Legislature(1999 - 2000)

04/14/2000 06:22 PM Senate FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 98(HES) am                                                                              
"An Act relating to contracts for the provision of                                                                              
state public assistance to certain recipients in the                                                                            
state; providing for regional public assistance plans                                                                           
and programs in the state; relating to grants for                                                                               
Alaska Native family assistance programs; relating to                                                                           
assignment of child support by Alaska Native family                                                                             
assistance recipients; to paternity determinations and                                                                          
genetic testing involving recipients of                                                                                         
                                                                                                                                
                                                                                                                                
This was the first hearing for this bill in the Senate                                                                          
Finance Committee.                                                                                                              
                                                                                                                                
JIM NORLAND, Director, Division of Public Assistance,                                                                           
Department of Health and Social Services, testified that                                                                        
this bill would help to continue the progress of welfare                                                                        
reform in the State Of Alaska.                                                                                                  
                                                                                                                                
Mr. Nordland stated the authority to run the federal                                                                            
programs at the state government level is one of the main                                                                       
reasons for welfare reform's success in Alaska and other                                                                        
states. He explained that state governments have been able                                                                      
to use this power to dramatically reduce caseloads, help                                                                        
families return to work and out of poverty. In exchange for                                                                     
the flexibility, he said states are receiving a specific                                                                        
amount of money from the federal government, known as a Cap                                                                     
Block Grant. He attested this arrangement between the                                                                           
federal government and Alaska's government has worked very                                                                      
well to reduce welfare dependency.                                                                                              
                                                                                                                                
In addition to granting ownership of welfare programs to                                                                        
the states, Mr. Nordland stated the federal law allows                                                                          
tribes in the Lower 48 and the 13 regional Alaska Native                                                                        
non-profit organizations to run their own welfare programs                                                                      
as well. He shared that funding for the Native-operated                                                                         
programs is taken from the amount allocated to the state.                                                                       
                                                                                                                                
Mr. Nordland noted that while states are required to                                                                            
participate in funding the state-operated welfare programs,                                                                     
there is no requirement in federal law for any entity to                                                                        
contribute to the funding of Native-operated programs.                                                                          
However, he said that the state contributes approximately                                                                       
fifty percent of the funds needed to operate the Native-run                                                                     
programs.                                                                                                                       
                                                                                                                                
Mr. Nordland then explained that this bill allows for the                                                                       
expenditure of state funds for Native-operated welfare                                                                          
programs. He stressed that the only eligible organizations                                                                      
that can receive these funds are the 13 regional non-profit                                                                     
Native organizations.                                                                                                           
                                                                                                                                
Mr. Nordland added that the intention is to transfer from                                                                       
the state, the amount of money needed to pay for benefits,                                                                      
administration, child care, work services, etc. He said                                                                         
this money is currently being paid by the state to serve                                                                        
the same participants in programs that would now be run by                                                                      
Native organizations. He pointed out this is the reason for                                                                     
the bill's zero fiscal note.                                                                                                    
                                                                                                                                
Mr. Nordland shared that the Tanana Chiefs Conference                                                                           
(TCC), an Interior Alaska organization operating under the                                                                      
Doyon Native Corporation is currently operating a welfare                                                                       
program. He said that the state could appropriate federal                                                                       
funding to this organization so long as the program it                                                                          
operates is the same as the one operated by the states'                                                                         
Alaska Temporary Assistance Program (ATAP). However, he                                                                         
stated that TCC had planned to run its program differently                                                                      
than the state, and without this legislation, would be                                                                          
unable to receive funding. He deferred to a representative                                                                      
from the TCC to detail the culturally relevant approach of                                                                      
the Native-operated program.                                                                                                    
                                                                                                                                
Mr. Nordland stressed that the department supports giving                                                                       
flexibility to the Native organizations so that the                                                                             
programs can be run with more local control and with better                                                                     
cultural relevancy.                                                                                                             
                                                                                                                                
Mr. Nordland qualified there are limits as to how different                                                                     
the Native-operated programs could be from the state-                                                                           
operated program. He stated that Alaska's congressional                                                                         
delegation inserted language into federal law requiring                                                                         
Native programs to be comparable to the state program. He                                                                       
said the department has worked with the Native                                                                                  
organizations to design the comparability criterion, which                                                                      
have been approved by the US Secretary of Health and Human                                                                      
Services.                                                                                                                       
                                                                                                                                
Mr. Nordland summarized that if this legislation passes,                                                                        
there would be a Native-operated program comparable to the                                                                      
state program but somewhat different in order to meet local                                                                     
and cultural circumstances.                                                                                                     
                                                                                                                                
Senator Green then asked if this legislation requires                                                                           
federal "blessing" before the funds could be allocated.                                                                         
                                                                                                                                
Mr. Nordland affirmed the plan does need to get federal                                                                         
approval.                                                                                                                       
                                                                                                                                
Mr. Nordland concluded his presentation saying that the                                                                         
department supports the legislation because it is believed                                                                      
the welfare reform efforts could be more successful if the                                                                      
Native organizations are allowed to operate their own                                                                           
programs. He attested that the organizations know the needs                                                                     
of their region and the people and that the programs could                                                                      
be run more effectively than the state could.                                                                                   
                                                                                                                                
Senator Leman asked if federal law allows allocations to                                                                        
other organizations besides Native organizations. He                                                                            
referred to earlier discussion he had with the witness on                                                                       
this matter where he shared his desire to broaden the                                                                           
localization of the welfare reform programs.                                                                                    
                                                                                                                                
Mr. Nordland replied there is a specific provision in                                                                           
federal law applying only to tribes in the Lower 48 and                                                                         
Native Alaskan organizations. He advised however, that                                                                          
there is no reason the state cannot contract the programs                                                                       
out to municipalities or other entities. In fact, he said                                                                       
many states have privatized the services to for-profit                                                                          
organizations.                                                                                                                  
                                                                                                                                
Senator Green asked if privatization or shifting the                                                                            
programs to the local level would require federal approval                                                                      
as well.                                                                                                                        
                                                                                                                                
Mr. Nordland answered federal approval would not                                                                                
necessarily be required.                                                                                                        
                                                                                                                                
Amendment #1: This amendment inserts a new subparagraph on                                                                      
page 11, line 22 to read as follows.                                                                                            
                                                                                                                                
(4) establish the same maximum number of                                                                                        
months of benefits as is established for the                                                                                    
state program under AS 47.27.015 (a)(1); and                                                                                    
(5)                                                                                                                             
                                                                                                                                
[This amendment was not offered at this meeting but was                                                                         
discussed.]                                                                                                                     
                                                                                                                                
Senator Adams requested the department comment on the                                                                           
proposed amendment. He described it sets uniform standards                                                                      
for the maximum amount of benefits that could be collected                                                                      
by participants of either the state or Native-operated                                                                          
welfare programs.                                                                                                               
                                                                                                                                
Mr. Nordland stated that the department supports the                                                                            
amendment, referring to his earlier statement about the                                                                         
comparable criterion between the two programs. He noted                                                                         
that the issue of consistent benefit eligibility was                                                                            
overlooked when the criterion was developed. He told the                                                                        
Committee that federal law allows the Native organizations                                                                      
to negotiate with the federal government on the length of                                                                       
time benefits could be collected by participants. He said                                                                       
the reason for this allowance is to give some Indian                                                                            
reservations an exemption from the 60-month lifetime                                                                            
benefits limit. He stressed that this exemption was outside                                                                     
the bounds of the comparability arrangement between the                                                                         
state and Alaska Native organizations. He said the                                                                              
department supports holding Native-operated programs to the                                                                     
60-month limit just as the state-operated program is. He                                                                        
commented that this amendment "plugs a loophole in this                                                                         
bill."                                                                                                                          
                                                                                                                                
Mr. Nordland stressed that villages with an unemployment                                                                        
rate of over 50 percent would be exempt from the 60-month                                                                       
limit whether the residents participate in a state-operated                                                                     
or Native-operated program. He expressed that this                                                                              
amendment does not apply to specific communities but rather                                                                     
the operator of the program. This is to prevent                                                                                 
participants of a Native-operated program who do not live                                                                       
in a community with more than 50 percent unemployment to                                                                        
receive more than 60 months of benefits, according to Mr.                                                                       
Nordland. In this manner, he said, the exemption would be                                                                       
based on the community itself rather than the operator of                                                                       
the program serving it and possibly other communities as                                                                        
well.                                                                                                                           
                                                                                                                                
Co-Chair Torgerson asked for an explanation of Section 5.                                                                       
                                                                                                                                
Mr. Nordland replied that this section was part of changes                                                                      
made to the bill by the House of Representatives relating                                                                       
to child support payments. He believed the language to be                                                                       
conforming to other child support enforcement statutes.                                                                         
                                                                                                                                
KRISTEN BOMENGEN, Assistant Attorney General, Human                                                                             
Services Section, Civil Division, Department of Law,                                                                            
testified that this section is the result of a                                                                                  
comprehensive review of the child support provisions. The                                                                       
purpose, she said is to ensure that child support payments                                                                      
that are collected on behalf of participants who are                                                                            
receiving public assistance under Native-operated programs                                                                      
are distributed to that Native organization. She stated                                                                         
that the intent is to remove any possible barriers to                                                                           
making appropriate distributions.                                                                                               
                                                                                                                                
Co-Chair Torgerson asked if the child support payments only                                                                     
included those collected under court order.                                                                                     
                                                                                                                                
Ms. Bomengen replied all child support payments are subject                                                                     
to distribution to the program's operator.                                                                                      
                                                                                                                                
Co-Chair Torgerson wanted to know if "petitioning the                                                                           
court" in the language relating to enforcement of child                                                                         
support orders could include tribal courts.                                                                                     
                                                                                                                                
Ms. Bomengen confidently stated that is not the intent to                                                                       
petition any tribal court.                                                                                                      
                                                                                                                                
Co-Chair Torgerson wanted assurance.                                                                                            
                                                                                                                                
Ms. Bomengen expressed it is not a function of the Division                                                                     
of Child Support Enforcement to operate in tribal court.                                                                        
Instead, she said the agency follows the rulings of state                                                                       
court. She said there is no intention to expand the                                                                             
agency's efforts into tribal courts.                                                                                            
                                                                                                                                
Co-Chair Torgerson acquiesced, but asked about the recent                                                                       
Supreme Court ruling in John v. Baker, which authorizes                                                                         
tribal courts to issue child support orders.                                                                                    
                                                                                                                                
Ms. Bomengen needed an opportunity to review the court case                                                                     
before giving a specific opinion on the matter.                                                                                 
                                                                                                                                
Co-Chair Torgerson stated he wanted an understanding of the                                                                     
impact of the court decision on this legislation. He then                                                                       
referred to Section 21 that allows the department to adopt                                                                      
program standards that vary by region. He wanted to know                                                                        
why standard practices would not be adopted so all Alaskans                                                                     
are treated equally.                                                                                                            
                                                                                                                                
Mr. Nordland responded that the language in Section 21                                                                          
conforms to other sections of the bill to allow regional                                                                        
public assistance programs to be established by the                                                                             
department. He shared that the motivation is to prevent the                                                                     
department from having to create a separate program for the                                                                     
few non-Native residents of a Native village, served by a                                                                       
Native-operated welfare program. He stated that this                                                                            
provision allows the non-Natives to be served by Native                                                                         
organizations.                                                                                                                  
                                                                                                                                
Co-Chair Torgerson understood the intent but claimed the                                                                        
language instead allows the department to vary program                                                                          
standards by region. He thought this provision was too                                                                          
broad-based.                                                                                                                    
                                                                                                                                
Mr. Nordland responded that the intent is to adopt the                                                                          
program standards of the Native-operated plan, which would                                                                      
be comparable yet different than the state-operated                                                                             
program. In doing this, he said, all residents of a                                                                             
community could be served by the Native-operated plan.                                                                          
                                                                                                                                
Ms. Bomengen addressed a concern raised in other committees                                                                     
regarding a potential equal protection question. She                                                                            
detailed that the bill contains a requirement that in any                                                                       
area in which a Native corporation is operating a welfare                                                                       
program, eligible Alaska Natives must seek their services                                                                       
from that program and not from a state-operated program.                                                                        
She spoke of funding for the participant as well as the                                                                         
Native program in these cases. She suggested the approved                                                                       
Native-operated programs should be identical to one that                                                                        
the state would operate if it were to do so.                                                                                    
                                                                                                                                
Ms. Bomengen then explained how the Alaska court applies a                                                                      
"sliding scale test" to any equal protection challenge.                                                                         
This test, she said is used to determine whether a greater                                                                      
or lesser burden is placed on the state to justify a                                                                            
classification of individuals to be served by one plan or                                                                       
another, depending on the importance of the individual                                                                          
rights involved. She detailed how the court determines what                                                                     
kind of weight should be given to the constitutional                                                                            
interest impaired by the legislation, examines the purpose                                                                      
of the legislation, and evaluates the state's interest in                                                                       
the means employed to further the goals of the state.                                                                           
                                                                                                                                
Ms. Bomengen stressed that an equal protection challenge to                                                                     
this legislation would probably claim there to be an                                                                            
impermissible classification based on the race of the                                                                           
individual. She said the state's response would then be                                                                         
based on other equal protection cases that have addressed                                                                       
the same distinction. She explained this distinction was                                                                        
created by a federal act, which is born out of the federal                                                                      
government's trust relationship and responsibilities to                                                                         
American Indians and Alaskan Natives. Therefore, she                                                                            
surmised the distinction would be a quasi-political issue                                                                       
based on the unique political status of indigenous peoples                                                                      
and not considered a racial classification.                                                                                     
                                                                                                                                
Ms. Bomengen continued detailing why an equal protection                                                                        
challenge would not succeed saying that, regardless of                                                                          
whether the state or a Native organization operated the                                                                         
program, the participant's benefits would not be affected,                                                                      
services would not be denied and the subsequent impact on                                                                       
the family would be insignificant. She said this is because                                                                     
of the comparability requirements for both programs under                                                                       
state and federal law.                                                                                                          
                                                                                                                                
Ms. Bomengen relayed a suggested amendment to the bill made                                                                     
to the House of Representatives that would allow an                                                                             
individual who is directed to the Native-operated program                                                                       
to request service under the state-operated program. A                                                                          
successful request, she said would demonstrate a compelling                                                                     
interest to receive services from the state rather than the                                                                     
Native organization. She added that the Department of                                                                           
Health and Social Services would develop standards for this                                                                     
exception in regulation.                                                                                                        
                                                                                                                                
Senator Phillips asked if there was a legal opinion on this                                                                     
matter from the Division of Legal and Research Services.                                                                        
                                                                                                                                
Co-Chair Torgerson said there was not but noted a request                                                                       
would be submitted.                                                                                                             
                                                                                                                                
Co-Chair Torgerson acknowledged the fiscal note was zero                                                                        
but wanted information about the federal grant funds and                                                                        
necessary general fund money to implement the new programs.                                                                     
                                                                                                                                
Mr. Nordland first commented that not all of the 13                                                                             
regional Native corporations are interested in operating                                                                        
welfare programs. He noted that there is already one                                                                            
Native-operated program established and that the Tlingit-                                                                       
Haida Corporation and the Association of Village Council                                                                        
Presidents have expressed interest in establishing their                                                                        
own program. He then explained that the department would                                                                        
transfer not only the benefits portion of the welfare                                                                           
programs to participating Native corporations, but also a                                                                       
portion of the administrative funds as well. He admitted                                                                        
this was not easy for the department to do because of the                                                                       
impact on its administrative abilities. However, he said in                                                                     
the long run the programs would be run more effectively                                                                         
with higher caseload reductions.                                                                                                
                                                                                                                                
Mr. Nordland stressed this bill has no impact on the                                                                            
general fund, either positive or negative.                                                                                      
                                                                                                                                
Senator Wilken wanted to understand the flow of the funding                                                                     
from the federal level to the beneficiary.                                                                                      
                                                                                                                                
Mr. Nordland detailed that the Native-operated program must                                                                     
first have a plan approved by the federal government, which                                                                     
requires some state funding to make the plan comparable to                                                                      
the state-operated plan.  Once the Native-operated plan is                                                                      
approved, he said a portion of the federal funds provided                                                                       
to the state go directly to the Native organization. He                                                                         
expressed that the intent of this legislation is to allow                                                                       
the state funds to be allocated to the Native organizations                                                                     
so those programs can be operated at the same level as the                                                                      
state-operated program.                                                                                                         
                                                                                                                                
Senator Wilken wanted to know how the distribution of                                                                           
federal funds between the state and the Native                                                                                  
organizations was calculated.                                                                                                   
                                                                                                                                
Mr. Nordland responded that the amount of federal money                                                                         
spent on Native clients during the federal fiscal year                                                                          
1994, in the specified region, is reported to the federal                                                                       
government as the percentage of the state's block grant to                                                                      
be allocated to the Native organization. He qualified that                                                                      
the amount could change in the future when the Temporary                                                                        
Assistance for Needy Families (TANF) law changes, but would                                                                     
not change before then.                                                                                                         
                                                                                                                                
Mr. Nordland continued that the general funds provided to                                                                       
the organization are separate from the block grant funds.                                                                       
He explained further how the TANF program is funded with a                                                                      
fixed federal block grant, of which the state must expend                                                                       
at least 80 percent of what was spent in 1994 to                                                                                
participate in the TANF program without severe penalty. He                                                                      
shared that the state is currently meeting the required                                                                         
expenditure amount.                                                                                                             
                                                                                                                                
Senator Wilken asked how many families this legislation                                                                         
would affect.                                                                                                                   
                                                                                                                                
Mr. Nordland listed the TCC program currently serves                                                                            
approximately 500 families, the Tlingit/Haida organization                                                                      
serves about 500 families and ABCP would serve                                                                                  
approximately 900 families if it takes over the welfare                                                                         
program in their area. He said this represents about 20                                                                         
percent of the entire caseload in the state.                                                                                    
                                                                                                                                
Senator Wilken asked why the transfer of these 1900                                                                             
families would not make the department's operating costs                                                                        
smaller.                                                                                                                        
                                                                                                                                
Mr. Nordland responded that the department still                                                                                
administers Medicare, Food Stamps, Adult Public Assistance                                                                      
and other programs. It was difficult for him to say exactly                                                                     
how the department would manage the reduction in                                                                                
administrative funds and still operate these other                                                                              
programs. He used Bethel as an example where over 95                                                                            
percent of welfare clients are Native and the department                                                                        
would therefore reduce department staff.                                                                                        
                                                                                                                                
Senator Wilken thought the fiscal note should show a                                                                            
reduction in state bureaucracy.                                                                                                 
                                                                                                                                
Mr. Nordland responded that there is a reduction in the                                                                         
state bureaucracy but not a reduction in the budget. He                                                                         
stated that the general funds would be paid to employees of                                                                     
the Native corporations to operate the program rather than                                                                      
to state workers. He stressed that the amount of spending                                                                       
stays the same.                                                                                                                 
                                                                                                                                
Senator Wilken then asked the purpose of the legislation.                                                                       
                                                                                                                                
Mr. Nordland answered the reason for transferring welfare                                                                       
programs to Native organizations is for many of the same                                                                        
reasons for having local school districts across the state.                                                                     
That, he expressed is to have some local control with the                                                                       
programs "closer to home."                                                                                                      
                                                                                                                                
Senator Wilken asked if there would ever be an instance of                                                                      
a non-Native family not provided with services that a                                                                           
Native family is provided or visa-versa.                                                                                        
                                                                                                                                
Mr. Nordland assured that one entity or another would serve                                                                     
everyone who is eligible for public assistance.                                                                                 
                                                                                                                                
BARBARA NICKLOS, Director, Division of Child Support                                                                            
Enforcement, Department of Revenue, testified via                                                                               
teleconference from Anchorage that she was available to                                                                         
answer questions regarding the disbursement of child                                                                            
support payments to the Native organizations who operate a                                                                      
public assistance program. She assured that the language                                                                        
pertaining to this allowance does not relate in any way to                                                                      
tribal court.                                                                                                                   
                                                                                                                                
DON SHIRCEL, Director, Family Services Division, Tanana                                                                         
Chiefs Conference testified via teleconference from                                                                             
Fairbanks listing his education and experience                                                                                  
qualifications. As a social service professional, he                                                                            
strongly supported both SB 80 and HB 98.                                                                                        
                                                                                                                                
Mr. Shircel spoke in great detail of the early success of                                                                       
the TCC operated public assistance program and the                                                                              
satisfaction it has given Native leaders.                                                                                       
                                                                                                                                
                                                                                                                                
Tape: SFC - 00 #89, Side B    7:09 PM                                                                                           
                                                                                                                                
                                                                                                                                
Mr. Shircel read a letter to TCC from a former client as                                                                        
follows. [Copy not provided.]                                                                                                   
                                                                                                                                
Hello,                                                                                                                          
I'm writing this letter to everyone to let you know                                                                             
that I have a new permanent job and I'm going to be                                                                             
O.K. from here on out. I'm also writing to thank each                                                                           
person for all they have done for my family and I. I                                                                            
know that there's a lot of work that's put into each                                                                            
individual case and I really want to thank you for all                                                                          
that you've done to help me become more self                                                                                    
sufficient. This letter is not only a letter to thank                                                                           
you for all your hard work, but it's also a letter to                                                                           
request that I have my case closed. I do realize that                                                                           
all my benefits will stop and I feel I'm prepared for                                                                           
this. Once again, thank you and may Lord Jesus bless                                                                            
you for what you do to help others.                                                                                             
                                                                                                                                
Mr. Shircel expressed that he could not think of a better                                                                       
way to convey to the Committee what the legislation is                                                                          
trying to accomplish than this letter could. He believed                                                                        
that with the passage of the bill, his organization could                                                                       
have an even greater impact and get more "bang out of each                                                                      
welfare buck."                                                                                                                  
                                                                                                                                
Senator Adams asked what does TCC do for a Caucasian                                                                            
individual living in a rural community in the region, who                                                                       
otherwise qualifies for the TANF-based program.                                                                                 
                                                                                                                                
Mr. Shircel responded that currently the individual must                                                                        
apply for services through the state because TCC does not                                                                       
have the authority to serve him or her.                                                                                         
                                                                                                                                
Senator Adams asked if that qualified Caucasian has a                                                                           
choice between the Native-operated or the state-operated                                                                        
public assistance program.                                                                                                      
                                                                                                                                
Mr. Shircel answered that without this legislation, that                                                                        
person does not have a choice but must be served through                                                                        
the state-operated program.                                                                                                     
                                                                                                                                
Senator Green commented that four years ago during                                                                              
deliberations of SB 98, relating to welfare reform,                                                                             
suggestions were made to address alcohol, drug abuse,                                                                           
parent's involvement with children, and possible domestic                                                                       
violence issues conditional on receiving benefits. She                                                                          
recalled that on every count it was deemed this was a                                                                           
violation of individual freedom. She stressed that if                                                                           
allowances for these issues to be combined in the public                                                                        
assistance for the Native-operated programs, then the same                                                                      
allowances should be made for every public assistance                                                                           
program in the state.                                                                                                           
                                                                                                                                
Co-Chair Torgerson requested an improved sectional analysis                                                                     
from the department and a legal opinion on the equal                                                                            
protection clause from the Division of Legal and Research                                                                       
Services.                                                                                                                       
                                                                                                                                
Senator Green also requested a side-by-side comparison of                                                                       
the current role of the Division of Child Support                                                                               
Enforcement and the proposed interaction with the Native-                                                                       
operated programs, as it relates to TANF and how the funds                                                                      
circulate. She wanted to know if any funds would be lost if                                                                     
the legislation passed.                                                                                                         
                                                                                                                                
Co-Chair Torgerson ordered the bill HELD in Committee.                                                                          
                                                                                                                                

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