Legislature(2021 - 2022)ANCH LIO DENALI Rm
09/02/2021 01:00 PM House WAYS & MEANS
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| Audio | Topic |
|---|---|
| Start | |
| HB3004 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB3004 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 3004-APPROP: REVERSE OPERATING APPROP. VETOES
1:04:32 PM
CHAIR SPOHNHOLZ announced that the only order of business would
be HOUSE BILL NO. 3004, "An Act making appropriations for the
operating and loan program expenses of state government and for
certain programs; capitalizing funds; making capital
appropriations and supplemental appropriations; making
appropriations under art. IX, sec. 17(c), Constitution of the
State of Alaska, from the constitutional budget reserve fund;
and providing for an effective date."
1:04:44 PM
REPRESENTATIVE WOOL moved to adopt the proposed committee
substitute (CS) for HB 3004, Version 32-LS1142\I, Marx, 9/1/21,
as a working document. There being no objection, Version I was
before the committee.
1:04:57 PM
CHAIR SPOHNHOLZ explained that HB 3004 contains all the items
the legislature had intended to fund in HB 69 [during the
regular session of the 2021-2022 Thirty-Second Alaska State
Legislature]. She explained that passage of HB 3003 made some
of the items in HB 3004 superlative; Version I removes those
items. She said Alexei Painter would explain Version I.
1:06:23 PM
The committee took a consecutive series of at-eases from 1:06
p.m. to 1:15 p.m. to address technical issues.
1:15:37 PM
ALEXEI PAINTER, Director, Legislative Finance Division,
presented the proposed committee substitute, Version I, for HB
3004 and four corresponding reports [included in the committee
packet]. He said Report 1 is a summary of the bill with all
fund sources. The first column shows the operating items
effective in fiscal year 2022 (FY 22); the second column shows
the operating supplementals; the third column shows the total
operating items; the fourth column shows capital items; the
fifth column shows capital supplementals; the sixth column shows
the capital total; and the seventh column shows the bill total.
He said the bill contains $495.7 million of appropriations,
split up between $163 million on the operating side and $332
million on the capital side. The appropriations consist
primarily of "add-backs" for vetoed items by the governor, as
well as a couple "replacing items" directly funded by the
constitutional budget reserve (CBR) that were removed from HB 69
when that bill failed. He echoed Chair Spohnholz' statement
that Version I removes the duplicate items that were in HB 3003.
He said he would be showing transaction changes that reflect
what the changes are between the two bill versions.
1:17:34 PM
MR. PAINTER said Report 2 is the same as Report 1 but is
restricted to the general fund (GF) thus illuminating the
unrestricted general fund (UGF). He noted that $153.7 million
of operating expenses in HB 3004 are UGF, while $107.8 are
capital [expenses], for a total of $261.5 million UGF for the
entire bill. He drew attention to Report 3, which shows the
items removed from Version I because of HB 3003: $400,000 for
Alaska Legal Services; $1.25 million for public health nursing;
a correction of the over appropriation of the public school
trust fund; and oil and gas tax credits. He said the entire
amount had been funded by the CBR in HB 69, and the original
version of HB 3004 sought to replace the amount with the same
fund source; however, with HB 3003, "some of the funding that
was from the general fund did go out, so this item has been
completely removed from this version of the bill."
1:19:38 PM
MR. PAINTER stated that HB 3004 had a "placeholder" permanent
fund dividend (PFD) of $500 million, but it was removed in
Version I because there was a placeholder PFD in HB 3003. Mr.
Painter noted that there was one change to the capital side of
the bill, shown on the first page of Report 4, which was a fund
source change on the Alaska Travel Industry Association (ATIA).
He explained that the $10 million appropriation had been out of
the statutory budget reserve (SBR) fund in HB 69; the fund
sources "were moved around in HB 3003." He said that $10
million is spoken for by the PFD appropriation; therefore, it
was moved to the GF. He said other than that the rest of the
pages of the report show there are no other changes to "the
capital side" between [the original HB 3004 and Version I].
1:21:33 PM
MR. PAINTER, in response to Representative Wool, confirmed that
none of the items in Version I were reflected in the enacted HB
69.
1:22:55 PM
MR. PAINTER, in response to Representative Josephson,
acknowledged that the reverse sweep restores the balances of the
funds. In response to a follow-up question, he confirmed that
"by reversing the sweep, ... there would be no need to do fund
changes."
1:24:54 PM
MR. PAINTER, in response to Representative Wool, stated that the
reverse sweep numbers are not included in the report but are
estimated to be $900 million to $1 billion, primarily split
between the higher education fund, at about $400 million, the
SBR, which is about $330 million, and other smaller funds. He
directed attention to the UGF spending in Report 2, shown in the
bottom-right of the page as $261.5 million; however, he noted
that $21.3 million of that is the supplemental. He said the
impact of that on the FY 22 budget would be about $240 million.
In response to a follow-up question, he explained that [Version
I] would create a budget deficit, which then would be handled
through Section 15(b). He said in general when there are
deficits, the budget is structured to have "filling language"
related to the CBR. This year was unusual in that items were
directly funded out of other savings accounts in order to make
the budget roughly balanced without deficit language when the
legislature passed it. In response to another follow-up
question from Representative Wool, he confirmed that the amount
that would be needed for "filling" if Version I passed would be
in the range of $200 million.
1:28:21 PM
REPRESENTATIVE JOSEPHSON asked where that money was going to
come from had the governor not vetoed the budget.
1:28:50 PM
MR. PAINTER answered that the fund sources were different in the
conference committee's version of HB 69; the entire amount of
oil and gas tax credits, as well as the PFD, came from the CBR,
as opposed to being split between the CBR and general fund as
they were in HB 3003. He added there was a small deficit of $10
million that would have come from the CBR.
REPRESENTATIVE JOSEPHSON asked for confirmation that the
conference committee version [of HB 69] would have required
"less of a supermajority to fund these elements."
MR. PAINTER replied that in 2019, the legislature had adjourned
without a supermajority vote and with no reverse sweep or
"deficit-filling language." He offered his understanding that
House Bill 2001 had contained the veto restorations, reverse
sweep language, and CBR access.
REPRESENTATIVE JOSEPHSON asked for confirmation that it is
problematic that the CBR is the sole source under the proposed
legislation.
MR. PAINTER declined to comment on "the political problems
caused by any particular thing," but confirmed that because
there was little majority access funding after HB 3003, most of
the funding under the proposed legislation would require a
three-quarters [approval] of the legislature.
1:32:20 PM
REPRESENTATIVE STORY expressed concern about the higher
education investment fund, and she inquired about its status.
MR. PAINTER replied that the funds appropriated out of that fund
were enacted under HB 69, and the governor has said they will be
funded for this year. He indicated that HB 3004 does not
specifically reference that fund, but "it would be included in
that language under [Section] 15(a) of this bill."
REPRESENTATIVE STORY stressed the importance of that happening.
1:34:42 PM
CHAIR SPOHNHOLZ asked how much federal funding is associated
with the appropriations under HB 3004.
MR. PAINTER answered that in Report 1, the federal receipt total
is $220 million, and it is for two items in the capital budget
of the Department of Transportation & Public Facilities
(DOT&PF), both vetoes for the Service Transportation program.
In response to a follow-up question, he offered further
information about what that money was funding.
1:35:43 PM
MR. PAINTER, in response to a question from Representative
Josephson about why federal dollars were vetoed, offered further
context about the process of allocating for projects and
contingencies and intending flexibility for DOT&PF.
REPRESENTATIVE JOSEPHSON remarked that he would not like this
veto if he were commissioner.
1:38:54 PM
CHAIR SPOHNHOLZ agreed with Representative Josephson's comment
that from DOT&PF's perspective, having flexibility "seems like a
good thing, and she commended Representative Story's comment
regarding the Higher Education Fund. She pointed out that the
capital projects would help improve quality of life, and she
noted there is "a laundry list" of services that would be helped
under [HB 3004, Version I], highlighting services for seniors.
1:41:31 PM
REPRESENTATIVE JOSEPHSON said he has faith in Chair Spohnholz,
and he offered his support regarding the consideration of the
proposed legislation.
[HB 3004 was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| CS workdraft version I 9.1.21.pdf |
HW&M 9/2/2021 1:00:00 PM |
|
| HB 3004 Operating Transaction Compare.pdf |
HW&M 9/2/2021 1:00:00 PM |
HB3004 |
| HB3004 Bill Total All Funds.pdf |
HW&M 9/2/2021 1:00:00 PM |
HB3004 |
| HB3004 Bill Total UGF.pdf |
HW&M 9/2/2021 1:00:00 PM |
HB3004 |
| HB 3004 Capital Project Detail.pdf |
HW&M 9/2/2021 1:00:00 PM |
HB3004 |
| HB 3004 Packet of Reports.pdf |
HW&M 9/2/2021 1:00:00 PM |
HB3004 |