Legislature(2003 - 2004)

05/13/2003 08:09 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 228-STATE EMPLOYEES CALLED TO MILITARY DUTY                                                                                
                                                                                                                                
CHAIR WEYHRAUCH announced  that the next order  of business would                                                               
be HOUSE  BILL NO. 228, "An  Act relating to state  employees who                                                               
are called to active duty as  reserve or auxiliary members of the                                                               
armed  forces  of  the  United   States;  and  providing  for  an                                                               
effective date."  [Before the committee is CSHB 228(MLV).]                                                                      
                                                                                                                                
Number 2578                                                                                                                     
                                                                                                                                
JULI LUCKY,  Staff to Representative Beth  Kerttula, Alaska State                                                               
Legislature,  testified on  behalf  of the  sponsor.   Ms.  Lucky                                                               
explained that  HB 228  will give the  governor the  authority to                                                               
extend benefits  and pay  to state employees  that are  called to                                                               
active  duty or  on orders.   The  state employees  would receive                                                               
less pay while working for the  military service.  She offered to                                                               
answer any questions.                                                                                                           
                                                                                                                                
REPRESENTATIVE SEATON  pointed out that the  legislation includes                                                               
a retroactive  provision back  to September  2001.   However, the                                                               
fiscal note  seems to indicate that  no one was called  to active                                                               
duty.                                                                                                                           
                                                                                                                                
MS. LUCKY related her understanding  that eight [state employees]                                                               
could be eligible.  She  explained that the legislation gives the                                                               
governor the  authority to issue the  administrative order, which                                                               
has tremendous latitude.  The fiscal note is indeterminate.                                                                     
                                                                                                                                
REPRESENTATIVE SEATON surmised then  that the authorization would                                                               
be the difference between the  [state employee's] regular pay and                                                               
his/her  military pay,  which  is  a known  quantity  as are  the                                                               
benefits.   However,  there is  no knowledge  with regard  to the                                                               
maximum  authorization amount.   He  asked if  the aforementioned                                                               
merely hasn't been calculated.                                                                                                  
                                                                                                                                
MS.  LUCKY  pointed  out  that   the  Department  of  Military  &                                                               
Veterans' Affairs  prepared the fiscal  note.  Ms.  Lucky related                                                               
that the  sponsor feels that when  people are hired and  a budget                                                               
is created,  the departments have  already incurred  those costs.                                                               
Therefore, the only time that  additional costs would be incurred                                                               
if someone  had to  fill the  position of  an employee  called to                                                               
active duty.                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON asked  if people  have been  pulled in  to                                                               
fill  the  employees'  positions  over the  several  year  period                                                               
specified in the legislation.                                                                                                   
                                                                                                                                
MS. LUCKY  said she  understood that when  people were  called to                                                               
duty  during  the  retroactive  period  the  employees  were,  on                                                               
average,  only  gone   for  around  three  months.     Ms.  Lucky                                                               
acknowledged  that the  retroactive provision  has been  an issue                                                               
for the administration.   She explained that  those covered under                                                               
the retroactive provision  are looking for the known  net loss in                                                               
their retirement  benefits and accrual  of time.   Obviously, the                                                               
[state]  wouldn't extend  the pay  and health  benefits to  these                                                               
people at this time.  These  individuals are looking for the time                                                               
that they  were called to  duty to count toward  their retirement                                                               
and retirement benefit credit.                                                                                                  
                                                                                                                                
Number 2360                                                                                                                     
                                                                                                                                
REPRESENTATIVE   DAHLSTROM  asked   if  this   legislation  would                                                               
basically  bring  the  state  into  compliance  with  what  other                                                               
businesses  are  required to  do  when  employees are  called  to                                                               
active duty.                                                                                                                    
                                                                                                                                
MS. LUCKY  answered that  the state  meets the  requirements now.                                                               
However,  since [the  terrorist  attacks of  September 11,  2001]                                                               
businesses and  employers have tried  to provide  their employees                                                               
with no  net loss.   The  thought is  that if  one is  willing to                                                               
fight for  the country, that  individual's family  shouldn't lose                                                               
health  benefits and  the  individual  shouldn't lose  retirement                                                               
benefits  or  pay  while  on  active  duty.    She  informed  the                                                               
committee  that   the  states   that  have   some  sort   of  pay                                                               
differential  or  medical  coverage  to make  up  the  difference                                                               
[between  the  individuals regular  pay  and  benefits and  those                                                               
received  from the  military]  are as  follows:   Tennessee,  New                                                               
York,  Florida,  Virginia,   California,  Delaware,  Kansas,  New                                                               
Jersey, Ohio, Okalahoma, West  Virginia, Washington, and Wyoming.                                                               
She noted that some of the  private companies that are doing this                                                               
are as follows:   American Express, Boeing, Co.,  Coca Cola, Ford                                                               
Motor Co., Hewlett Packard, Sara Lee,  UPS, and Xerox.  Ms. Lucky                                                               
specified that  the benefits would  only go to  those individuals                                                               
who would make  less while on active  duty than if at  home.  The                                                               
past testimony has  related that the average  deployment is three                                                               
months and  dependents don't receive benefits  until the deployed                                                               
individual  has been  gone for  about  180 days.   The  sponsor's                                                               
intent is  to allow the governor  to say that those  fighting for                                                               
the  country  shouldn't  have   to  suffer  additional  financial                                                               
hardships while serving.                                                                                                        
                                                                                                                                
REPRESENTATIVE DAHLSTROM related her  understanding that when men                                                               
and women are called to active duty there is no choice.                                                                         
                                                                                                                                
MS.  LUCKY  said  that  she  believes HB  228  would  cover  both                                                               
voluntary and involuntary service.                                                                                              
                                                                                                                                
Number 2210                                                                                                                     
                                                                                                                                
REPRESENTATIVE  HOLM remarked  that he  has no  problem with  the                                                               
idea behind this  legislation.  However, he  noted his discomfort                                                               
with  a fiscal  note that  doesn't have  limits.   Representative                                                               
Holm  questioned whether  it's  good policy  to pass  legislation                                                               
when there is no way to know if it can be funded or not.                                                                        
                                                                                                                                
REPRESENTATIVE  GRUENBERG  characterized  HB  228 as  a  type  of                                                               
unfunded  mandate.   Representative  Gruenberg  said he  believes                                                               
it's  time for  the  federal  government to  review  the cost  of                                                               
serving and  who should  bear that  cost and  whether this  is an                                                               
unfunded  mandate.   Perhaps  the state  should  ask Congress  to                                                               
consider this part  of the cost of waging war  and perhaps Alaska                                                               
should be  the first state  to speak  up for those  who sacrifice                                                               
not  only  their lives  but  also  their entire  family  savings.                                                               
Representative Gruenberg said he would  like to know whether it's                                                               
appropriate to insert such language in this legislation.                                                                        
                                                                                                                                
REPRESENTATIVE   LYNN   agreed  with   Representative   Gruenberg                                                               
regarding  this  legislation  being  an unfunded  mandate.    The                                                               
families of  those serving are  often the  ones who bear  a large                                                               
part  of  the  burden.   Representative  Lynn  suggested  that  a                                                               
resolution  on this  matter would  probably be  appropriate.   He                                                               
offered  to   work  with  Representative  Gruenberg   on  such  a                                                               
resolution.                                                                                                                     
                                                                                                                                
Number 1913                                                                                                                     
                                                                                                                                
CHAIR  WEYHRAUCH inquired  as to  how many  individuals would  be                                                               
impacted by this legislation now.                                                                                               
                                                                                                                                
MS.  LUCKY said  that last  year eight  state employees  would've                                                               
qualified.                                                                                                                      
                                                                                                                                
CHAIR WEYHRAUCH inquired  as to the policy  justification to have                                                               
this retroactive and he asked  if the legislation would be harmed                                                               
if the retroactive provision wasn't included.                                                                                   
                                                                                                                                
MS. LUCKY reiterated that the  retroactive provision was included                                                               
to help  those called  to duty during  [the terrorist  attacks of                                                               
September  11, 2001]  and  the subsequent  events.   The  sponsor                                                               
intended for those  individuals to recoup some  of the retirement                                                               
benefits that were  lost.  The retroactive provision  has been an                                                               
item of discussion and is left to the committee's discretion.                                                                   
                                                                                                                                
CHAIR WEYHRAUCH  related his  understanding that  the retroactive                                                               
provision would bestow health benefits on one of the eight.                                                                     
                                                                                                                                
MS.  LUCKY  explained that  the  legislation  is permissive,  and                                                               
therefore   it   would   depend   upon  the   language   of   the                                                               
administrative order.                                                                                                           
                                                                                                                                
CHAIR  WEYHRAUCH inquired  as  to how  health  benefits would  be                                                               
given retroactively.                                                                                                            
                                                                                                                                
MS. LUCKY said that in  her opinion, the health benefits wouldn't                                                               
be  something that  [an administrative  order] would  give.   The                                                               
intent  is to  allow the  governor to  put out  an administrative                                                               
order that  would allow people  who might  not have been  able to                                                               
qualify or vest in their  retirement to receive credited time for                                                               
the time  they were away.   It  wasn't [the sponsor's]  intent to                                                               
give these people back pay or health benefits.                                                                                  
                                                                                                                                
Number 1775                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM pointed out that  if a family member had                                                               
surgery  during  the time  [when  the  individual was  called  to                                                               
active  duty],   with  the  passage   of  this   legislation  the                                                               
individual  would  be able  to  submit  the  costs for  that  and                                                               
recover those costs.   Representative Dahlstrom characterized the                                                               
aforementioned as a good thing.                                                                                                 
                                                                                                                                
CHAIR WEYHRAUCH asked if the  military would have health benefits                                                               
that the individual called to duty could obtain.                                                                                
                                                                                                                                
MS. LUCKY related her understanding  that the individual would be                                                               
covered by  those health benefits  and after 180 days  the health                                                               
benefits  would be  available to  the dependents.   However,  the                                                               
problem is  that the  [dependents] would  only receive  the state                                                               
benefits  through the  month the  individual called  to duty  was                                                               
working unless the individual had  enough leave to cover the time                                                               
he/she was gone.   Therefore, the dependents  wouldn't be covered                                                               
under the individual called to duty.                                                                                            
                                                                                                                                
Number 1705                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON  asked if the eight  individuals this would                                                               
address were volunteers to duty or were called to duty.                                                                         
                                                                                                                                
MS. LUCKY said that she didn't have that information.                                                                           
                                                                                                                                
Number 1660                                                                                                                     
                                                                                                                                
JOHN   CRAMER,   Director,  Administrative   Services   Division,                                                               
Department  of   Military  &  Veterans'  Affairs,   responded  to                                                               
Representative Seaton's  question by saying that  he believes the                                                               
eight individuals were called to duty.                                                                                          
                                                                                                                                
CHAIR  WEYHRAUCH  pointed  out   that  in  the  PERS  information                                                               
handbook it addresses  the call to active duty  by specifying the                                                               
following:  "If you are  called to active duty either voluntarily                                                               
or involuntarily during  your active PERS service  and you return                                                               
to the same  PERS employer within 90 days  of honorable discharge                                                               
from active duty, your military  service is considered membership                                                               
service time.   You will need  to submit a written  request along                                                               
with  a copy  of  your  military discharge  papers  to have  this                                                               
service time credited.   There is no cost for  this service."  He                                                               
inquired as  to how that  worked with what is  being accomplished                                                               
in this legislation.                                                                                                            
                                                                                                                                
MS. LUCKY said she could get an answer for the committee.                                                                       
                                                                                                                                
MS. CRAMER said he couldn't  comment and deferred to the Division                                                               
of Retirement and Benefits.                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN  indicated that  one of  the basic  issues is                                                               
with regard to  the dependents who experience a  gap in coverage.                                                               
The  person  recalled  to  active  duty  receives  military  pay,                                                               
health, and benefits.  This  lapse in coverage for the dependents                                                               
isn't helpful for morale.                                                                                                       
                                                                                                                                
REPRESENTATIVE  SEATON surmised  from the  excerpt from  the PERS                                                               
information  handbook   that  the  retirement  benefits   of  [an                                                               
individual called  to active duty]  is covered if they  return to                                                               
state service  and apply  [to receive] it.   Therefore,  it seems                                                               
the retirement  benefit is already  addressed.  He noted  that he                                                               
has problems with retroactive clause.                                                                                           
                                                                                                                                
Number 1486                                                                                                                     
                                                                                                                                
REPRESENTATIVE   DAHLSTROM  said   that   she   shared  some   of                                                               
Representative Seaton's concerns regarding  the fiscal impacts of                                                               
this.   However, she  said that  she has  such great  respect for                                                               
those willing to  put their lives on the line  that perhaps there                                                               
are some costs  that [the state] does need to  incur and thus she                                                               
is comfortable with the legislation.                                                                                            
                                                                                                                                
REPRESENTATIVE SEATON  commented that  he doesn't have  a problem                                                               
with  the   legislation.    However,   every  time  there   is  a                                                               
retroactive clause it seems to create a "sticky wicket."                                                                        
                                                                                                                                
REPRESENTATIVE   CRAWFORD  turned   to  Representative   Seaton's                                                               
"sticky wicket"  remark and said  that [some of]  the retroactive                                                               
dates changed  court orders or  cases, which isn't the  case with                                                               
this  legislation.   It seems  that legislation  very similar  to                                                               
this was  passed out of  this committee;  he inquired as  to what                                                               
happened with that legislation.                                                                                                 
                                                                                                                                
MS.  LUCKY confirmed  that there  was [similar]  legislation last                                                               
year in  both the House  and the  Senate.  The  legislation [from                                                               
last  year] ended  up permanently  residing in  the Senate  State                                                               
Affairs Standing Committee.                                                                                                     
                                                                                                                                
Number 1221                                                                                                                     
                                                                                                                                
REPRESENTATIVE  SEATON  asked if  the  health  benefits of  these                                                               
[eight] individuals is  restored [for that time  of active duty],                                                               
would  it  mean  that  [the  state]  would  pay  for  the  health                                                               
insurance premiums  that those  folks may or  may not  have used.                                                               
He expressed concern that this  retroactivity allows the governor                                                               
to  give these  individuals  pay  for the  time  gone from  state                                                               
service.     Therefore,  he  moved   that  the   committee  adopt                                                               
Conceptual Amendment 1 as follows:                                                                                              
                                                                                                                                
     Page 2, line 20, after "2001"                                                                                              
          Insert "for health and accrual of retirement                                                                          
     benefit qualifications only"                                                                                               
                                                                                                                                
REPRESENTATIVE  GRUENBERG objected  and expressed  his desire  to                                                               
meet on this  topic this afternoon when perhaps  someone from the                                                               
Division  of   Retirement  and   Benefits  could   be  available.                                                               
Therefore, he  requested that Conceptual  Amendment 1 be  held on                                                               
the table until that time.                                                                                                      
                                                                                                                                
REPRESENTATIVE  CRAWFORD  noted   his  opposition  to  Conceptual                                                               
Amendment 1  because he  believes the  intent is  to make  up the                                                               
difference  in people's  pay if  called  to active  duty.   Those                                                               
individuals shouldn't be made to  suffer for doing their duty for                                                               
the country.   He remarked that  the believes the intent  of this                                                               
legislation is the right intent.                                                                                                
                                                                                                                                
REPRESENTATIVE DAHLSTROM  said that she  would like to  leave the                                                               
legislation as it stands.                                                                                                       
                                                                                                                                
REPRESENTATIVE LYNN echoed Representative Dahlstrom's sentiment.                                                                
                                                                                                                                
A roll  call vote was  taken.  Representatives Holm,  Seaton, and                                                               
Weyhrauch   voted   in   favor   of   Conceptual   Amendment   1.                                                               
Representatives  Dahlstrom, Lynn,  Crawford, and  Gruenberg voted                                                               
against it.   Therefore, Conceptual Amendment 1 failed  by a vote                                                               
of 3-4.                                                                                                                         
                                                                                                                                
Number 0858                                                                                                                     
                                                                                                                                
REPRESENTATIVE  DAHLSTROM moved  to report  CSHB 228(MLV)  out of                                                               
committee  with individual  recommendations and  the accompanying                                                               
fiscal  notes.   There  being  no  objection, CSHB  228(MLV)  was                                                               
reported from the House State Affairs Standing Committee.                                                                       
                                                                                                                                

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