Legislature(2013 - 2014)HOUSE FINANCE 519

02/18/2014 01:30 PM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSHB 211(FIN) Out of Committee
Moved CSHB 263(HSS) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
HOUSE BILL NO. 263                                                                                                            
     "An Act extending senior benefits."                                                                                        
1:36:21 PM                                                                                                                    
Representative Costello  moved the  House Health  and Social                                                                    
Services Committee bill version before the committee.                                                                           
REPRESENTATIVE  MIKE  HAWKER,  SPONSOR, relayed  the  change                                                                    
made in the  CS tightened up the bill  title to specifically                                                                    
reference the  Alaska senior  benefits payment  program. The                                                                    
bill would  extend the existing senior  benefits program for                                                                    
six years from June 30, 2015 to June 30, 2021.                                                                                  
Co-Chair  Stoltze remarked  that the  largest issue  was the                                                                    
"lengthy" extension.  Representative Hawker stated  that the                                                                    
opinion was that of the co-chair.                                                                                               
Representative  Hawker  communicated  that  the  bill  would                                                                    
provide  a needs-based  financial supplement  to seniors  in                                                                    
Alaska  based  on the  federal  poverty  level. The  program                                                                    
offered a $250  per month stipend to seniors  who fell below                                                                    
75 percent of the federal  poverty level, $175 to seniors at                                                                    
the 100 percent  federal poverty level, and  $125 to seniors                                                                    
at 175  percent of the  federal poverty level.  He addressed                                                                    
the length  of the  extension in relation  to the  number of                                                                    
seniors  benefitting from  the  program  and the  relatively                                                                    
small stipend.  The average  age of  the recipients  was 75;                                                                    
the  benefits served  seniors  up  to the  age  of 103.  The                                                                    
population was  increasingly aging and vulnerable  and faced                                                                    
escalating  medical,  housing,  and  food  costs.  The  bill                                                                    
helped  to  provide  elderly  Alaskans  who  had  the  least                                                                    
resources  and most  limited  ability  to secure  employment                                                                    
with a relatively small stipend  to support their lives. The                                                                    
program  provided  assurance  and  comfort  to  the  state's                                                                    
senior citizens.  He stressed that it  was the legislature's                                                                    
priority  to  be  concerned about  senior  citizens  in  the                                                                    
state. He addressed the length  of the program extension and                                                                    
believed that for the price of  the program it should be one                                                                    
of the  state's highest  priorities. He opined  that because                                                                    
the program was a high  priority, a long-lived extension was                                                                    
1:41:20 PM                                                                                                                    
Representative Hawker  spoke to  the reason the  program was                                                                    
not open-ended and  implemented in statute. He  was proud of                                                                    
senior advocates who had communicated  that it was important                                                                    
to revisit the issue over  time. He elaborated that it would                                                                    
be  necessary  to evaluate  the  program  parameters in  the                                                                    
future  to   determine  whether   it  remained   viable.  He                                                                    
hypothesized  that the  world could  change sufficiently  in                                                                    
six years  and increasing the program's  generosity could be                                                                    
warranted at  that time.  He relayed  that the  maximum time                                                                    
for extending  boards and commissions  was eight  years; the                                                                    
bill's   six-year   term  communicated   the   legislature's                                                                    
commitment  to seniors  in the  state.  The extension  would                                                                    
ensure certainty  for the individuals benefitting  under the                                                                    
program and would also allow  the legislature to revisit the                                                                    
issue in a reasonable period of time.                                                                                           
1:43:12 PM                                                                                                                    
Co-Chair Austerman did not disagree  with statements made by                                                                    
Representative  Hawker;  however,   he  believed  under  the                                                                    
current  budgetary circumstances  that the  extension should                                                                    
be shortened to  three years. He agreed that  perhaps in six                                                                    
years the program  benefits could be increased  if the state                                                                    
was  facing  an  improved   financial  environment.  He  was                                                                    
currently uncomfortable  extending the  program too  far out                                                                    
into the future.                                                                                                                
Representative Gara  appreciated the  bill. He  relayed that                                                                    
had introduced  a similar bill with  other minority members.                                                                    
He  discussed the  former longevity  bonus program  that did                                                                    
not  have a  sunset; however,  as beneficiaries  passed away                                                                    
the cost  of the program  declined. He supported  the senior                                                                    
benefits program. He  opined that it was  difficult to argue                                                                    
when the  sunset should  occur. He  discussed that  the bill                                                                    
was  fair  and  fiscally  conservative  given  that  benefit                                                                    
levels  had not  been  raised.  He noted  that  a number  of                                                                    
seniors may contend that benefit  amounts had been eroded by                                                                    
inflation.  He  understood  leaving   the  benefits  at  the                                                                    
current  level  given  the   state's  fiscal  situation.  He                                                                    
believed a six-year extension was appropriate.                                                                                  
Co-Chair  Stoltze  noted   that  Representative  Hawker  had                                                                    
sponsored  the  initial  bill related  to  the  program  and                                                                    
wondered if  the Senate  had increased  the benefits  in the                                                                    
past. Representative Hawker replied  that he had offered the                                                                    
bill  in 2007  and did  not  believe the  benefits had  been                                                                    
changed since its introduction.                                                                                                 
1:47:48 PM                                                                                                                    
Representative  Wilson  asked  whether a  program  recipient                                                                    
would continue to  receive the benefits after  moving into a                                                                    
state-run Pioneer Home.  She wanted to ensure  the state was                                                                    
not paying the benefits to a  state agency. She was in favor                                                                    
of the program.                                                                                                                 
Representative Hawker  pointed to a Senior  Benefits Program                                                                    
Fact  Sheet  dated  January  31, 2014  (copy  on  file).  He                                                                    
relayed that  payments were not available  to seniors living                                                                    
in prison,  a nursing  home, an  Alaska Pioneer  or Veterans                                                                    
Home,  or in  a  public or  private  institution for  mental                                                                    
Representative Wilson  reiterated her prior comment  and was                                                                    
in support of funds going to program recipients.                                                                                
1:49:11 PM                                                                                                                    
Representative   Costello   spoke    in   support   of   the                                                                    
legislation.  She recalled  when  a prior  iteration of  the                                                                    
program had  been implemented after the  longevity bonus had                                                                    
been discontinued  due to budgetary reasons.  She pointed to                                                                    
page  2  of the  Senior  Benefits  Program Fact  Sheet;  the                                                                    
number of  beneficiaries was 4,000  in Anchorage  and 10,954                                                                    
statewide. She referred to the  annual gross income limit of                                                                    
$10,935 for the $250 benefit.  She believed the numbers were                                                                    
amazing and that the program  was very important. She opined                                                                    
that  because  the  state  was   in  a  difficult  budgetary                                                                    
situation  it was  important to  send the  message that  the                                                                    
state was  committed to  the senior  population. She  was in                                                                    
favor  of extending  the program  out into  the time  period                                                                    
when  state revenues  would be  more  challenged. She  spoke                                                                    
about  an  83-year-old  family  friend.  She  believed  that                                                                    
seniors  worried   about  the  responsibilities   they  were                                                                    
placing on younger generations.                                                                                                 
Representative   Guttenberg    imagined   that    when   the                                                                    
legislature debated  the continuation of the  program during                                                                    
the  budget-crunch  time  that  it  would  be  difficult  to                                                                    
discontinue it.  He believed the program  represented one of                                                                    
the backstops the state had  for Alaskans. He was sorry when                                                                    
the longevity bonus had been eliminated.                                                                                        
1:53:03 PM                                                                                                                    
Representative Edgmon  thanked the sponsor for  offering the                                                                    
bill. He  looked at the  three monthly benefit  tiers [shown                                                                    
on the Senior Benefits Program  Fact Sheet] and guessed that                                                                    
elderly rural  beneficiaries fell  under the  higher monthly                                                                    
payment [$250]. He  surmised that similar to  the Low Income                                                                    
Heating  Assistance Program  that the  per capita  amount of                                                                    
the benefits was slightly higher  going to the bush. He knew                                                                    
that  the $250  went  a  long way  for  many  elders in  his                                                                    
district. He appreciated the bill.                                                                                              
Representative Hawker  respected and understood  the earlier                                                                    
point  raised  by  Co-Chair  Austerman.   He  spoke  to  the                                                                    
uncertainty  of the  current budget  and  about the  optimal                                                                    
fiscal times  of the  past ten  years. He  acknowledged that                                                                    
the state was  entering a period of  fiscal uncertainty; but                                                                    
he  believed  the  program  should  be  extended  six  years                                                                    
instead of  three because it  was a matter  of communicating                                                                    
the  legislature's priority.  The  program  amounted to  $20                                                                    
million.  He stressed  that extending  the  program for  six                                                                    
years provided extra assurance to  individuals that it would                                                                    
not be competing  for funds with other  programs during that                                                                    
period  of  time. He  questioned  whether  it was  a  higher                                                                    
priority to provide  a stipend for seniors or  a stipend for                                                                    
film subsidies; he landed on  the side of seniors. He wanted                                                                    
the legislature  to make the greatest  possible statement of                                                                    
policy that  it supported the  small stipend for  the lowest                                                                    
income segment of the state's senior population.                                                                                
1:57:33 PM                                                                                                                    
Representative  Guttenberg thanked  the  department for  the                                                                    
helpfulness of the Senior Benefits Program Fact Sheet.                                                                          
Co-Chair Austerman  believed he  and the sponsor  shared the                                                                    
same  goal, but  had different  ideas about  the appropriate                                                                    
timeline. He  discussed the governor's proposed  cuts of $30                                                                    
million to  agency operations. He  stressed that  the senior                                                                    
benefits program  was not  on the  chopping block.  He could                                                                    
see  three years  into the  future but  it was  difficult to                                                                    
know how  the state's  fiscal environment would  look beyond                                                                    
that   time.  He   believed  a   three-year  extension   was                                                                    
Representative  Wilson appreciated  the  bill, but  believed                                                                    
seniors  recognized  that  the   state  was  experiencing  a                                                                    
challenging  budgetary  environment.  She  did  not  believe                                                                    
reducing  the  sunset  to   three  years  communicated  that                                                                    
seniors  were  not  a  top   priority.  She  mentioned  K-12                                                                    
education as another top priority.  She believed it was hard                                                                    
to  decide between  extending the  sunset for  three or  six                                                                    
years;  however, she  believed  a  three-year extension  was                                                                    
appropriate given the current fiscal climate.                                                                                   
Representative Edgmon remarked that  there was more than one                                                                    
way to look  at the issue. He pointed out  that seniors were                                                                    
the  fastest growing  sector in  the state's  population. He                                                                    
spoke to  their value to the  state and to the  value of the                                                                    
program.  He believed  a six-year  extension would  keep the                                                                    
program off of the  chopping block. He supported maintaining                                                                    
the current bill language.                                                                                                      
2:01:29 PM                                                                                                                    
Representative  Hawker explained  that  three years  earlier                                                                    
the program  had been  extended for  three years.  He shared                                                                    
that the amount of senior  benefits had not been changed. He                                                                    
detailed that  the Senate had  added four sections  that had                                                                    
increased  the  personal  needs  allowance  for  individuals                                                                    
residing  in long-term  care  facilities (including  nursing                                                                    
homes, Pioneer Homes, and Veteran  Homes) to $200 per month.                                                                    
The  residents  had  been ineligible  for  senior  benefits;                                                                    
therefore, the change provided them  with the $200 per month                                                                    
Representative Munoz referenced  the Senior Benefits Program                                                                    
Fact Sheet. She wondered  how the provision determining that                                                                    
program  eligibility did  not look  at  asset ownership  had                                                                    
been  established. Representative  Hawker answered  that the                                                                    
decision  had   been  a  policy   call  when   the  original                                                                    
legislation had  passed. He  explained that  the legislature                                                                    
had decided to format the  program as a current income-based                                                                    
program.  The legislature  had determined  that  it did  not                                                                    
want savings to count against  the program. He detailed that                                                                    
factoring  in assets  involved many  judgment calls  that he                                                                    
had  wanted   to  avoid   (e.g.  house   size,  geographical                                                                    
location, and  other). He added  that the assumption  that a                                                                    
person with  substantial liquid  monetary assets  would have                                                                    
substantial  liquid   income  had  been   contemplated  when                                                                    
deciding to make the program income-based.                                                                                      
2:05:01 PM                                                                                                                    
Representative  Costello   asked  what  percentage   of  the                                                                    
recipients   were  WWII   veterans.  Representative   Hawker                                                                    
responded that  he did not  know. He thought  the department                                                                    
may  have  detail  on  the question.  He  relayed  that  the                                                                    
average age  of a recipient was  75 and the maximum  age was                                                                    
103.  The sector  included the  age group  that was  passing                                                                    
away the quickest.                                                                                                              
Co-Chair  Stoltze  made  a personal  comment  related  to  a                                                                    
family member.                                                                                                                  
Representative Costello  shared that  her father  had served                                                                    
in WWII.  She surmised that  seniors who had served  in WWII                                                                    
represented  around the  median age  of seniors  benefitting                                                                    
from the program.                                                                                                               
2:06:43 PM                                                                                                                    
Representative Hawker  spoke to  a statistical  analysis the                                                                    
department  had prepared  at his  request (he  would provide                                                                    
the document  to the committee).  He shared that  49 percent                                                                    
of  the beneficiaries  were 80  years  of age  or older;  35                                                                    
percent were under  75; and individuals between  the ages of                                                                    
75  and  79  accounted  for  approximately  25  percent.  He                                                                    
surmised that  the most  common age was  between 75  and 79;                                                                    
however, the program was heavily  skewed to individuals over                                                                    
the age of 80.                                                                                                                  
Co-Chair Stoltze CLOSED public testimony.                                                                                       
Co-Chair   Austerman  appreciated   that  the   sponsor  had                                                                    
introduced the bill  in 2007. He MOVED to AMEND  the bill to                                                                    
reduce the  extension from  six years  down to  three years;                                                                    
the date 2021 would be replaced with 2018.                                                                                      
Representative Gara OBJECTED.                                                                                                   
Co-Chair Stoltze deferred to the co-chair on the issue.                                                                         
A roll call vote was taken on the motion.                                                                                       
IN FAVOR: Thompson, Wilson, Stoltze, Austerman                                                                                  
OPPOSED: Guttenberg, Holmes, Munoz, Costello, Edgmon, Gara                                                                      
The MOTION FAILED (4/6).                                                                                                        
Representative Costello  discussed the fiscal note  from the                                                                    
Department of Health and Social  Services. The note included                                                                    
six  full-time   positions  and  had  a   fiscal  impact  of                                                                    
$23,090,500 in FY  15, $25,018,700 in FY  16, $25,700,400 in                                                                    
FY  17, $26,402,400  in FY  18,  $27,125,500 in  FY 19,  and                                                                    
$27,870,400 in FY 20.                                                                                                           
Representative  Hawker communicated  that the  six positions                                                                    
were a  continuance of the  personnel currently  employed by                                                                    
the program.  He noted that  the numbers in the  fiscal note                                                                    
were an estimate by the agency.                                                                                                 
Representative  Costello  moved  the MOVED  to  REPORT  CSHB                                                                    
263(HSS)  out of  committee with  individual recommendations                                                                    
and the accompanying fiscal notes.                                                                                              
There being NO  OBJECTION CSHB 263(HSS) was  REPORTED out of                                                                    
committee  with  a "do  pass"  recommendation  and with  one                                                                    
previously published fiscal impact note: FN1 (HSS).                                                                             
Representative Hawker appreciated  the committee's attention                                                                    
to the bill.  He observed that the issue  raised by Co-Chair                                                                    
Austerman was  legitimate and would  be a  concern addressed                                                                    
by the legislature on many issues.                                                                                              
2:13:44 PM                                                                                                                    
AT EASE                                                                                                                         
2:17:00 PM                                                                                                                    

Document Name Date/Time Subjects
HB 211- Sponsor Statement.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
HB 211 Supporting Document-Governor's Council on Disabilities and Special Education Summary of HB 211.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
HB 211 Supporting Document-SILC Letter of Support.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
HB 211-Sectional Analysis.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
HB 211 Supporting document-State Employment Leadership Network Report.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
HB 211-Supporting Document NACDD Report.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
ACoA Support HB 263.pdf HFIN 2/18/2014 1:30:00 PM
HB 263
HB 263 Combined Letters of Support.pdf HFIN 2/18/2014 1:30:00 PM
HB 263
HB 263 SBP Fact Sheet (01-31-14).pdf HFIN 2/18/2014 1:30:00 PM
HB 263
HB 263 Sponsor Statement.pdf HFIN 2/18/2014 1:30:00 PM
HB 263
CSHB211 Supporting Document-AHFC Letter.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
HB 211 Amendment #1 Stoltze by Request.pdf HFIN 2/18/2014 1:30:00 PM
HB 211
Changes to HB 263 HHSS.pdf HFIN 2/18/2014 1:30:00 PM
HB 263
HB263(2014) letter of support.pdf HFIN 2/18/2014 1:30:00 PM
HB 263