "settlement in lieu of" and
insert "the". She explained that the amendment to Amendment
1 would clarify that the sum of $3,605.8 million dollars is
appropriated to the Department of Law to pay for the
judgement in Roger Berger d/b/a Frontier Financial Services
v. The State of Alaska.
Co-Chair Hanley MOVED to amend Section 10(c) to delete
"settlement in lieu of" and insert "the". Amendment 1
appropriates the sum of $3,605.8 million dollars to the
Department of Law to pay for the judgement in Roger Berger
d/b/a Frontier Financial Services v. The State of Alaska.
Section 2(b)
Ms. Slagle requested that language be amended on page 3,
line 14. She proposed that "into the general fund" be
deleted and be replaced with "lapses into the fund from
which it was appropriated." She explained that this would
clarify that part of the appropriation in Section 2(b) is
federal funds. Federal funds would be restricted. This
would only extend general funds. She clarified that no
additional federal funds were received. The authority to
receive federal funds would be lapsed.
Members discussed the grammatical structure of the
amendment. Representative Parnell suggested that the
amendment read "lapses on June 30, 1997 into the fund from
which it was appropriated."
Representative Parnell MOVED to adopt a conceptional
amendment to Section 2(b) by deleting "into the general
fund" and inserting "lapses on June 30, 1997 into the fund
from which it was appropriated." There being NO OBJECTION,
it was so ordered.
Section 5(a)
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Ms. Slagle noted that Section 5(a) on page 5, line 15 has
the same problem. She requested that the same change be
made in Section 5(a).
Representative Parnell MOVED to adopt a conceptional
amendment to Section 5(a) by deleting "into the general
fund" and inserting "lapses on June 30, 1997 into the fund
from which it was appropriated." There being NO OBJECTION,
it was so ordered.
OFFICE OF THE GOVERNOR - Section 17
Ms. Slagle stressed that problems will occur if Section 17
is not adopted. She stated that the Office of the Governor
will not have the ability to respond to disasters. Co-Chair
Hanley summarized that the issue is where the funding will
occur. He noted that discussions have occurred regarding
placement of the funds in the Department of Military and
Veterans Affairs with a caveat requiring some concurrence by
the Office of the Governor before the money is spent. He
noted that there are no parameters for funding under the
Office of the Governor.
Representative Grussendorf noted that communities often
contact the Office of the Governor when problems arise. He
maintained that the Office of the Governor is able to act
swiftly. He spoke in support of reinstating Section 17.
Representative Martin spoke in support of authorizing the
appropriation to the Department of Military and Veterans
Affairs. Discussion ensued regarding funding the
appropriation through the Office of the Governor or the
Department of Military and Veterans Affairs. Representative
Martin stressed that the Department of Military and Veterans
Affairs must evaluate the situation. Representative
Grussendorf emphasized that the Office of the Governor can
respond quickly.
Co-Chair Hanley observed that Title 26 states that it is the
intent of the Legislature and declared to be the policy of
the State that funds to meet disaster emergencies will
always be available. He noted that the first recourse shall
be the money regularly appropriated to state and local
agencies and that the second recourse shall be the money
available under the Disaster Relief Fund or under the Oil
and Hazardous Substance Release Response Fund. It further
states that if the Governor finds that these sources are
insufficient the Governor may transfer and spend money
appropriated for any other purposes or borrow money for a
term not to exceed two years. He noted that money has
generally been appropriated to the Disaster Relief Fund. He
concluded that the Governor's concern is not the access of
funds but the elimination of some expenditures.
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Representative Grussendorf restated that it is important
that the Governor have some money available to meet disaster
needs.
In response to a question by Representative Brown, Ms.
Slagle stated that the $557.0 thousand dollar request is to
meet disasters that have occur.
CAROL CAROLL, LEGISLATIVE LIAISON, DEPARTMENT OF MILITARY
AND VETERANS AFFAIRS clarified that there will be no funds
remaining in the Disaster Relief Fund after current
disasters are covered. Co-Chair Hanley noted that of the
$5.6 million dollar supplemental request $2.0 million
dollars is for major fire response. There is no money in
the Office of the Governor available for disasters.
Co-Chair Hanley asked for a written explanation of funds,
balances, and cash flow for disaster expenses. Ms. Slagle
stated that fire suppression expenses have been paid and
that there are no funds remaining.
(Tape Change, HFC 96-40, Side 1)
Ms. Slagle discussed procedures for obtaining additional
disaster funds during the interim. She observed that the
Senate President and House Speaker would be notified.
Additional authority is given for potential lapses in
anticipation of a supplemental request.
Co-Chair Hanley noted that he will continue to work with the
Office of Management and Budget on this item.
DEPARTMENT OF HEALTH AND SOCIAL SERVICES - Section 9(d)
Ms. Slagle pointed out that the Office of Management and
Budget is concerned regarding the denial of Section 9(d).
Co-Chair Hanley explained that fiscal notes should accompany
the establishment of the Fund. He observed that the Alaska
Family Independence Program is a two year fund to help with
the federal transition. He noted that the legislation has
not been adopted.
Co-Chair Hanley reiterated that the $3.5 million dollar
request in Section 9(b) was reduced to $1.9 million dollars
in general fund authorization and $1.6 other funds.
UNIVERSITY OF ALASKA - Section 16(a & b)
Co-Chair Hanley noted that Sections 16(a&b) were not
included in the Committee Substitute. Representative Martin
MOVED to reinstate Sections 16(a&b). He spoke in support of
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the University of Alaska employee contracts.
MICHAEL MAYBERRY, FIRST VICE PRESIDENT, CLASSIFIED EMPLOYEES
ASSOCIATION, UNIVERSITY OF ALASKA, FAIRBANKS spoke in
support of reinstating Section 16(a). He noted that the
University of Alaska and the Classified Employees
Association (CEA) signed a contract on February 20, 1995.
He observed that HB 305 was submitted to ratify the
agreement. He stressed that no Cost of Living Agreements
are contained in the contract. He noted that the contract
contains steps and ranges which average 11 percent below
that of the State. He emphasized that the lawsuit
introduced by CEA against the University of Alaska would not
be needed if the contract is funded. He clarified that the
money contained in HB 305 is the same as that contained in
Section 16(a). He restated that CEA is 11 percent below
Local 71 employees.
In response to a question by Representative Navarre, Mr.
Mayberry observed that new employees are hired under the
negotiated salary schedule.
RALPH MCGRATH, PRESIDENT, ALASKA COMMUNITY COLLEGE
FEDERATION OF TEACHERS (ACCFT) spoke in support of
reinstatement of Section 16(b). He observed that the issue
has been in dispute with the University of Alaska. The
contract was approved by the Legislature in May 1992. The
Board of Regents' policy was put in place calling for a 3
percent annual compensation increase. The University of
Alaska decided to suspend the policy a year and a half ago.
The issue was taken to arbitration. The arbitration process
was decided in favor of ACCFT. He clarified that litigation
is aimed at the suspension of the 3 percent annual increase.
The litigation would continue on the 1995 portion. In
response to a question by Co-Chair Hanley, Mr. McGrath
clarified that no legislation was submitted for the
appropriation in the past legislative session.
Representative Therriault noted that the Arbitrator ruled
that the University of Alaska did not have the power to set
aside the 3 percent annual increase provision. Mr. McGrath
stated that the Arbitrator determined that the 3 percent
increase is incorporated into the ACCFT contract and cannot
be removed at the discretion of the University. The Board
of Regents' policy remains in place until a new contract is
negotiated. He stated that ACCFT's legal case is based on
the fact that the request was not brought before the
Legislature.
In response to a question by Representative Brown, Mr.
McGrath observed that the contract terms were initially from
May 8, 1992 to June 30, 1994. The terms and conditions of
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the contract remain in place until a successor agreement is
negotiated. He observed that contract negotiations have
been in progress since April 1994.
Representative Brown spoke in support of reinstatement of
Section 16(b). She emphasized that the state of Alaska
should support its contracts.
Representative Navarre maintained that the University of
Alaska is responsible for funding the contracts through
their existing appropriation even if the Legislature does
not appropriate additional funds. Members debated whether
the contract could be turned down by the Legislature in the
current fiscal year. Representative Navarre suggested that
the contracts could not be turned down for FY 96 because the
obligation for the 3 percent increase began in July 1995.
Co-Chair Hanley disagreed with his interpretation.
Representative Martin asked for a comparison of ACCFT
salaries to other faculty members. In response to a
question by Representative Martin, Mr. McGrath clarified
that a successor contract has not been negotiated. He noted
that contracts cannot be negotiated for over 3 years. He
observed that ACCFT did not have a contract for five years
because the University broke state law and violated their
contract. He maintained that ACCFT employees' production
level is high. He noted that ACCFT faculty members teach 4
classes each.
Members were provided with a comparison of teacher's
salaries (Attachment 5). Mr. McGrath disagreed with
conclusions in Attachment 5. He noted that the graph was
not compiled with ACCFT's help or knowledge. Representative
Navarre echoed Mr. McGrath's comments regarding the
objectivity of the graph contained in Attachment 5.
Co-Chair Hanley clarified that the graph was prepared for
Representative Martin.
WENDY REDMAN, VICE PRESIDENT, UNIVERSITY OF ALASKA observed
that only a portion of the faculty at the Fairbanks campus
are at the doctrinal level. She clarified that the FY 96
portion of the ACCFT request was not requested in the prior
year. She observed that the arbitration was resolved in
April 1995. She clarified that the FY 95 request was
presented to the House Finance Committee in the previous
year.
Co-Chair Hanley disagreed that the FY 96 request would
automatically go into effect if it was never submitted to
the Legislature. He maintained that it is appropriate to
consider the FY 96 request. He stated that it did not seem
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proper to say that since the Legislature did not reject the
annual 3 percent increase that it has to be paid or the
University must fund it when it was never presented to the
Legislature. Representative Navarre maintained that there
was time for the Legislature to consider the 3 percent
increase as part of the budget. Co-Chair Hanley spoke
against inclusion of Section 16(a&b). He pointed out that
the Committee will hold hearings on all contracts.
In response to a question by Representative Kelly, Ms.
Redmond clarified that the CEA contract is contained in HB
305 which was not acted upon in FY 96. The FY 95 portion of
the ACCFT contract was included in Administration's FY 95
request. This is the first request before the Legislature
for the FY 96 ACCFT contract increase. Ms. Redmond added
that the full cost of implementation of the CEA contract is
contained in the request. Annual increases are subject to
annual appropriations.
Ms. Redmond further clarified that ACCFT accepted the same
pay scale as other non-organized university employees. That
pay scale went into effect on July 1, 1995. New employees
are being placed under the new contract. She explained that
the ACCFT contract called for existing employees to be
placed under the pay scale beginning July 1, 1995. She
concluded that since existing employees were not placed
under the new pay scale that new employees who are under it
can be hired at a higher salary.
(Tape Change, HFC 96-40, Side 2)
Representative Therriault asked if there was a policy
decision by the Board of Regents. Mr. McGrath stated that
the Board of Regents and CEA are working together to fund
the contract.
Representative Therriault stated that it was his impression
that the Legislature in rejecting all the contracts before
it intentionally chose to turn down the contract. He
disagreed that the Legislature must fund the pay raise.
Representative Navarre asked if the ACCFT contract provided
that the annual increase would be submitted to the
Legislature each year. Ms. Redmond explained that the
original contract cited that ACCFT would have the same
salary compensation increase policy that applied to all non-
organized employees. The contract cited the Board's policy.
At that time, the Board's policy was that 3 percent salary
increases would be requested each year. Subsequently the
Board suspended the policy based on budget reductions. The
union filed a series of four grievances based on the Board's
action. The Arbitrator ruled in the University's favor on
three of the grievances. The Arbitrator ruled that the
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Board is still bound by the policy that was in place in 1992
when the contract was negotiated. She read from the
contract (Attachment 6). She summarized that the contract
directs the University to make the request and to implement
funding if the request is approved. She observed that the
University and the unions disagree on the interpretation of
the contract.
Representative Navarre summarized that specific contracts
were rejected in FY 96. He pointed out that this contract
was not specifically turned down. He reiterated his belief
that the University will have to absorb the cost of the
contract if it is not appropriated by the Legislature.
Co-Chair Hanley stated that the contracts could be
specifically turned down. He discussed the CEA contract as
contained in HB 305. He summarized that if the employees
win the lawsuit, the University will have to assume the cost
of the raise. If the University wins the lawsuit and a
specific appropriation is not included, the employees will
not receive the increase
Co-Chair Hanley discussed the contract request for ACCFT.
He concluded that if Section 16(b) is taken out and language
is substituted stating that the request is not approved the
request would be turned down by the Legislature.
Co-Chair Hanley stressed that if the funding requests are
included that the contracts will be approved. He stated
that they can be discussed with other labor contracts.
Mr. Mayberry emphasized that Section 16(a) represents
placement on a salary schedule. He pointed out that the CEA
contract does not contain a COLA.
Representative Grussendorf asked if general fund program
receipts or other funds can be used to implement the
contract. Ms. Redmond noted that the request contains a
proportional assignment to the same other funds as are used
for other salaries. Program receipt authority is being
requested as part of the total funding package.
Mr. Mayberry stressed that the contract states appropriate
action or supplemental appropriation.
Representative Navarre asked if the University has submitted
the 3 percent ACCFT increase in a separate appropriation for
FY 97. Ms. Redmond stated that the submission was made in
the Governor's FY 97 operating budget. He suggested that
retroactively turning down a request that was not acted on
in the previous year is unfair and questionable. Co-Chair
Hanley noted that if the University wants a request to go
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forward they could withhold the request to prevent the
Legislature from turning the request down.
Representative Kelly spoke in support of addressing Section
16(a) through the legislative process.
Ms. Redmond noted that there is a statutory deadline on when
budget amendments can be made. She observed that the
University's request was made after the deadline for FY 96
amendments.
Representative Grussendorf summarized that no matter how
much land the University is given negotiated wages will
still be appropriated through the Legislature.
Representative Navarre asserted that the University has
submitted amendments past the legislative deadline through
legislators by request. He maintained that the University
could have submitted the issue in the past year.
Representative Grussendorf asked how the ACCFT contract will
be addressed. He spoke in support of the request. Co-Chair
Hanley stated that the request could be included in HB 305.
He noted that other contracts are included in the budget
process and will be discussed in the Committee.
Representative Martin WITHDREW his motion to reinstate
16(a&b).
Representative Navarre MOVED to included Section 16(a&b).
Representative Kohring OBJECTED. A roll call vote was taken
on the MOTION.
IN FAVOR: Brown, Grussendorf, Navarre
OPPOSED: Kelly, Kohring, Martin, Parnell, Therriault,
Foster, Hanley
Representative Mulder was absent from the vote.
The MOTION FAILED (3-7).
Representative Navarre MOVED to report CSHB 468 (FIN) out of
Committee with individual recommendations. There being NO
OBJECTION, it was so ordered.
CSHB 468 (FIN) was reported out of Committee with a "do
pass" recommendation.
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