Legislature(1995 - 1996)

02/15/1996 09:15 AM Senate FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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  SENATE BILL NO. 232                                                          
                                                                               
       An  Act  relating  to permanent  fund  dividend program                 
       notice requirements, to the ineligibility for dividends                 
       of individuals  convicted of  felonies or  incarcerated                 
       for  misdemeanors,  and  to  the  determination  of the                 
       number and identity of  certain ineligible individuals;                 
       and providing for an effective date.                                    
                                                                               
  Co-chairman Halford  directed that SB 232 be  brought on for                 
  discussion.  Senator Frank explained  that the proposed bill                 
  would remove  third-time misdemeanants from  eligibility for                 
  permanent fund dividends.  He noted that those moving in and                 
  out of the  correctional system incur substantial  costs for                 
  the  criminal justice system.   It is  thus appropriate that                 
  they  contribute  their  permanent   fund  dividends  toward                 
  defraying part of that cost.                                                 
                                                                               
  The  major change from the bill that was vetoed last year is                 
  that  collection  of the  dividend  is not  accelerated, and                 
  dividends are not utilized in the current budget year.                       
                                                                               
  TOM WILLIAMS, aide  to Senator  Frank, explained that  under                 
  current  law  an  individual   incarcerated  for  a   felony                 
  conviction is ineligible  for a  permanent fund dividend  in                 
  the next calendar year.  The law also allows the amount that                 
  would  have been paid  to individuals,  for the  next fiscal                 
  year, to  be appropriated  from the  dividend fund  (without                 
  notice on the dividend stub) to three entities:                              
                                                                               
       1.   The crime victim compensation fund.                                
       2.   Counsel on domestic violence and sexual assault                    
       3.   Dept. of Corrections                                               
                                                                               
  The proposed bill will accomplish four ends:                                 
                                                                               
       1.   Increase the  pool of  individuals ineligible  for                 
  the       permanent fund dividend to include those who, in a                 
            given   year,  are  convicted   of  a   felony  or                 
            incarcerated   for   their  third   or  subsequent                 
            misdemeanor conviction.                                            
                                                                               
                                                                               
       2.   Require  that  the  dividend  stub provide  public                 
  notice of           the  criteria  for  denying individuals,                 
                      the  legislative  purpose   for  denying                 
                      those individuals, the amount that would                 
                      have been paid in  the prior fiscal year                 
                      to the  individuals, and how  that money                 
                      was  appropriated  to   the  above-noted                 
                      agencies in the subsequent fiscal year.                  
                                                                               
       3.   Add the departments  of Public  Safety and Law  to                 
  the list       of   criminal    justice   system    agencies                 
                 authorized to receive the funds.                              
                                                                               
       4.   Clarify the purposes  for which  the funds may  be                 
  used.                                                                        
                                                                               
  Mr. Williams directed attention to file materials containing                 
  a sectional  analysis  of  the  bill  and  a  comparison  of                 
  agencies now receiving funds and  those which would received                 
  funds under the proposed legislation.                                        
                                                                               
  Fiscal notes from  the Dept. of  Public Safety and Dept.  of                 
  Revenue are the  same as last year.  The note from the Dept.                 
  of Corrections is $68.0 as opposed to zero last year.                        
                                                                               
  While  the   original  approach  contemplated   that  notice                 
  provisions be  added to  this year's  dividends, a  proposed                 
  amendment would start notification a year from now.                          
                                                                               
  Concerns  regarding prior  legislation pertained  to whether                 
  agencies  that  presently garnish  permanent  fund dividends                 
  would be  impacted.  The  estimated effect on  child support                 
  enforcement garnishments is negligible  (less than one tenth                 
  of  one  percent of  child support).   Mr.  Williams further                 
  commented on  diversion of  permanent fund  moneys to  child                 
  support and indicated that discussion of that issue would be                 
  ongoing.  Department proposals will be explored.                             
                                                                               
  END:      SFC-96, #26, Side 1                                                
  BEGIN:    SFC-96, #26, Side 2                                                
                                                                               
  In response to a question from Senator Zharoff, Mr. Williams                 
  noted  that  legislative  attorneys   raised  constitutional                 
  questions  over  denial of  funds  to felons  and subsequent                 
  appropriation to  a specific  individual or  case.   Senator                 
  Frank advised that  the bill would  be held in committee  to                 
  work on the issue.                                                           
                                                                               
  NANCY  JONES,  Director, Permanent  Fund Division,  Dept. of                 
  Revenue, next  came before  committee.   She referenced  the                 
  above-noted  amendment  and  asked  that  it   be  favorably                 
  considered.                                                                  
                                                                               
  Speaking to expansion  of the class of  ineligible permanent                 
                                                                               
                                                                               
  fund dividend recipients, Ms. Jones said that the department                 
  has  no  problem  with addition  of  felony  convictions and                 
  incarcerated  misdemeanants.    Income  diversion,  however,                 
  remains a concern.                                                           
                                                                               
  Ms. Jones further  attested to  technical problems with  the                 
  bill  concerning  the flow  of  information  on convictions,                 
  particularly   for   those   who  are   convicted   but  not                 
  incarcerated.                                                                
                                                                               
  Ms. Jones voiced support for  disclosure requirements of the                 
  bill.   She explained  that the  department interprets  bill                 
  language  to  require   that  information  flow   to  felons                 
  ineligible  to  receive  the  dividend  rather than  to  the                 
  general public.   The department fiscal note  is higher than                 
  last year because of a noticeable  increase in the number of                 
  appeals as a  result of  the program.   The department  thus                 
  seeks funding for a  position to handle appeals.   The issue                 
  is the  same within  the Dept.  of Corrections.   Ms.  Jones                 
  described  the  transfer  of  information  between  the  two                 
  departments during the appeal process.                                       
                                                                               
  In her  closing remarks,  Ms. Jones  reiterated support  for                 
  expansion of the  class of  ineligible recipients and  urged                 
  that the committee give favorable consideration to  addition                 
  of child  support--the largest  recipient of  funds--if that                 
  provision can be added to the bill.                                          
                                                                               
  ANNE   CARPENETI,   Assistant  Attorney   General,  Criminal                 
  Division,  Dept. of Law,  came before committee.   She noted                 
  that  denial of  dividends to  third-time misdemeanants  and                 
  those convicted of but not incarcerated for felonies removes                 
  possible funds  to pay orders  of restitution to  victims of                 
  crime who are not covered by the violent crimes compensation                 
  board.    Co-chairman   Halford  asked  if  statistics   are                 
  available showing  how many  dividend dollars  are used  for                 
  restitution  and child support.   Both Co-chairmen concurred                 
  in need for  those numbers.  Co-chairman  Frank advised that                 
  analysis indicates  that only  a small  percentage flows  to                 
  child support enforcement.                                                   
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  The meeting was adjourned at approximately 10:10 a.m.                        
                                                                               

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