Legislature(2003 - 2004)
04/15/2003 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 248-SALARY OF CHIEF PROCUREMENT OFFICER Number 1088 CHAIR WEYHRAUCH announced that the next order of business was HOUSE BILL NO. 248, "An Act relating to the annual salary of the chief procurement officer; and providing for an effective date." Number 1125 DAN SPENCER, Director, Division of Administrative Services, Department of Administration (DOA), said the proposed bill is a simple one that would increase the salary of the chief procurement officer by "one range." He noted that the reason [for the increase], as stated in a transmittal letter from [Governor Murkowski, dated April 3, 2003, included in the committee packet], is because the chief procurement officer is currently functioning as the division director. The director position is being eliminated, while either a deputy director or administrative manager position will be created. At this point in time, he said, there is a leasing and facilities manager - a position which has existed for several years - and the chief procurement officer. There will be a new administrative services manager or deputy director, depending upon classification action. MR. SPENCER explained that the proposed increase in salary by one range is to ensure that there is some separation between the two subordinates and the chief procurement officer, and to recognize the chief procurement officer's additional responsibilities in deciding the course of policy issues for the division. Number 1200 MR. SPENCER, in response to a question by Chair Weyhrauch, explained that a division director's salary is a range 26. The chief procurement officer's salary would be raised to range 24. He said he thinks the reason that the salary would be only a range 24 is that, by statute, the chief procurement officer is in the position for six years and may only be removed "for cause," which is different from a director's partially exempt position which "may be removed for just about anything." Therefore, there is a level of certainty of the employment that is enjoyed [by the chief procurement officer] that is not enjoyed by "a normal division director." MR. SPENCER, in response to a series of follow-up questions by Chair Weyhrauch, said Vern Jones presently fills the chief procurement officer position. He stated his belief that Mr. Jones was just reappointed and, therefore, is in the first of a six-year term. Number 1340 REPRESENTATIVE HOLM asked how much [a range 24 pays]. MR. SPENCER replied that he did not bring the salary amount with him to the meeting. Number 1348 REPRESENTATIVE BERKOWITZ referred to the two fiscal notes. He said he finds it incredibly problematic that increased salary costs aren't available in current appropriations. He said, "If there's an increased salary cost, I think it's important to note what it is." REPRESENTATIVE BERKOWITZ said moving a bill through the legislature has a cost itself, which, he recalled, is approximately $5,000 to $10,000 per bill. He said it seems horribly inefficient to be doing targeted salary increases for individual members of the administration. He asked, "Is this going to be some kind of consistent policy?" He suggested, "Or maybe we can get one sort of omnibus bill effecting members of the administration, so we will have them all in one fell swoop and, perhaps, be able to save enough to pay the people the extra money." MR. SPENCER answered that he had no idea whether there would be an omnibus bill. He explained the reason that there is no cost in [the fiscal note] is because a range 26 F position is being eliminated to create a range 23 E position. With all the previously stated position changes, the result will be "a several thousand dollar savings over the course of the year." Number 1423 REPRESENTATIVE BERKOWITZ opined that a fiscal note, in order to be fully transparent, ought to contain that information. He said the fiscal note [before the committee] only lists zeros, with [the following] narrative: "Funding for the increased salary cost is available in the current appropriation." Representative Berkowitz continued as follows: I realize this isn't your responsibility, but one of the few methods I have of communicating with the administration is when members of the administration come before committees on which I sit. And, this is a consistent pattern and a troubling pattern. Zero fiscal notes mean that there is no cost, not that there's a change in costs or that one item goes up and another item goes down; it means there is no cost. And I think that the fiscal note ought to fairly reflect what's going on, and then let us make a determination. This is shell games with money. REPRESENTATIVE BERKOWITZ told Mr. Spencer that he did not need to respond to that, because he shouldn't bear the brunt of concern. Number 1489 CHAIR WEYHRAUCH asked how many specialized employment categories there are "like this." He asked if the legislature could conceivably be "seeing" 20 to 30 of these bills. MR. SPENCER answered that he does not know. He recalled the following statutory positions that may only be removed "for cause": the public defender in DOA, three Alaska Oil & Gas Conservation commissioners, and the Administrative Law Judge. Number 1552 REPRESENTATIVE SEATON said he concurred with some of Representative Berkowitz's concerns [regarding the fiscal note]. He said a zero fiscal note seems to indicate that there's no change, while the cover letter states that "we're basically saving money," which is a change that should make the fiscal note a negative one. He said he would like to see the fiscal notes addressed and changed [to reflect] the costs that would be seen. Number 1582 REPRESENTATIVE HOLM said one of the [considerations] is different step grades [within each range]. MR. SPENCER clarified that a person gets paid depending on how long he/she is in the system. REPRESENTATIVE HOLM said the impact would change, based upon how long the person has been [an employee]. MR. SPENCER responded that it would change slightly. REPRESENTATIVE HOLM concluded, "So, I don't know that you could come up with a direct single-dollar figure." REPRESENTATIVE SEATON noted the change in salary from a range 23 to a range 24. REPRESENTATIVE HOLM pointed out that "it changes on the sub grade." He asked how many sub grades there are. CHAIR WEYHRAUCH answered, "A through F." Number 1653 REPRESENTATIVE SEATON opined that [Representative Holm] is talking about what the particular salary of a person is, whereas, the purpose of [HB 248] is to change "the entire salary range for that position." He said he reads the bill as eliminating a range 26 position and adding a range 24 position. He said there has to be a fiscal impact [to reflect] those changes. CHAIR WEYHRAUCH said he thinks what Representative Holm [is saying] is "what is the range per step of this employee, too," which may have an effect on the fiscal note. REPRESENTATIVE HOLM said, "That is correct." Number 1725 REPRESENTATIVE BERKOWITZ asked what the difference is between a [range] 23 A and 24 A. Number 1730 MR. SPENCER responded that he does have the information; however, he asked to address the issue of the fiscal note first. Fiscal notes have been done several different ways in the past. One way, he noted, is a zero fiscal note, like the one before the committee. Another way is an "information fiscal note," where information is provided, while pointing out that no additional appropriation is needed. He said, "We would be happy to amend the fiscal note to provide that information; we're not trying to hide any information here." He offered to have that ready for the committee in the afternoon. CHAIR WEYHRAUCH said he thinks the committee needs a revised fiscal note, [or at least the department] needs to look at it again and, if it doesn't revise it, tell the committee why it is "sticking with it." MR. SPENCER said he thought what [the department] would do is provide the numbers in an information fiscal note, including [a message to say] that no appropriation is necessary. Number 1832 MR. SPENCER, in response to a question by Representative Lynn, told the committee that the bi-weekly salaries are as follows: The chief procurement officer, right now, is at a range 23 K, which would be $3,307.50 ... and ... would go up to $3,535.00. CHAIR WEYHRAUCH referred to the salary schedule in AS 39.27.011. MR. SPENCER reiterated that the chief procure officer is currently at a step K, which is a "longevity step." In response to a request for clarification by Chair Weyhrauch, he said, "There's a methodology in the statute that shows how you compute the additional steps." He offered to provide that to the committee as part of the revised fiscal note. He noted that the schedule before the committee "takes you from step A through F." He explained that those are annual merit increases [rewarded for] satisfactory performance and increased value [of the employee] to the state. Beyond step F, he said, are the longevity steps, which are addressed in the statute. Basically, employees stay at step F for two years, then go to step J. He noted, "This is in the partially-exempt schedule, because some of the bargaining units have different arrangements." He said employees stay at step J for four years, then four years at step K. He said he doesn't know "if it ever caps." Number 1907 REPRESENTATIVE BERKOWITZ said he knows that the administration has had a difficult time filling a number of positions, because the argument is that it's hard getting pay ranges that are high enough. He asked if moving from a [range] 26 to a [range] 24 wouldn't be "moving in the opposite direction," and what a 26 would be making. Number 1940 MR. SPENCER answered, "The previous director was making one dollar, every two weeks, less than the chief procurement officer would be under this." He explained that the savings would be because of what is being done with the position. He reiterated the reason "that this works in this particular situation," is because the chief procurement officer is a statutorily designated position that can only be removed for cause. Number 2007 REPRESENTATIVE BERKOWITZ suggested that there is an internal problem within the administration. He said, "This all could be obviated if we just had the chief procurement officer ... become the ... director of the division." He mentioned there would still [be] a promotion, and added, "And then you wouldn't have the cause issue." He asked if that offer had been made. MR. SPENCER said not that he is aware of. He said [the department] would still need a chief procurement officer. In response to a question by Representative Berkowitz, he explained that the position cannot be left vacant because it is the head of all the procurement functions in the state and sets policy for procurement, as well as plays a role in appeals processes, for example. Number 2070 REPRESENTATIVE LYNN asked if the previously mentioned "longevity" is part of what the governor wants to eliminate. MR. SPENCER answered no. Number 2085 CHAIR WEYHRAUCH announced that HB 248 was heard and held.
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