Legislature(1997 - 1998)

03/02/1998 02:00 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
HOUSE BILL NO. 461                                                             
                                                                               
"An Act making supplemental and special                                        
appropriations; and providing for an effective date."                          
                                                                               
ANNALEE MCCONNELL, DIRECTOR, OFFICE OF MANAGMENT AND                           
BUDGET, OFFICE OF THE GOVERNOR, provided an overview of the                    
proposed time-sensitive appropriations from the Governor's                     
FY98 Supplemental Bill (HB397, SB292).  She assured                            
Committee members that the Administration had placed strict                    
limits on what would be considered time-sensitive.                             
                                                                               
DEPARTMENT OF REVENUE  -  1 (a)                                                
                                                                               
DAN SPENCER, CHIEF BUDGET ANALYST, OFFICE OF MANAGEMENT AND                    
BUDGET (OMB), OFFICE OF THE GOVERNOR, stated that 1(a)                         
would address the immediate funding for monies needed to                       
prevent cash-flow problems for the Bank of America                             
building.  Department of Administration (DOA) has been                         
paying maintenance costs out of their budget as a stopgap                      
measure, however, that budget is experiencing it's own cash                    
flow problems. Private tenants are currently paying AHFC,                      
and OMB would prefer to give AHFC the authority to contract                    
with DOA.  The request would address the fiscal note                           
situation resulting from last session.                                         
                                                                               
JOHN BITNEY, ALASKA HOUSING FINANCE CORPORATION (AHFC),                        
ANCHORAGE, advised that AHFC at this time has no authority                     
to use the receipts from the building to pay for operation                     
and maintenance costs.  AHFC has been collecting the                           
receipts in a separate holding account.  With this                             
authority, AHFC would RSA reimbursement to DOA for their                       
expenses.                                                                      
                                                                               
DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS - 1(b)                            
                                                                               
Co-Chair Hanley advised that Section 1(b) had been                             
addressed in HB 370.                                                           
                                                                               
DEPARTMENT OF CORRECTIONS - 1(c)                                               
                                                                               
Mr. Spencer explained that the requested appropriation                         
would be used to cover costs associated with Community                         
Residential Center (CRC) beds.  Some CRC contracts will                        
expire March 31, 1998.  The Department cannot implement                        
contracts to continue these beds if this requested funding                     
is not made available.                                                         
                                                                               
Representative Mulder commented that the Department is                         
looking into existing funding that could be applied.                           
                                                                               
DWAYNE PEEPLES, DIRECTOR, DIVISION OF ADMINISTRATIVE                           
SERVICES, DEPARTMENT OF CORRECTIONS (DOC), noted that since                    
the supplemental request was submitted, the Department has                     
done a reassessment of the CRC funding BRU's.  There is $18                    
thousand dollars available in a new CRC BRU, which could be                    
available because of start up delays of new beds.                              
Additionally, $64 thousand more dollars has been identified                    
in an existing CRC BRU, money which could also be made                         
available.  He noted that to date, the $236 thousand dollar                    
initial request could be reduced by $82 thousand dollars.                      
                                                                               
Mr. Peeples addressed the program receipts.  He stated that                    
$50 thousand dollars would come from the Drinking While                        
Intoxicated (DWI) Program.  The Department was authorized                      
to receive funds which were above the remaining account                        
balance in that program.  Co-Chair Hanley commented that                       
the in-mates occupying the beds would pay for a large                          
portion.                                                                       
                                                                               
DEPARTMENT OF HEALTH AND SOCIAL SERVICES - 1(d)                                
                                                                               
JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE                             
SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, stated                     
that the $100 thousand dollar appropriation request would                      
be used to fund the Maternal Child Care Clinics scheduled                      
to begin in late March.  These clinics may be cancelled if                     
a supplemental appropriation allowing use of program                           
receipts from clinic fees is not approved.                                     
                                                                               
KAREN PEARSON, HEALTH PROGRAMS MANAGER, DIVISION OF PUBLIC                     
HEALTH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, spoke to                     
the work performed by the specialty clinics.  With a                           
professional team traveling out to rural communities allows                    
those families not to have to travel to Anchorage or the                       
lower 48 in order to access medical services.                                  
                                                                               
Co-Chair Hanley pointed out that not all people pay for                        
services received at these clinics.  He asked if the                           
people, who do pay, cover costs of the clinics.  Ms. Clarke                    
understood that the clinics were subsidized through other                      
funding mechanisms.  Last year, the Department received                        
funding through Alaska Mental Health Trust Authority as                        
well as federal block grants.  She agreed that program                         
receipt revenue does not cover the full cost of the                            
clinics.                                                                       
                                                                               
Co-Chair Hanley questioned why a supplemental request                          
exists when the Department had these clinics included in                       
last year's budget proposal.  Ms. Pearson explained that                       
the program staff was not aware during last year's budget                      
that the Division would no longer be able to go to the                         
Legislative Budget and Audit Committee (LBA) for additional                    
program receipts.                                                              
                                                                               
Representative Foster echoed concern.  Ms. Clarke noted                        
that the Department does have some remaining funds                             
resulting from an increase received from the FY99 Mental                       
Health Trust Authority which could continue some clinics.                      
                                                                               
DEPARTMENT OF MILITARY & VETERAN'S AFFAIRS - 1(e)                              
                                                                               
NICO BUS, BUDGET COORDINATOR, DEPARTMENT OF MILITARY &                         
VETERAN'S AFFAIRS (DMVA), stated that the requested funding                    
would coordinate federal receipts for Poker Flats Research                     
Range.  The Department will transfer funding to the                            
University of Alaska so that construction can begin this                       
spring.                                                                        
                                                                               
The specific work to be done would happen over a two year                      
time frame, costing about $20 million federal dollars.                         
Those funds would be used for refurbishment of a road and                      
the technology support.  He noted that because of existing                     
agreements, it would be easiest for those funds to be                          
distributed through DMVA.  The Department would act as                         
funding conduit.  Mr. Bus noted that there would be no                         
money for the Department.                                                      
                                                                               
Representative Martin pointed out that Section 1(e) and                        
1(i) represented the same money.  He asked if the funds                        
would conflict with the Kodiak Space Center.  Co-Chair                         
Therriault explained that Poker Flats rockets were                             
atmospheric sounding rockets and which could not achieve                       
orbit; the Kodiak facility rockets will orbit.                                 
Representative Martin asked how much money had been spent                      
over the past five years for upgrading.                                        
                                                                               
MARY LOU BURTON, (TESTIFIED VIA TELECONFERENCE), UNIVERSITY                    
OF ALASKA, FAIRBANKS, believed that approximately $10                          
million dollars has been spent since 1990.  The project has                    
been 100% federally refunded.                                                  
                                                                               
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES - 1(f)                      
                                                                               
Co-Chair Hanley questioned why this item had been included                     
in the fast track supplemental.                                                
                                                                               
NANCY SLAGLE, DIRECTOR, DIVISION OF ADMINISTRATIVE                             
SERVICES, DEPARTMENT OF TRANSPORTATION AND PUBLIC                              
FACILITIES (DOTPF), stated that this stretch of the road is                    
in great need of repair.  It had been included in the State                    
Transportation Improvement Program (STIP) to fix sections                      
of the road during a five years period beginning in 2000.                      
Because of the damages, which occurred this summer, the                        
Department realized they needed to speed up the work.  The                     
road has deteriorated.  The Federal Highway department has                     
granted approval for this project.                                             
                                                                               
The Department is rapidly working to get the proposal                          
completed in order to go to bid by April so that the                           
repairs could be done by August.  She pointed out that many                    
states are currently using federal highway money to                            
maintain roads, although it requires each state to provide                     
a plan.                                                                        
                                                                               
Ms. Slagle pointed out that a specific section of road has                     
been identified for repair.  The State would not be allowed                    
to undertake general overall maintenance when attempting to                    
meet Federal Highway approval, yet, specific work will be                      
approved.                                                                      
                                                                               
Co-Chair Hanley asked if the State had overappropriated                        
it's original match or if the Department had held off on                       
already approved federal projects.                                             
                                                                               
THOMAS BRIGHAM, DIRECTOR, DIVISION OF STATEWIDE PLANNING,                      
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES, replied                    
that neither point had occurred.  The Department has                           
increased the size of the FY98 program to general                              
expectation.  The Tok project fits into bigger project                         
funding appropriated by the federal government, which would                    
not displace other projects.                                                   
                                                                               
Co-Chair Hanley inquired the total highway match for this                      
year.  Mr. Brigham replied it would be in the amount of                        
$24.5 million dollars.  Because of new federal                                 
authorization, there could be additional federal funds                         
available.  The average match rate is 10%.                                     
                                                                               
Co-Chair Therriault asked if the proposed increment would                      
cause a shift to any other proposed project.  Mr. Brigham                      
stated that nothing would be displaced and no major design                     
would be needed.                                                               
                                                                               
DEPARTMENT OF FISH AND GAME - 1(g)                                             
                                                                               
KEVIN BROOKS, DIRECTOR, DIVISION OF ADMINISTRATIVE                             
SERVICES, DEPARTMENT OF FISH AND GAME, stated that the                         
requested allocation would be used for subsistence harvest                     
research projects.  He added, early approval of federal                        
receipts would allow timely completion of these projects.                      
There are five separate small projects included in the                         
request, all of which will need to be completed by                             
September 30, 1998.  He added that this would be a 100%                        
federal fund.                                                                  
                                                                               
Representative Foster argued the point that the Nome                           
subsistence position had been cut leaving sixteen positions                    
residing in Anchorage.  He indicated his resentment in                         
supporting sixteen subsistence positions in Anchorage when                     
the need is in Bush Alaska.  Mr. Brooks responded that the                     
economics of maintaining Bush Alaska offices and leases                        
became prohibitive.  Flying from village to village is                         
expensive.  The Anchorage office has always been the hub.                      
He summarized that the budget has been cut so small, it is                     
impossible for the Department to cover such a wide area.                       
                                                                               
DEPARTMENT OF LABOR - - 1(h)                                                   
                                                                               
REBECCA GAMEZ, DIRECTOR, DIVISION OF EMPLOYMENT SERVICES,                      
DEPARTMENT OF LABOR (DOL), explained that the $3 million                       
dollar supplemental request would be used to establish the                     
Alaska Disaster Assistance Program (ADAP).  Early approval                     
will allow relief for those persons suffering from the loss                    
of their primary income due to the poor salmon-fishing                         
season in Bristol Bay.                                                         
                                                                               
Representative Martin asked how the program was different                      
from HB 370.  Ms. Gamez explained that this was not a loan                     
program; it was an entitlement program.  DOL anticipates                       
quick turnover costs.  Administrative costs will amount to                     
approximately 8.4%; $2.75 million dollars will be available                    
to 54 communities in the State.                                                
                                                                               
Co-Chair Hanley asked if the Department used guidelines                        
similar to those established by FEMA.  Ms. Gamez responded                     
that the determination would be based on a combination of                      
regulations and laws and would include some of those used                      
through FEMA.  The federal government turned that request                      
down. An amount had been determined by estimating the                          
maximum number of people that would be eligible under the                      
Disaster Unemployment Assistance program and then used the                     
average unemployment benefit rate received.                                    
                                                                               
Representative Martin asked why the program had been                           
limited to Bristol Bay.  Ms. Gamez replied that the                            
Division had "stuck" with the basic FEMA request made a                        
number of months ago and did not expand it.  Representative                    
Martin suggested adding language specifying all communities                    
that could qualify for the funding.                                            
                                                                               
(Tape Change HFC 98- 48, Side 2).                                              
                                                                               
Co-Chair Hanley noted that to undertake this request would                     
require additional legislation.  Normally there would be a                     
fiscal note attached with the bill.  Mr. Spencer questioned                    
where the fiscal note would show up; he recommended the use                    
of conditional language.  A fiscal note would provide                          
appropriation contingent upon the bill passing.                                
Appropriation could be made in the bill, but if the bill                       
did not pass, the appropriation would be no good.  Co-Chair                    
Hanley noted that there could be an appropriation bill                         
tagging along with the legislation.                                            
                                                                               
UNIVERSITY OF ALASKA - 1(i)                                                    
                                                                               
Co-Chair Hanley noted that Section 1(i) was tied with                          
Section 1(e).                                                                  
                                                                               
DEPARTMENT OF MILITARY & VETERAN'S AFFAIRS - 1(j)                              
                                                                               
Mr. Bus explained that the appropriation would fund the                        
Youth Corps ChalleNGe program.  He stated that early                           
approval was needed to begin the next scheduled class on                       
March 16, 1998.  He advised that $250 thousand dollars had                     
been allocated in the FY98 budget to support the program                       
with the understanding that the Department could come back                     
during the supplemental budget process.                                        
                                                                               
The Department did not know what the federal funding                           
commitment would be.  The initial allocation for Alaska was                    
about $2 million dollars.  DMVA continues to run the                           
program in anticipation of 80 graduates per class in each                      
of the two classes.  In order to get the program back up to                    
par; the Department is proposing supplemental funding                          
request in the amount of $608 thousand dollars to secure                       
the program through June, 1998.                                                
                                                                               
Co-Chair Hanley asked the total anticipated budget for the                     
year.  Mr. Bus replied that it would be $3.4 million                           
dollars, consisting of State and federal funding.  The                         
federal government has committed to $2.1 million dollars.                      
Co-Chair Hanley asked the amount of the request if there                       
were 60 graduates.  Mr. Bus explained that becomes                             
complicated as the federal guidelines require 75% federal                      
funds for 25% State funding match requirements.  Co-Chair                      
Hanley requested an impact statement indicating the cost                       
differential for 60 and/or 80 graduates.  He pointed out                       
that the percentage provided by the feds is declining.                         
                                                                               
Representative Foster pointed out that when the program                        
started it was a total federally funded program, however,                      
at this time, the projection is that federal funding will                      
pay 60% of costs and the State will provide 40% of the                         
associated costs.  Representative Foster pointed out that                      
the cost per graduated student is approximately $22                            
thousand dollars.  Mr. Bus advised that the program was                        
geared to the "at-risk" youth and that it is a cost                            
avoidance program.  The cost of sending a youth to a                           
correctional facility is approximately $66 thousand                            
dollars.  Mr. Bus emphasized that at-risk youth really                         
benefit from the program.                                                      
                                                                               
DEPARTMENT OF ADMINISTRATION - 1(k)                                            
                                                                               
Mr. Spencer noted that the Department of Administration                        
(DOA) was requesting funding for needed monthly lease                          
payments for the period from now through May, 1998.                            
                                                                               
SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE                            
SERVICES, DEPARTMENT OF ADMINISTRATION, advised that when                      
the FY98 budget had been passed, DOA projected that budget                     
would be short approximately $1.7 million dollars.  The net                    
effect of activity since that time has resulted in a total                     
request of $1.4 million dollars.                                               
                                                                               
HB 461 was HELD in Committee for further consideration.                        
                                                                               

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