Legislature(2003 - 2004)
02/18/2003 08:02 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 14-PERMANENT FUND ALLOWABLE ABSENCES CHAIR WEYHRAUCH announced that the next order of business was HOUSE BILL NO. 14, "An Act relating to an absence from the state while providing care for a terminally ill grandparent for purposes of determining eligibility for a permanent fund dividend; and providing for an effective date." Number 1708 REPRESENTATIVE HUGH FATE, Alaska State Legislature, as the sponsor of HB 14, explained that for years permanent fund dividend (PFD) exemptions have been granted for those who attend to terminally ill members of the family. However, that language failed to include grandparents. Therefore, the definition [for eligibility] should be amended such that it includes grandparents. REPRESENTATIVE BERKOWITZ inquired as to the number of individuals that would be impacted by this. REPRESENTATIVE FATE answered that he had no idea. In further response to Representative Berkowitz, Representative Fate clarified that he didn't believe this legislation would include step grandparents, although that could be [changed]. REPRESENTATIVE BERKOWITZ expressed concern with not specifying retroactivity. In response to Chair Weyhrauch, Representative Berkowitz explained that he is addressing a procedural question because the preferred course is for legislation to move through the other body unchanged so that the legislation won't have to return to the House for adoption of changes from the other body. REPRESENTATIVE BERKOWITZ returned to the issue of step grandparents and suggested moving to a broader definition of family rather than specifying [to which family members this would apply]. Number 1972 CHAIR WEYHRAUCH pointed out that an individual could have a terminal illness and years could pass before the individual dies from that illness. He posed a situation in which an individual who leaves the state to care for a grandparent with a terminal illness ends up being gone for five years. He asked if the relative would need to obtain a note from the grandparent's physician substantiating that the relative is caring for the terminally ill grandparent. He asked how extended illnesses would be dealt with. REPRESENTATIVE FATE said it would be up to the physician because terminal illness and terminal disease are juxtaposed. He explained that there are chronic diseases that are terminal and may last over a 10-year period. The physician treats such a chronic disease and thus it isn't immediately terminal because there is a time line. CHAIR WEYHRAUCH asked whether the Department of Revenue has adopted any regulations for paragraph (7). REPRESENTATIVE FATE answered that he did not know. Number 2148 CHAIR WEYHRAUCH asked if Representative Fate intends for "terminally ill" to be considered a few months or less than a year. REPRESENTATIVE FATE clarified that a terminal illness of a grandparent is no different than that of any other member of the family. With regard to the step grandparents, Representative Fate said that perhaps the language should be broadened [to include step grandparents]. Number 2261 REPRESENTATIVE SEATON asked if an entire family would remain eligible for the PFD in the situation in which an entire family moves out of state to care for a terminally ill grandparent. REPRESENTATIVE FATE emphasized that including grandparents wouldn't change the regulations, which cover who can care for the terminally ill individual. This legislation merely expands that list to allow an individual to care for a terminally ill grandparent. REPRESENTATIVE SEATON inquired as to the current coverage under the regulations. REPRESENTATIVE BERKOWITZ said that he wants a broader definition, because under Representative Seaton's hypothetical situation children would be taking care of great grandparents and those [children] wouldn't be covered [eligible for the PFD]. This addition still wouldn't cover situations in which children take care of terminally ill great aunts or foster parents. Therefore, Representative Berkowitz expressed the need to take care when defining "family." If direct sanguinity is used in defining "family," then lots of people could be left out who should be included. Number 1460 REPRESENTATIVE GRUENBERG pointed out that, often, grandparents end up becoming the primary custodian of grandchildren. He posed a situation in which a grandchild with a terminal illness may result in a grandparent moving out of state long term to care for the terminally ill grandchild. REPRESENTATIVE FATE informed the committee that AS 43.23.008 in part specifies that "an otherwise eligible individual" [would remain qualified if the individual was absent]. He pointed out that the Act already specifies a time limitation of 220 days [for an absence]. REPRESENTATIVE SEATON referred to page 2 [line 14] and asked if the 220-day limitation only applied to settling the estate. REPRESENTATIVE FATE said that the 220-day limitation only refers to the settling of the estate. REPRESENTATIVE DAHLSTROM asked if stepparents are included in the legislation as it stands. REPRESENTATIVE FATE replied no. CHAIR WEYHRAUCH specified that HB 14 would only add grandparents. REPRESENTATIVE BERKOWITZ inquired as to why paragraph (14) wouldn't apply. He related that some of his constituents regularly complain that they aren't given exemptions for being stationed in the Antarctic. Number 2689 PAUL DICK, Acting Director, Permanent Fund Dividend Division, Department of Revenue, explained that before 1988, the department defined absences by regulation. In 1988 the legislature defined what absences were allowable under statute for purposes of maintaining the PFD. Therefore, Mr. Dick characterized this as a legislative prerogative. He noted that this statute was amended a few years ago. REPRESENTATIVE BERKOWITZ surmised that there is no discretion under paragraph (14), because the legislature circumscribed that discretion elsewhere. MR. DICK clarified that it has been left to the legislature to define the terms of the absences and the terms the additional [reasons] for which individuals can be absent. In further response, Mr. Dick specified that those terms are under AS 43.23.008. REPRESENTATIVE BERKOWITZ remarked that paragraph (14) is a catchall because it says, "(14) for any reason consistent with the individual's intent to remain a state resident ...." The aforementioned language seems to provide the division some discretion in considering someone who might not fit under the tight [provisions in statute]. He said that the legislature can't be expected to enumerate every possible exception, and therefore those enforcing the rules should have the discretion necessary in this area. "If [paragraph] (14) is being ignored, that's a problem," he said. MR. DICK pointed out that paragraph (14) concludes, "provided that the absence or cumulative absences do not exceed" 180 days. Those that are absent for [no more than] 180 days and maintain residency and intend to [continue to] do so receive a dividend. Mr. Dick explained that the allowable absences are for absences over 180 days, and those provisions are defined by the legislature. Mr. Dick informed the committee that last year the division had 140 people fall under this terminally ill category. Under the assumption of 200 [people falling under that category], the cost would be a $.52 differential. REPRESENTATIVE SEATON asked if some people have applied for a PFD while caring for a grandparent [and absent for more than 180 days] and were turned down. MR. DICK said that he didn't have that information in front of him. REPRESENTATIVE SEATON inquired as to the definition of "care". He also inquired as to whether an entire family could [be absent from the state] to care for a grandparent or parent [and still receive a PFD]. MR. DICK said that it couldn't be an entire family under the current statutes because the child would [be] caring for a grandparent, which isn't covered currently. REPRESENTATIVE SEATON surmised then that the effect of this legislation is to allow the entire family to [be absent from the state to care for someone] and qualify for the PFD, because passage of this legislation would allow individuals to care for parents and grandparents. MR. DICK said he believes that the aforementioned would be addressed in regulation. However, he related his belief that an individual would take care of a grandparent rather than an entire family. Therefore, he indicated that the committee may want to specify that in the statute. MR. DICK, in response to the definition of "care", explained that when a person claims this absence on the PFD application, the person is required to submit a form ...[tape change]. TAPE 03-10, SIDE B REPRESENTATIVE FATE pointed out that Section 1(a) of this legislation refers to "an otherwise eligible individual who is absent from the state during the qualifying year". He emphasized that the language refers to an "individual" not "individuals", which he thought would be defined by the grandparent. Therefore, Representative Fate wasn't concerned with a family [being absent from the state to care for someone]. Number 2961 REPRESENTATIVE GRUENBERG turned to the second paragraph of the fiscal analysis, which says, "The Permanent Fund Dividend Division generally accepts a doctor's statement in determining if the relative is terminally ill ...." He indicated he thought that answers Chair Weyhrauch's earlier question with regard to how to determine an individual is terminally ill. The amendment to this statute focuses on the terminally ill individual, not the individual going out-of-state to provide care, he pointed out. He surmised that this legislation would include grandchildren as other eligible individuals. To that end, Representative Gruenberg noted that in many cases, adults who go out of state to provide care to a terminally ill [relative] take their minor children with them. Therefore, the problem would be that the caregiver would be covered, but the children would not, and thus the adult caregiver would receive his/her PFD but the children would not. He asked if the aforementioned would be correct. MR. DICK replied yes and confirmed that the statute speaks only to the caregiver. Mr. Dick clarified that the only people covered under the current statute and who would continue to be covered would be the caregiver not the caregiver's dependents. REPRESENTATIVE FATE interjected that he didn't intend to change the law but only to expand the statute to include the individual who provides care for their terminally ill grandparent. Number 2764 REPRESENTATIVE BERKOWITZ pointed out that the statute says "providing care" and sometimes the best care comes from children. Representative Berkowitz related his belief that the statute is sufficiently vague so as to incorporate the notion that care can come in many different forms. REPRESENTATIVE FATE remarked, "I think in this instance you may be right, but I think we're talking about medical care." REPRESENTATIVE BERKOWITZ interjected that the statute doesn't refer to medical care. REPRESENTATIVE FATE acknowledged that the presence of child may boost moral, however that's not usually considered care. REPRESENTATIVE BERKOWITZ asked if there is a definition of care that he could review. REPRESENTATIVE FATE indicated that if one were to approach the physician, the physician would provide a definition of care. REPRESENTATIVE BERKOWITZ pointed out that unless that definition of care is included in the statutes, it is immaterial. Number 2648 CHAIR WEYHRAUCH related his understanding that Representative Fate's intent is simply to add the words "or grandparent". REPRESENTATIVE FATE agreed and specified that he didn't become involved in this to modify the entire Act. CHAIR WEYHRAUCH said that, to him, it seems that any person related in any way would be eligible for a PFD if that individual can provide any reason consistent with their intent to remain a state resident. He noted that the legislature could take the aforementioned discretion away and make it clear and certain, which he related is always a good thing to do. However, he said he isn't sure whether HB 14 is the vehicle. REPRESENTATIVE BERKOWITZ pointed out that the individual is limited to 180 days within a calendar year and thus the [time absent from the state for an allowable absence] could sum 360 days if the time was from June to January and January to June. He characterized that as somewhat problematic because people can't schedule their illnesses to comport with PFD eligibility. Representative Berkowitz expressed his desire to expand this [Act] to include people providing care to family members, [while recognizing] that there are all types of families of which one is direct blood lineage. Number 2571 REPRESENTATIVE GRUENBERG expressed concern with Mr. Dick's earlier answer to Representative Berkowitz regarding [paragraph] (14). He interpreted Mr. Dick's earlier answer to be that the division isn't exercising any discretion at all and not applying [paragraph (14)] at all. He asked if that is correct. MR. DICK answered that he isn't sure. REPRESENTATIVE GRUENBERG inquired as to the number of people receiving dividends under [paragraph] (14) who would've been eligible under any other [paragraph]. MR. DICK again answered that he isn't sure. He offered the following example: There are 8,200 felons and misdemeanants who aren't eligible for the PFD in another [paragraph] of the statute, although those individuals were probably out-of-state for less than 180 days. Mr. Dick specified that the intent to remain and residency are always reviewed. Therefore, those who are out-of-state for less than 180 days but move out-of-state toward the end of the year aren't eligible for a PFD. REPRESENTATIVE GRUENBERG asked if felons and misdemeanants have been awarded a PFD under [paragraph] (14). MR. DICK reiterated that felons and misdemeanants aren't eligible for a PFD under another statute. REPRESENTATIVE GRUENBERG asked, "Have you awarded them dividends under [paragraph] (14)?" MR. DICK replied no. REPRESENTATIVE GRUENBERG asked if the division has awarded anyone a dividend under [paragraph] (14). MR. DICK answered yes and informed the committee that the division has given dividends to persons outside the state for less than 180 days, so long as those individuals are residents. REPRESENTATIVE GRUENBERG asked, "Have you given anybody a dividend under [paragraph] (14) who would not have been eligible under any other [paragraph], that you can recall?" MR. DICK explained that if an individual wasn't eligible under another [paragraph], then the division would not have given the individual the dividend. REPRESENTATIVE GRUENBERG interjected, "Then the answer to my question is no." MR. DICK answered that would be correct. CHAIR WEYHRAUCH asked if military personnel would be eligible under [paragraph (14)]. REPRESENTATIVE GRUENBERG pointed out that the eligibility of military personnel is addressed under another [paragraph]. Number 2405 REPRESENTATIVE SEATON related his understanding that individuals who leave the state for less than 180 days would be eligible for the PFD under [paragraph] (14). MR. DICK answered that is correct so long as the individual maintains residency and doesn't take steps while out-of-state to break residency. Mr. Dick informed the committee that there have been individuals who have traveled out-of-state and taken a job out-of-state. However, the individual ultimately decided that he/she didn't want to stay and thus he/she returned to Alaska. Those individuals broke residency, weren't residents for the entire qualifying year, and thus were denied the PFD. REPRESENTATIVE BERKOWITZ inquired as to the number of individuals who have been denied a dividend and applied under [paragraph] (14). MR. DICK related his understanding that the question is attempting to address those persons who aren't eligible under another section of the statute. REPRESENTATIVE BERKOWITZ clarified that he wants to understand if there is a catchall provision allowing the department discretion to award dividends when situations don't specifically fit into one of the specified exceptions under AS 43.23.008. MR. DICK replied no, the division follows the statutes very strictly. Number 2354 REPRESENTATIVE BERKOWITZ noted that there is a group of people who do not receive their dividend; many of those people initiate an appeal. Those appeals have to be done under the subsection of the law, he said. He requested information as to the number of those appeals that were launched under [paragraph] (14). Of those appeals launched under [paragraph] (14), how many were granted, he asked. MR. DICK corrected his earlier statement regarding the children of those who travel out-of-state to provide care to the sick relative. He stated that under [paragraph] (13) those children would be covered. CHAIR WEYHRAUCH commented that this legislation is interesting because it raises tangential issues which may give rise to larger omnibus legislation addressing many of the aforementioned concerns. However, he related that he isn't sure whether HB 14 is the vehicle for those. He said he believes the immediate need is to address [the inclusion] of grandparents and thus he noted his desire to take action on this [legislation]. He offered to work with the members of the committee and the division to address the concerns in a larger context in another piece of legislation. REPRESENTATIVE BERKOWITZ pointed out that the proposed amendment would also fit well in [paragraph] (8) of [AS 43.23.008]. Furthermore, if those issues can be addressed by a definition of "family" [and] "guardian", then [the committee] could ensure that the intent of Representative Fate's legislation is realized. The committee took an at-ease from 9:08 a.m. to 9:17 a.m. REPRESENTATIVE BERKOWITZ moved to report HB 14 out of committee with individual recommendations and the accompanying fiscal notes. REPRESENTATIVE BERKOWITZ announced that his recommendation will be to amend the legislation. He expressed the need to correct the definition of "family" in [paragraph] (7) as well as [paragraphs] (6) and (8), which seem to include parallel lists of individuals. CHAIR WEYHRAUCH asked if there was any objection to the motion. There being no objection, HB 14 was reported from the House State Affairs Standing Committee.
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