Legislature(1995 - 1996)
04/17/1996 01:50 PM House FIN
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* first hearing in first committee of referral
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SENATE BILL NO. 232
"An Act relating to permanent fund dividend program
notice requirements, to the ineligibility for dividends
of individuals convicted of felonies or incarcerated
for misdemeanors, and to the determination of the
number and identity of certain ineligible individuals;
and providing for an effective date."
TOM WILLIAMS, STAFF, SENATOR FRANK testified in support of
SB 232. He noted that the legislation expands both the pool
of criminals who are ineligible for a permanent fund
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dividend (PFD) check and the specific criminal justice
system agencies eligible to use the dividends denied to
those criminals. He noted that SB 232 resembles SB 135
which was vetoed by the Governor in June 1995. He explained
that SB 232 does not contain the timing provision to which
the Governor objected. It also clarifies and restricts the
purposes for which denied dividends can be used. It
requires the Department of Revenue to print on the dividend
stub public notice of the criteria and the legislative
purpose for denying permanent fund dividends to individuals,
and the total amount that was appropriated to each of the
agencies eligible to receive funds. He observed that SB 232
will make PFD's of another 2,000 criminals available for
appropriation to the criminal justice system in FY 2000.
The effective date is 1/1/97.
Mr. William provided members with two amendments (copy on
file). Amendment 1, 9-LS1455\K.1. The House Judiciary
Committee added a provision that would count misdemeanors
and similar crimes that occurred in other jurisdictions.
This created problems with the Department of Public Safety.
Amendment 1 would provide that only in-state crimes be
counted.
Amendment 2, 9-LS1455K.3 would make a technical correction.
It clarifies that any two prior convictions would make an
individual ineligible upon the third misdemeanor
convictions. This would make an individual ineligible if
either of their previous convictions was for a felony.
Mr. Williams observed that the House Judiciary Committee
made it allowable to count offenses that occurred prior to
the effective date of the legislation. The Department of
Law would like to see a five year limit. The Department of
Corrections estimates that the amendment by the House
Judiciary Committee would increase the number of ineligible
individuals.
Representative Brown expressed concern with the displacement
of funding from child support, court ordered fines, and
alcohol rehabilitation. She asked how many of the estimated
2,000 applicants that would be denied currently have their
PFD's garnished. She spoke against transferring funds from
families and victims to the bureaucracy in order to displace
general funds.
Mr. Williams did not know how many individuals would have
their PFD's garnished. He stated that of new ineligibles
approximately 46 of 2,000 would be impacted. He stressed
that this would be mitigated because under the legislation
the collection would only be delayed. He explained that
individuals convicted would lose their PFD's in the year
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that they are convicted of a felony or incarcerated for a
misdemeanor. He maintained that the largest impact would be
if incarceration crossed two calendar years. He pointed out
that 100 percent of each garnished dividend would
necessarily be collected under current law. Under SB 232
one hundred percent of the dividends are collected.
Representative Brown disagreed that only 46 PFD's would be
garnished. She estimated that 105 PFD's would be garnished.
She maintained that all 211 Aid to Families with Dependent
Children (AFDC) cases will be affected.
Mr. Williams explained that the analysis he quoted related
to involuntary payments of the garnishment of dividends to
make AFDC payments. He acknowledged that potentially 211
individuals will not have the funds.
Representative Brown referred to a memorandum by the Child
Support Enforcement Division to Nanci Jones, dated May 5,
1995 (copy on file). She stated that the Division estimates
at least twice as many families would be affected. Mr.
Williams noted that Ms. Vogt indicated that there were no
problems with the estimations used by the sponsor.
In response to a question by Representative Parnell, Mr.
Williams noted that an attempt to use funds for a specific
purpose would violate an equal protection provision.
Representative Brown questioned how many dividends would
have been garnished under court ordered restitution. Mr.
Williams had no specific information in regards to court
ordered restitution or fines.
Representative Brown observed that many of the criminals
would be reliant on their PFD's to make restitution to their
victim. She maintained that money would be taken from
victims and spent on state government. Mr. Williams replied
that the legislation was introduced to assure that money is
put back into the criminal justice system. He stressed that
the intent is to obtain 100 percent of these dollars.
In response to a question by Co-Chair Hanley, Mr. Williams
explained that incarcerated felons are currently denied
dividends. Dividends of felons are not available for
restitution or child support.
Representative Brown noted that there was an accounting
shortfall for FY 96 due to the over estimation of felons'
PFDs to be garnished. She asked how the legislation would
account for garnished PFDs. Mr. Williams stated that the
Department of Corrections has a fiscal note accompanying the
legislation to improve their accounting ability and to
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better coordinate with the Department of Public Safety.
In response to a question by Representative Brown, Mr.
Williams explained that felons lose their dividends in the
year of conviction and during incarceration. If an
individual did not go to jail their eligibility would resume
the following year. Eligibility is regained after release
from incarceration. Individuals on probation or parole are
eligible.
Representative Brown asked how individuals will be
accounted. Mr. Williams stated that information will be
coordinated by the Department of Corrections. The
Department of Corrections will receive information from the
Department of Public Safety, the Department of Law and the
Alaska Court System.
Mr. Williams reiterated that funding will not be available
until FY 2000. Representative Mulder noted that revenues
will be spent immediately. Mr. Williams stated that there
will be some reporting and coordination costs. He stressed
that returns will be upwards of $2.0 million dollars annual
from the year 2000.
In response to a question by Representative Mulder, Mr.
Williams noted that the Department of Corrections' fiscal
note was zero in the previous session. The Department of
Corrections' fiscal note was increased to $68.7 thousand
dollars. Mr. Williams pointed out that the legislation did
not changed.
Representative Brown noted that potential revenues are not
included in the fiscal notes. Mr. Williams stressed that
there is not a specific amount that would be appropriated to
any particular department. He observed that the Department
of Public Safety recognizes that they would be eligible to
receive funds. He explained that the estimation of $2.0
million dollars is based on 2,000 dividends of $1,000
dollars each.
Representative Brown asked why the legislation expands
eligible agencies to include the Department of Public Safety
and the Department of Law. Mr. Williams stated that the
intent is to establish clear linkage between denying an
increased number of PFDs and the criminal justice system as
required by the court decision. He observed that the
language does require legislative appropriation. He
maintained that it is not the intent of the sponsor to
redirect existing funding. It is the intention that
additional funds would be available to the other agencies.
Representative Brown noted that funds are inadequate to
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cover existing programs. She spoke in support of retaining
the current recipients. She asked if the court requires
that the other agencies be added. Mr. Williams noted that
the Anthony decision does not require additional agencies.
Co-Chair Hanley noted that it would be up to the legislature
to appropriate funds. Representative Brown maintained that
the clear linkage is there and would remain whether the
other agencies are added or not. Mr. Williams maintained
that the legislation would strengthen the State's position.
Representative Brown asked if all new ineligibles would be
incarcerated. Mr. Williams explained that individuals that
are convicted of a felon but not incarcerated would lose
their dividend in the year they were convicted. Third time
incarcerations of a misdemeanor would also be included.
Representative Parnell referred to the equal protection
issue. Mr. Williams explained that public funds cannot be
used for a private purpose. Funds cannot be paid to the
Child Support Enforcement Division to satisfy a private
obligation.
Representative Parnell noted that private judgement are
subject to priorities of garnishment. He questioned if the
same system is possible for convicted felons and
misdemeanant. Mr. Williams clarified that the State is not
appropriating a specific felon's funds. The State is
appropriating money that was denied to the felon. Co-Chair
Hanley observed that felons are not required to apply for a
dividend.
In response to a question by Representative Brown, Mr.
Williams clarified that the Alaska Supreme Court decision
Anthony vs. State was issued in April 1991.
Representative Mulder MOVED to adopt Amendment 1. Mr.
Williams noted that Amendment 1 restricts convictions to in-
state convictions for consideration. The amendment will
allay concerns by the Department of Public Safety and the
Department of Law in regards to the release of out-of-state
records. There being NO OBJECTION, it was so ordered.
Representative Mulder MOVED to adopt Amendment 2. Mr.
Williams
explained that Amendment 2 clarifies that upon a third
incarceration for a misdemeanor an individual with two prior
crimes, felonies or misdemeanors, would be ineligible for a
PFD. He noted that "crimes" is defined under AS
11.91.900(9).
Co-Chair Hanley noted that under the current language a
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person who was convicted of two felonies and then was
convicted for a misdemeanor would not have their dividend
withheld. Someone with three misdemeanors would lose their
dividend.
Representative Brown noted that a misdemeanor is not a crime
if it does not involve imprisonment under the definition of
"crime". She questioned the effect on a misdemeanor
conviction without incarceration. Co-Chair Hanley pointed
out that a misdemeanor carries up to a year imprisonment.
Incarceration does not have to follow a misdemeanor
conviction. Mr. Williams noted that imprisonment can be up
to one year under a misdemeanor.
ANNE CARPENETI, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF
LAW testified that most misdemeanors have the possibility of
jail time. She observed that under AS 11.81 a misdemeanor
is defined as an offense for which prison is authorized.
Representative Brown expressed concern that "misdemeanor" is
contained in other places in the legislation. Mr. Williams
suggested that "crimes" be amended to "two or more prior
misdemeanors or felonies." He noted that page 2, line 17
refers to noticing requirements.
(Tape Change, HFC 96-125, Side 2)
Representative Brown noted that "misdemeanor" is not tied to
the definition of crimes in other areas of the legislation.
She expressed concern that there are misdemeanors that are
not a criminal offense. She questioned if an individual has
two crimes and is convicted of a non-criminal offense
misdemeanor would they lose their dividend. Co-Chair Hanley
stated that misdemeanors that do not authorize incarceration
would not count as one of the three convictions. He
observed the definition of "crimes" under AS 11.81.900(9).
Ms. Carpeneti referred to page 2, line 15. She observed
that the legislation states that "immediately preceding that
dividend year, the individual was incarcerated as a result
of... a conviction of a felony or a third or subsequent
conviction of a misdemeanor." The conviction itself of a
misdemeanor would not evoke the provision. The
incarceration for a conviction of a misdemeanor would result
in the loss of the dividend.
Mr. Williams agreed that it is the incarceration for a third
conviction which happens to be a misdemeanor that activates
the section. He reiterated that "crimes" could be amended
to "two or more prior misdemeanors or felonies."
Co-Chair Hanley felt that the Committee was satisfied with
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"crimes". Representative Brown stated that the language
should be tied to imprisonment. Ms. Carpeneti reiterated
that the legislation ties misdemeanors to incarceration.
Representative Brown argued that AS 11.81.900(9) only
addresses the definition of crime, not the definition of
misdemeanor. Ms. Carpeneti suggested that all the
definitions in AS 11.81.900 could be referenced.
Representative Mulder maintained that it is appropriate that
those people that cost the system defer a portion of the
cost. Representative Brown agreed that forfeitures should
be tied to incarceration. She added that the definition of
"misdemeanor" in AS 11.81.900 should be referenced.
Representative Mulder recommended that the reference to
"(9)" be deleted.
Representative Mulder MOVED to AMEND Amendment 1 by deleting
"(9)" on line 17, page 2. Mr. Williams expressed concern
that the proposed amendment to Amendment 1 would complicate
the process in regards to identifying ineligible individuals
and increase the fiscal cost. He stated that it would be
simpler to delete "crimes" and insert "two or more prior
misdemeanors or felonies". There being NO OBJECTION, "(9)"
was deleted.
Representative Brown provided members with Amendment 3 (copy
on file). She explained that Amendment 3 would delete the
new insertion for operation of safe houses and shelters, the
Department of Public Safety and Department of Law. She
stated that the amount of dividends collected are not
sufficient to fund the current activities. She observed
that the Crime Victim Compensation Fund is significantly
under-funded in the current budget. She expressed concern
that broadening the base of agencies eligible for the funds
would result in the loss of the main focus of the current
law.
Co-Chair Hanley questioned why funds to the Council of
Domestic Violence and Sexual Assault would be restricted to
the operations of safe houses and shelters. Mr. Williams
replied that the intent is that funds be directed to the
function and not the administrative overhead of the
agencies. He added that the sponsor wanted to improve the
linkage from the denial of dividends to the use of the
dividends. Co-Chair Hanley pointed out that operations
would include administrative overhead.
JAYNE ANDREEN, EXECUTIVE DIRECTOR, COUNCIL ON DOMESTIC
VIOLENCE AND SEXUAL ASSAULT testified that the Council did
not anticipate a significant impact from the language. She
observed that all PFD money received has been used in the
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grant line. She stressed that the operation of safe homes
and shelters includes crisis intervention services, child
services and the administrative cost of the local program.
She questioned the intent in the level of tracking funds
that would be expected.
Mr. Williams noted that the intent is that funding not be
for state administrative costs. He did not object to the
use of funds for administrative costs relating to grants.
The intent is that the money be used for the grant program.
Representative Brown expressed concern that the small pool
of money is being spread over more participants. She
observed that there was a $600.0 thousand dollar shortfall
in PFD projections.
Ms. Andreen expressed concern about the number of state
agencies that would receive the funds. She noted that there
is a shift in public policy. She stressed that two of the
three entities that currently receive funds are the ones
that provide direct services to victims. She emphasized the
shift from victim assistance to basic state government
support.
Representative Martin maintained that the legislation may be
too restrictive. He noted that criminals may be paying for
domestic violence assistance when their crime was for
another reason.
Representative Brown clarified that the amendment deletes
the expansion to the Department of Law and Department of
Public Safety. She observed that the Crime Victim
Compensation Fund, the Council on Domestic Violence and
Sexual Assault and the Department of Corrections would be
still receive the funds. She emphasized that there are not
sufficient funds for the three existing entities.
Representative Brown MOVED to AMEND Amendment 3 to delete
"operation of safe houses and shelters." There being NO
OBJECTION, it was so ordered.
Representative Parnell spoke in support of Amendment 3. He
echoed remarks by Representative Brown. Co-Chair Hanley
spoke against Amendment 3. He stressed that the amendment
would restrict the legislature's flexibility.
A roll call vote was taken on the MOTION to adopt Amendment
3.
IN FAVOR: Brown, Grussendorf, Navarre, Therriault, Parnell
OPPOSED: Kelly, Kohring, Martin, Mulder, Foster, Hanley
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The MOTION FAILED (5-6).
Ms. Carpeneti recommended that Amendment 2 be amended on
line 17 to insert "within the previous five year period."
She stressed that a limit is needed. She observed that DWI
laws allow convictions in the previous five years to be used
in constituting a felony.
In response to a question by Representative Brown, Ms.
Carpeneti clarified that the third crime must occur after
the effective date of the legislation.
Representative Grussendorf questioned how time in
incarceration would be counted. Ms. Carpeneti explained
that for purposes of presumptive sentencing, the legislation
allows the ten previous years that the person was not
serving time in prison, or was on parole or probation to be
counted.
Mr. Williams stated that he would prefer the original
version which would count all crimes effective January 1,
1997. Co-Chair Hanley pointed out that 30 years from the
effective date the crimes would go back 30 years.
Representative Martin asked if time would be based on
calendar years or the date of conviction. Ms. Carpeneti
stressed that either could be used.
Co-Chair Hanley stated that there would be fewer individuals
affected if a five year limit is adopted.
Mr. Williams stressed that the sponsor would prefer that
section 6 of CSSB 232 (FIN) be substituted for the similar
provision contained in HCS CSSB 232 (JUD). This would
provide a January 1, 1997 effective date. Crimes from that
point would be counted.
Representative Mulder MOVED to delete section 6 and insert
CSSB 232 (FIN), section 6.
(Tape Change, HFC 96-126, Side 1)
Representative Martin OBJECTED to the motion to delete
section 6 and insert CSSB 232 (FIN), section 6.
Representative Mulder stressed that the amendment would
allow a reduction in the Department of Corrections' fiscal
note. He emphasized that it would be difficult to research
records to find two convictions. Representative Brown spoke
in support of the amendment. She observed that the
Department of Corrections' accounting system is accurate.
Representative Martin MOVED to AMEND the Amendment to begin
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the counting as of January 1, 1988. Co-Chair Hanley
OBJECTED. He clarified that "January 1, 1997" would be
changed to "January 1, 1988."
ANNETTE SMITH, DEPARTMENT OF CORRECTIONS noted that the
Department cannot determine the number of convictions. The
Department can determine the number of incarcerations. The
Department of Corrections would have to obtain information
from the Department of Public Safety, the Department of Law
or the Alaska Court System on the number of prior
convictions. She acknowledged that the Department of Public
Safety maintains the information on an automatize system.
The Department of Public Safety would have to supply the
information.
DEL SMITH, DEPUTY COMMISSIONER, DEPARTMENT OF PUBLIC SAFETY
noted that the Department could provide the information
received from the Alaska Court System. He observed that the
Department of Corrections is a criminal system agency and
would have full access to the information on the Department
of Public Safety data system.
CHRIS STOCKARD, DEPARTMENT OF CORRECTIONS stressed that the
Department would not know if an individual had prior
convictions without doing a manual record check. She
explained that the mandate to look at prior convictions
requires the Department to obtain information from other
agencies.
Representative Mulder referred to the presentence report.
Ms. Smith noted that pre-sentencing reports are tracked
manually.
Representative Brown asked the cause of the shortfall in
accounting for 1996 PFD. Ms. Smith discussed changes that
resulted in a reduction of individuals being reported.
A roll call vote was taken on the MOTION.
IN FAVOR: Kohring, Martin, Therriault
OPPOSED: Brown, Grussendorf, Navarre, Kelly, Mulder,
Hanley, Foster
Representative Parnell was absent from the vote.
The MOTION FAILED (3-7).
There being NO OBJECTION, section 6 was deleted and CSSB 232
(FIN), section 6 was inserted.
Representative Mulder suggested that the fiscal note could
be reduced. He noted that the Department is already
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tracking prior felony convictions in relation to the
presentence reports.
Ms. Smith noted that the evaluation is not used in reporting
to the Permanent Fund Dividend Division because the system
is not automated. She added that the current statute only
requires that incarcerated felons be reported. The
Department reports based on incarceration.
Representative Mulder MOVED to report HCS CSSB 232 (FIN) out
of Committee with individual recommendations and with the
accompanying fiscal note. Representative Brown OBJECTED for
purposes of discussion. She stressed that money will be
displaced from treatment agencies, child support and victims
of crimes. She maintained that most of the individuals
affected are low income or indigent.
A roll call vote was taken on the MOTION to move HCS CSSB
232 (FIN) from Committee.
IN FAVOR: Grussendorf, Kelly, Martin, Mulder, Navarre,
Therriault, Foster, Hanley
OPPOSED: Kohring, Brown
Representative Parnell was absent from the vote.
The MOTION FAILED (2-8).
HCS CSSB 232 (FIN) was reported out of Committee with a "do
pass" recommendation and with six fiscal impact notes; two
by the Department of Revenue, dated 3/8/96; one by the
Department of Corrections, dated 3/8/96; three by the
Department of Public Safety, dated 3/8/96; and with a zero
fiscal note by the Department of Law, dated 3/8/96.
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