Legislature(2001 - 2002)
04/26/2001 06:17 PM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SENATE BILL NO. 193 "An Act relating to a study of the economic and social effects of the permanent fund dividend on the state." This was the first hearing for this bill in the Senate Finance Committee. Co-Chair Kelly informed that this bill speaks to a 1990 court decision on Lindly vs. Malone. Co-Chair Donley gave a history on the issue, beginning in 1988 when he sponsored legislation to change the residency requirement for the permanent fund dividend from six months to two years. He noted a clause was inserted in this bill providing that in the event a court found that two years is too long, the requirement would automatically become one year. Co-Chair Donley stated that since this time, he has learned the longest length of residency that is acceptable for a benefit qualification, according to the United States Supreme Court, is two years. He detailed the ruling, which found that in certain instances, such as with in-state tuition fees, it is acceptable to stipulate up to two years as the residency requirement to prevent exploitation from a transient population. He opined the Alaska permanent fund is a comparable benefit in its attraction. He surmised that the more lengthily two-year residency requirement could be imposed in Alaska if there was evidence that people were moving to the state for the purpose of receiving the dividend. Co-Chair Donley continued, saying that when a state court found the 1988 legislation unconstitutional, the decision was not appealed to the state Supreme Court because the state had not yet developed the necessary evidence to show that this benefit was the reason people were moving to Alaska. Co-Chair Donley pointed out the amount of the dividends are significantly higher then they were in 1988. He noted the residency requirement was doubled through the legislation from six months to one year, but that the matter of a two-year residency requirement remained unresolved. Co-Chair Donley explained that SB 193 provides that a study would be conducted to learn if it could be determined whether there is a problem with people attracted to the state because of the permanent fund dividend and if a longer residency requirement is justified. Senator Austerman inquired about the Longevity Bonus Program, which provides subsidies to elderly Alaskan residents, and if this program is in the process of being phased out. Co-Chair Donley affirmed. He noted the original legislation of 1988 increased the residency requirement for this program as well, but that this is no longer an issue since the program no longer accepts new participants. Co-Chair Donley moved to adopt CS SB 193, 22-LS0828\J as a working draft. There was no objection and the committee substitute was ADOPTED. Amendment #1: This conceptual amendment replaces "general fund" with "permanent fund earnings account" in Section 2 on page 2 line 2 of the committee substitute. The amended language reads as follows. The sum of $200,000 is appropriated from the permanent fund earnings account to the Legislative Council for a study of the economic and social effects of the permanent fund dividend on the state. Senator Leman commented that a permanent fund account, rather then the general fund, is normally used when addressing legal matters regarding the permanent fund and would be appropriate in this legislation as well. Senator Leman moved for adoption of the amendment. Senator Ward objected. There was some question as to the specific name of the fund and the Division of Legislative Finance was requested to supply the correct information. Senator Wilken wanted to ensure the correct fund account was inserted into the language. The bill was HELD in Committee until later in the meeting. SENATE BILL NO. 193 "An Act relating to a study of the economic and social effects of the permanent fund dividend on the state." [This bill was held earlier in the meeting. A motion to adopt Amendment #1 was on the table.] Senator Leman moved to amend his amendment to change the funding source from the permanent fund earnings account to permanent fund corporate receipts. The amended language reads as follows. The sum of $200,000 is appropriated from the permanent fund corporate receipts to the Legislative Council for a study of the economic and social effects of the permanent fund dividend on the state. Senator Leman explained the change to the funding source as recommended by the Division of Legislative Finance. Senator Ward removed his objection to the adoption of the amendment. The amendment was AMENDED and ADOPTED without objection. Amendment #2: This conceptual amendment deletes "the preparation of" proceeding "a study of" from Section 1. LEGISLATIVE INTENT. On page 1, lines 8 and 9 of the committee substitute. The amended language reads as follows. The legislature intends that the Legislative Council, in consultation with the Department of Community and Economic Development, the Department of Health and Social Services, and the Department of Labor and Workforce Development, use the appropriation made in sec. 2 of this Act to contract for a study of the economic and social effects of the permanent fund dividend on the state. Co-Chair Kelly moved for adoption and explained this allows the state to contract with a private organization to complete the study. Without objection, the amendment was ADOPTED. Senator Green offered a motion to move CS SB 193, 22-LS0828\J, as amended from Committee with new Legislature fiscal note for $200,000. The bill MOVED from Committee without objection. AT EASE 8:46 PM / 8:46 PM
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