Legislature(1995 - 1996)
02/23/1995 08:05 AM STA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HSTA - 2/23/95 HB 83 - REVIEW OF FEDERALLY MANDATED PROGRAMS CHAIR JAMES stated that next on the agenda was CSHB 83. She asked if Representative Ogan was ready to present his bill. REPRESENTATIVE OGAN asked for a brief recess to prepare. Number 624 REPRESENTATIVE OGAN stated that during the last hearing of this bill, there were some concerns raised by the Office of Management and Budget, that this could be interpreted as getting too detail oriented with regards to federal mandates and could affect trivial mandates such as the requirement to have fire exits marked. He said his aide and a representative from OMB had discussed the issue and resolved it. Another concern raised by Representative Brian Porter was that the bill was conceived to be more reactive than proactive, in that it did not have provisions to try and intercede before federal mandates were finalized. He brought with him an amendment, which he was hesitant to introduce, but said he would be happy to have it discussed by the committee. He said they did have a brief presentation with visual aids that his assistant could conduct. Number 647 ALAN KINGMAN, Legislative Aide to Representative Ogan, said he was there to present a visual overview to demonstrate how the committee substitute for HB 83 would restructure the review of federal mandates in Alaska. He stated that Representative Ogan was concerned that there was some confusion as to how CSHB 83(STA) actually worked. To begin, he defined the type of mandate this bill would effect as a federal law that implements a desired federal policy by requiring state or local governments to participate in or administer a program. He said this bill requires a review of federally mandated programs. It does not review federal preemptions or laws that place limits on states or on people. He said it only addresses laws that require the state to act to implement or administer a program. Examples of these could be environmental laws, public health laws, welfare programs, and public safety programs such as the Brady Bill. These are the types of programs that CSHB 83(STA) is dealing with, not things such as building codes that a state or individual may have to comply with. MR. KINGMAN said he also wanted to address unfunded mandates, which he defined as a mandate in which a state or local entity must raise the money to pay for their required participation in this program. He reiterated though, that unfunded mandates were not the only type of mandate that this bill was dealing with. Some mandates are funded, but may not be cost-effective or efficient, suited for Alaska's conditions, or exceed constitutional authority. CSHB 83(STA), he said, is designed to be an immunization against excessive mandates. He said the current version of this bill, adopted by this committee earlier, had two separate provisions to deal with existing mandates and newly passed mandates. For existing mandates, CSHB 83(STA) would require the OMB to select one-fourth of the existing mandates for review every year. Thus, every four years, there would be an opportunity for all mandates to be reviewed. At the end of this time, there would be a different administration who may have a different perspective. They might want to conduct their own review. At this point, OMB, the Department of Law, and the implementing agency would review the mandate for these criteria: 1) Has the federal government exceeded their authority; 2) Are the requirements consistent with Alaska state policy and suitable for Alaska; 3) Are the requirements cost-effective to implement. Once the review is completed, a report is drafted, which is sent to the Governor, House and Senate Judiciary Committees, and the Legislative Budget and Audit Committee by February 1, of that year. At this point, they will review this report. For mandates that come down from Congress after the passage of this bill, the agency head will learn of the new mandate and will review it for the above mentioned criteria. They will then draft a report and send it to the Governor and House and Senate Judiciary Committees. The agency will not be allowed to implement the mandate until the Governor approves the report and gives the go ahead. The Judiciary Committees would also do their own review. The final step, for all mandates, establishes the review of the report coming from either the OMB or the implementing agency by the judiciary committees, who do their own analysis of the mandate. They would have the option to contract with a legal firm and then make their report to the Governor and the Alaska congressional delegation. Their recommendations would be of the nature of whether there is a need to seek a change in the federal mandate, possible ways to modify the program to make it more cost-effective, or if it would be advisable to legally challenge the mandate. Also, once the agency gets authorization from the Governor to implement a mandate, this bill would require them to develop the program and implement the mandate according to the financial constraints of the state at the time and weighing the costs of implementation against the long-term Alaska benefit. Mr. Kingman said this was how the bill currently functioned. The suggestion made by Representative Porter, at an earlier committee, dealt with adding a section to this bill, which would allow the state to become active with federal mandates when they still are under consideration by the U.S. Congress, before they become law. He thought it might be possible to include this in the bill, by having the Washington D.C. Office of the Governor, monitor legislation and then give the implementing state agency an early warning of a potential mandated program for that agency. At this point, the agency would conduct an early expedited review and report back to the Governor. The Governor could then make a decision as to whether Alaska should try to intervene in the legislation process. This could either be added into this bill by the proposed amendment before the committee, or might be something that should be a totally separate bill. CHAIR JAMES asked if there were any questions or comments from the committee. TAPE 95-20, SIDE B Number 200 REPRESENTATIVE WILLIS stated he still was not sure he understood the total process of this bill and wanted to know how this bill would effect existing programs such as the Davis Bacon Act. MR. KINGMAN stated he was not familiar with this act by that name and asked for some more detail. REPRESENTATIVE WILLIS said that essentially, when a contractor does work on a federal project, they must pay workers the prevailing union wage. MR. KINGMAN was not sure that this act would be affected by CSHB 83(STA), in that it does not require by his description, the state to implement a federal program. CHAIR JAMES thought she might clarify how the Davis Bacon Act actually works, in that it does require the state to do some things. She said the state must determine what the prevailing wage actually is, but that the money in the contract is federal money and not state money. Number 258 REPRESENTATIVE OGAN said he believed this act also applied to state jobs as well and that essentially non-union contractors must pay the same rate as union contractors. Thus, the idea is that it levels the playing field between non-union and union contractors. MR. KINGMAN said that based on this description, the fact that the state is required to determine the prevailing wage, that this might be considered a mini-program and be subject to review by this bill. He reminded the committee that this bill does not make any determinations as to whether the state should participate in a federal program, it just gives us a better understanding of the costs of our participation. REPRESENTATIVE WILLIS asked for further clarification as to how this bill would function and offered the Americans With Disabilities Act as an example to see how it would fit under this legislation. MR. KINGMAN responded that to the extent the state is charged with implementing this act, then it would certainly be subject to review under CSHB 83(STA). Number 287 CHAIR JAMES clarified that this bill would require a calculation of the dollar figure of implementing a program as a part of the report. She thought that this was good and stated that the public would probably have apoplexy if we knew what these programs were costing us. MR. KINGMAN agreed, saying this was one of the benefits of this bill, is that it allows us to see what those costs really are, in that it requires to check whether there might be a more cost-effective approach. Number 331 REPRESENTATIVE ROBINSON stated that some federal laws have a time line in which they must be implemented. She asked how this bill proposes to conduct its review before that time limit is reached. MR. KINGMAN replied that this would essentially be up to the Administration, but that this was why this bill allowed for a program to be implemented before the entire review had been completed. What would be required before implementation could go ahead, is the initial analysis report of the implementing agency. Upon receiving this report, the Governor can either authorize complete implementation or implementation in a certain fashion. This allows for the committees to complete their review and determine a more long term approach. REPRESENTATIVE ROBINSON asked if it would be in the report in the case of mandates where there is a penalty for not complying with a particular mandate. CHAIR JAMES followed up by asking if they were just considering the expense of the state or if they were factoring the costs to the public and the private sector as well. MR. KINGMAN said that essentially they were just talking about state spending, but that there was nothing to prevent the OMB or the implementing agency from extending their review to include costs to the public. Number 353 REPRESENTATIVE OGAN stated that when a new administration came in, unless the mandate had changed considerably, their review might consist of just reviewing the existing data and making a decision. He said that they did not have to "reinvent the wheel." He added their hope was this review would cause some of these mandates to be challenged in court, as he believed the federal government routinely oversteps its constitutional authority. REPRESENTATIVE ROBINSON noticed that the fiscal note was relatively small. She wondered if she had all of the documentation. MR. KINGMAN stated that in their packets, there should be an overview sheet. CHAIR JAMES said there was, but that it did not reflect the reduced fiscal note. Number 382 MR. KINGMAN added that the overview sheet and the existing fiscal notes reflected the old version of this bill, which required that the review be done annually and not every four years. He said that they believed the fiscal note would be considerably reduced in this new version. He noted that the last few pages in their packet reflected the reduced fiscal notes from the last committee. CHAIR JAMES stated she would think the intent of this bill should in practice already be being done and that it would be allowed to be done without this bill, but probably wouldn't. She said her biggest concern is the relatively large fiscal note, although she recognized the presumption was that there would actually be a cost-savings by this review and possibly challenging some of these mandates in court. She said this was a premise and not necessarily a fact, as we had no backup for this. Chair James also stated that she wished that there was a list of programs that would be reviewed under this legislation and those that would not be. She thought that as it went through the committee process, this bill might be very vulnerable because of it's large fiscal note. She said they were in a cost-cutting mode. She suspected that if this bill were passed, it would not be funded, and so be ineffective. She gave an example of a past bill that fit this category, in that it passed the legislature and has not been funded for the past ten years. Number 442 REPRESENTATIVE PORTER said he appreciated the sponsor offering this amendment. Realizing that the amendment might create a separations of power issue, he felt that looking back on it, it might be better to not include it in this bill after all, and that as the motivator of this idea, he would withdraw his suggestion. He reiterated though, that he appreciated the effort. CHAIR JAMES noted that this bill had a further referral to the judiciary committee. She asked for a motion to pass this bill to the next committee of referral. REPRESENTATIVE OGAN commented for the record, that as the sponsor, if the committee felt this bill would not save the state money, then he would prefer that it not pass out of this committee. He believed it would save money and that the states were crying out for relief from the tyranny of these federal mandates. He said this bill would depend a lot on the governor pursuing this issue and challenging many of these mandates. He stated he came down to Juneau to try and reduce the size of government, and he reiterated if this bill did not save the state money, then he would rather not pass it out of committee. Number 488 REPRESENTATIVE PORTER said that considering this, the question still remained as to how to overcome the supremacy of federal law over state law, although he recognized that many of the 10th Amendment suits currently being pursued would answer many of those questions. He wasn't sure whether we had the authority to do anything about it, once we found out how bad many of these federal mandates really are. CHAIR JAMES agreed, saying that many of these mandates still awaited court decision as to whether they fit under the Tenth Amendment rights of the states. She added though, that there were cases, such as highway funds, where the state could choose whether to accept them and the strings attached or not. She felt that this was an area where there should be a cost-benefit analysis done. Once we did this review, we could determine whether the costs of implementing these programs were really covered by the federal monies or not. Chair James said she suspected that, in many cases, they were not. She said these programs added to the bureaucratic growth by requiring additional employees to run them. She said many of these mandate issues would have to be settled in a court of law to determine their constitutionality. REPRESENTATIVE PORTER wasn't sure that those cases where there was a choice of whether or not to take federal monies to implement a program would fall under the review of this bill. Number 561 REPRESENTATIVE ROBINSON stated she agreed that the intent of this bill was excellent, but she shared many of the same concerns already expressed. She thought that with the new Congress, this bill might already be a mute point. She added she thought that it might just come down to the legislature doing a better analysis, before they accepted federal monies for a program. She also stated this was something the state legislature needed to look at, because in many cases they put money in to start a program, but do not do an analysis to see what the true costs are of that program. CHAIR JAMES thought that possibly, this bill might have more impact if it interceded in the formulation stage of mandates verses after the fact. She said she had discovered this in drafting her regulation reform bill. She asked for the committee's decision as to whether to pass this bill out of committee. Number 600 REPRESENTATIVE PORTER moved to pass CSHB 83(STA) to the next committee with attached fiscal notes and individual recommendations. He stated that as the chair of the judiciary committee, he would be willing to try and solve many of the above mentioned legal issues in that committee. CHAIR JAMES asked if there were an objection. Hearing none, the bill was moved out of committee.