Legislature(1993 - 1994)
02/15/1994 08:00 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 368 - REAPPLICATION PERIOD FOR 1993 PF DIVIDEND Number 433 CHAIR VEZEY opened HB 368 for discussion. Number 441 REPRESENTATIVE GENE THERRIAULT, SPONSOR OF HB 368, referred to his sponsor statement. "HB 368 is designed to address a problem that has come to light regarding 1993 Permanent Fund Dividend applications that were lost by the U.S. Postal Service. In October of 1993 my office was contacted by numerous constituents regarding loss of their Permanent Fund Dividend (PFD) applications. The PFD Division did not have record of receiving their applications, however the individuals noted mailing their applications early in January through the North Pole Post Office. After looking into this situation, my staff learned that the Postal Service had received calls in January 1993 from customers whose payments had not reached creditors. These complaints led to a U.S. Postal Inspection Service investigation which determined that an apparent loss of mail took place on January 8, 9, or 11, 1993, affecting residents in the North Pole area. A letter documenting the loss was supplied to customers for the notification of creditors. (on file) "HB 368 would open a narrow window for PFD applicants by extending the reapplication period for the 1993 dividend year from September 1, 1993 to September 1, 1994. The applicant would be required to provide a sworn statement that the application was originally mailed in the postal area during the time mail from that area was lost. A sworn statement from another individual who witnessed the mailing or signed the residency verification of the original application before the 1993 deadline, and documentation from the U.S. Postal Service acknowledging the loss of mail entered into the mail stream during the 1993 PFD application period. "The PFD division currently allows an applicant who timely filed an application that was not received by the PFD Division to reapply before September 1 of the dividend year (15 AAC 23.103(h)). The Division has traditionally allowed reapplication, however 1993 was the first year the deadline was established. Although PFD applicants receive batch cards that verify receipt of their application, a number of individuals did not expect to receive a batch card last year due to the new direct deposit method of payment and therefore did not get notice of a problem until in was too late. "An extension to this deadline is needed for the 1993 reapplication period due to this loss of mail in the North Pole Post Office and the new deadline for reapplying for the dividend. My staff and I have worked with the PFD Division within the Department of Revenue to draft the language of HB 368 to solve this problem without throwing the reapplication period wide open." HB 368 has a zero fiscal note. Because of the narrow window HB 368 provides, the PFD division has stated a neutral opinion of the bill. CHAIR VEZEY asked why there is a zero fiscal note when an estimated 30 PFDs would be issued under HB 368. Number 489 REPRESENTATIVE THERRIAULT corrected the amount of PFDs issued would be approximately 50-60. The PFD Division sets aside an amount of money for people going through the appeal process. All of these people have already filed in the appeal process, but without HB 368, they will likely be denied. Number 500 TOM WILLIAMS, DIRECTOR, PERMANENT FUND DIVISION, DEPARTMENT OF REVENUE, stated because of the narrow construction of HB 368, his department has a neutral position. Because the people have already filed in the appeal process, the Division does not expect a significant impact on the administration, therefore there is a zero fiscal note. Number 510 CHAIR VEZEY questioned if the individuals had used the certified mail service and still failed to meet the reapplication deadline, would they still be determined ineligible. Number 515 MR. WILLIAMS reiterated the reapplication deadline is September 1 and they will have until that date to provide the required evidence of mailing. The September 1 deadline is set so the Division can calculate the number of eligible applicants by the statutory deadline of October 1. He encouraged people to locate their batch receipt cards. Number 522 CHAIR VEZEY commented HB 368 is incumbent upon all persons applying for a PFD to verify prior to September 1 that their application has been received. REPRESENTATIVE KOTT inquired if there had been any past legislative attempts to address a small group of people for PFD reapplication. Number 530 MR. WILLIAMS was unaware of any legislation as narrow as HB 328. Early in the PFD program, there was a broad based reapplication period which caused a plethora of problems. Number 536 REPRESENTATIVE THERRIAULT commented the early problems were due to notification problems in rural Alaska. Since then, the program has not been "opened up." The U.S. Postal Service has only documented one loss of mail in the entire state during the application period. Proof of loss of mail is required for HB 368. Individuals in North Pole and one individual visiting from Anchorage will be primarily affected by HB 368. Number 548 REPRESENTATIVE KOTT asked if the reapplication REPRESENTATIVE THERRIAULT referred to was conducted through a statute or by regulation. Number 550 REPRESENTATIVE THERRIAULT believed it was statutory. MR. WILLIAMS confirmed it was statutory. Number 553 REPRESENTATIVE KOTT inquired if HB 368 was not passed, would there be discretion for those individuals involved in the appeal process. Number 558 MR. WILLIAMS responded as current statute stands, the 50-60 people would not be eligible for a dividend. HB 368 would not be codified, it would be a temporary statute. Number 562 CHAIR VEZEY clarified HB 368, if passed, would become part of the session laws of Alaska. (REPRESENTATIVE OLBERG left the meeting at 8:35 a.m.) Number 567 REPRESENTATIVE KOTT was concerned with the amount of time taken to discuss HB 368 and wondered if the Department of Revenue could just take care of it. He felt, however, if HB 368 was the only way these individuals could be dealt with fairly, then he understood. CHAIR VEZEY clarified under current statute these individuals could not receive a dividend. MR. WILLIAMS confirmed CHAIR VEZEY. REPRESENTATIVE KOTT saw HB 368 as the only way to resolve the unjust situation, therefore, he moved to pass HB 368 from committee with unanimous consent. Number 583 CHAIR VEZEY commented HB 368 deals with a "gray area" mitigated by a number of circumstances. The five and a half month reapplication period is a reasonable time frame. Hearing no further comments, CHAIR VEZEY recognized the motion by REPRESENTATIVE KOTT. The committee secretary called the roll and HB 368 passed House State Affairs Committee with a unanimous "do pass" recommendation.
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