Legislature(2021 - 2022)SENATE FINANCE 532
05/13/2021 01:00 PM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB69 || HB71 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 69 | TELECONFERENCED | |
| += | HB 71 | TELECONFERENCED | |
CS FOR HOUSE BILL NO. 69(FIN) am(brf sup maj fld)(efd fld)
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs; capitalizing funds; amending
appropriations; and making capital appropriations,
supplemental appropriations, and reappropriations."
CS FOR HOUSE BILL NO. 71(FIN) am
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; making
supplemental appropriations; and providing for an
effective date."
3:10:16 PM
Co-Chair Stedman relayed that the committee would consider
the Senate committee substitutes for HB 69 and HB 71. He
explained that the bill came from the other body and would
supplant the budget bill that the committee had previously
discussed.
Co-Chair Bishop MOVED to ADOPT proposed committee
substitute for CSHB 69(FIN) am(brf sup maj fld)(efd fld),
Work Draft 32-GH1509 (Marx, 5/13/21).
Co-Chair Stedman OBJECTED for discussion.
Co-Chair Stedman asked staff and the Office of Management
and Budget (OMB) director to come to the table. He noted
that some of the information that would be discussed would
be new and some had been previously discussed.
NEIL STEININGER, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, referenced an OMB packet in
members' files titled "OMB Packet 1-5" (copy on file). The
first document in the packet was a memorandum dated May 3rd
[from his office addressed to the co-chairs of the Senate
Finance Committee and House Finance Committee]. He noted
that a couple of the items had been previously discussed by
the committee and a couple were newer amendments
transmitted to the legislature for consideration.
Mr. Steininger moved to a spreadsheet on the second page of
the packet [titled "FY2021 Operating Supplemental Governor
Amended"]. The first item was authority for the Mt.
Edgecumbe Boarding School to accept some of the incoming
federal COVID-19 relief money. He explained that most of
the incoming federal revenue for districts was routed
through the Department of Education and Early Development
(DEED); however, money for Mt. Edgecumbe was received
directly by the school. The second item was $410,000 for
judgements, settlements, and claims. The third item was a
reappropriation of $5.5 million from aviation state match
to the Marine Highway System Fund. He explained that the
Alaska Marine Highway System (AMHS) revenues were collected
in the Marine Highway System Fund. He detailed that there
had been a significant revenue shortfall due to COVID-19,
resulting in a projected negative fund balance. He
elaborated that the Federal Aviation Administration (FAA)
had waived the match requirements on the airport
improvement program, freeing up a significant amount of
general funds that would have been used to match the
federal revenues.
3:14:14 PM
Senator von Imhof pointed to the language column labeled
"Lang" that showed a "Y" for each of the three items
discussed by Mr. Steininger. She asked for verification the
column indicated the three items were included in the
committee substitute language section.
PETE ECKLUND, STAFF, SENATOR BERT STEDMAN, responded
affirmatively.
Mr. Steininger moved to a memorandum labeled document "2"
dated May 3, 2021. He noted that the previous items
discussed were supplemental effective date items. He
clarified that document 2 pertained to FY 22 operating
budget items. He turned to a spreadsheet showing three
items on the fourth page of the packet [titled "FY2022
Operating Governor Amended"]. The first item was an
adjustment to the cost of living adjustment (COLA) for
court services officers and deputy fire marshals in the
amount of $300,000 undesignated general fund (UGF) and
$317,000 all funds. Item 2 was an increase to the
investment management fees for the Alaska Permanent Fund
Corporation (APFC) as a result of higher than anticipated
returns. He elaborated there was a larger fund balance
being managed; therefore, the management fees, which were
generally negotiated on a percentage of the assets under
management, had increased.
Mr. Steininger addressed item 3 on the spreadsheet. The
item pertained to three positions within the Department of
Transportation and Public Facilities (DOT) at a total of
$343,700 funded through federal revenues. He explained the
positions were necessary in order to meet reporting
requirements of some of the federal relief funds received
by DOT if the department utilized the funds in its
operating budget.
3:16:13 PM
Senator von Imhof pointed to the language column labeled
"Lang" that showed a "N" for each of the three items
discussed by Mr. Steininger. She asked if the three items
were not included in the committee substitute.
Alternatively, she wondered if the "N" indicated the items
were included in the numbers section of the committee
substitute.
Mr. Steininger replied that the column indicated the items
were included in the numbers section of the bill; however,
he could not speak to whether the items were included in
the committee substitute.
Senator von Imhof surmised that the spreadsheet likely
indicated the items were in the previous bill. She asked
for verification that "it was within walking distance of
this new bill."
Mr. Steininger responded affirmatively. He explained that
the document had been prepared when OMB transmitted the
governor's budget amendments to the legislature. He
clarified that the bill page and line references in the
spreadsheet pertained to the governor's original budget. He
noted it was likely a slightly different page and line in
the committee substitute.
Mr. Steininger moved to page 5 showing a spreadsheet
labeled "FY2022 Governor Amended Operating - Salary
Adjustments." He explained that the spreadsheet pertained
to two items that were reflected as several hundred
individual transactions in the budget system. The items
reflected salary negotiations with the Supervisory Unit [of
the Alaska Public Employees Association (ASEA)] and the
Alaska Correctional Officers Association. He elaborated
that both negotiated a 3 percent COLA in FY 22. The total
cost for the Supervisory Unit was $8.1 million. He detailed
that $2.8 million of the total was covered by UGF. The
total cost associated with the Alaska Correctional Officers
Association was $3.3 million, with $3 million of the total
covered by UGF. The third item on the spreadsheet was a
language amendment to the salary and other benefit
adjustments section in the language section of the
operating budget to reflect the negotiations.
3:18:17 PM
Mr. Steininger moved to a spreadsheet on page 7 labeled
"FY2021 Capital Supplemental Governor Amended," also
associated with items listed on memorandum 1. The first
item was the opposite side of the reappropriation of
aviation state match to the Marine Highway System Fund [the
other side of the reappropriation was previously discussed
and shown on the spreadsheet titled "FY2021 Operating
Supplemental Governor Amended"]. The item reflected the
reduction in the state match required, which balanced out
to the increase in the deposit into the Marine Highway
System Fund. Item 2 was $11 million in FAA Coronavirus Aid,
Relief, and Economic Security (CARES) Act funding for rural
airport deferred maintenance projects. Item 3 was $30
million for the Alaska international airport system to
enable the use of federal COVID-19 relief revenues to pay
off debt service. Item 4 was a reappropriation of $1
million of the aviation state match for emergency weather
events. He explained that sometimes there were large-scale
weather events outside the capacity of DOT to accommodate
within the normal operating budget and required
supplemental appropriations. The item was a capital
appropriation to DOT for use in response to an extreme
weather event in the future.
Senator Hoffman pointed to the "Bill Number" column on the
spreadsheet and observed the bill listed was SB 68. He
asked what SB 68 was and if the spreadsheet should read
"69" instead.
Mr. Steininger replied that SB 68 and HB 84 were the
capital budgets. He explained that the amendments were
intended to modify the governor's original capital budget.
He believed there may be action on the items in the
committee substitute.
Senator Hoffman asked for verification that the action
would remove the items from the capital budget and place
them in the operating budget.
Mr. Ecklund agreed it was the case for the reappropriation
for the Marine Highway System Fund and the weather event.
He clarified that the international airport system debt
service payment was not yet included in the committee
substitute. He would have to follow up with the committee
regarding the rural airport deferred maintenance projects,
which may have been added to the supplemental section of
the committee substitute.
Mr. Steininger relayed that he had concluded reviewing the
items.
3:21:38 PM
Mr. Ecklund referenced a document dated May 13, 2021
showing changes to SB 49 version N (copy on file). The
document showed changes from the prior bill version
referred to as "CS 1" recently adopted by the committee.
Mr. Ecklund reviewed the changes shown in the document
beginning with item 1 pertaining to the University of
Alaska. He detailed that the committee substitute deleted
and replaced supplemental university language relating to
$42.7 million going to the university from the higher
education emergency relief funds II and III. Additionally,
there was $!9.985 million for the university from higher
education emergency relief funds for student aid.
Mr. Ecklund highlighted item 2, a new capital supplemental
section item relating to supplemental insurance claims.
Item 3 was a modification of the REAA section. He
elaborated that the previous bill version included a sum
certain $34,238,000 for the item. The committee substitute
changed the language to read "estimated to be $34,238,000"
and referred to the statutory formula. Item 4 was a cleanup
to a DOT supplemental and deleted "Fairbanks" from a
nonurbanized area appropriation. Item 5 amended the FY 22
salary and benefits to include two of the new contracts
previously mentioned by Mr. Steininger (items 7 and 8) for
the Alaska Correctional Officers Association representing
correctional officers and the Alaska Public Employees
Association representing the Supervisory Unit.
Mr. Ecklund moved to item 6, an operating supplemental item
of $5.3 million from the Elementary and Secondary School
Emergency Relief Fund for the Mt. Edgecumbe Boarding
School. Item 7 was an update to the judgements and claims
section with the correct dollar amount. Item 8 corrected
the placement of the Marine Highway System Fund
reappropriation in the bill. The item was moved to the fund
transfers section of the bill and was modified to $5.5
million. Item 9 was $1 million of a reappropriation for
emergency weather events. Item 10 included the various
salary adjustments appearing throughout the bill to
implement new contracts (discussed earlier in the meeting).
Item 11 was a $60 million increase in management fees for
APFC.
Mr. Ecklund moved to item 12, which added $343,000 in
federal receipts for three long-term nonpermanent positions
to help manage the workload related to all of the federal
relief funding coming into DOT. He highlighted fund source
swaps pertaining to DOT. There was a fund source swap of
slightly over $17 million from UGF to various federal
highway Coronavirus Response and Relief Supplemental
Appropriations Act (CRRSAA) funds, CARES Act funds, and FAA
CRRSAA funds. He noted the fund source swap had been
proposed by the executive branch. There was a fund source
swap of $1.9 million UGF replaced with CRRSAA Federal
Highway Administration (FHWA) funds as part of the 18-month
Alaska Marine Highway System plan.
Mr. Ecklund addressed item 13, an addition to the Public
Defender Agency of $1.35 million. He noted there had been a
Department of Law (DOL) request approved earlier in the
budget process that added ten new prosecutor positions and
associated support staff. He elaborated that the addition
to the Public Defender Agency was to help maintain parity
with DOL. Item 14 added just over $1 million for trial
courts within Judiciary to meet increased demands on the
court systems. He briefly pointed to technical fixes made
by the Legislative Finance Division at the bottom of page 5
of the summary of changes.
3:27:47 PM
Senator Hoffman referred to item 13 and the addition of
seven full-time positions for the Public Defender Agency,
while ten prosecutor positions had been added to DOL. He
asked if it was considered parity.
Mr. Ecklund replied that could not answer the question.
Senator Wilson addressed Senator Hoffman's question and
thought some of the funds for the Public Defender Agency
were for contract attorneys for conflict cases. He did not
believe DOL had the same capability. He thought there could
be parity within the seven to ten ratio.
Co-Chair Stedman WITHDREW his OBJECTION. There being NO
further OBJECTION, Work Draft 32-GH1509 (Marx, 5/13/21) for
CSHB 69(FIN) am(brf sup maj fld)(efd fld) was ADOPTED.
3:29:30 PM
Co-Chair Bishop MOVED to ADOPT proposed committee
substitute for CSHB 71(FIN), Work Draft 32-GH1508/O (Marx,
5/13/21).
Co-Chair Stedman OBJECTED for discussion.
Mr. Ecklund explained that the committee substitute was
almost identical to the previous bill version. The
committee substitute added salary adjustments from the
approved contracts.
Co-Chair Stedman WITHDREW his OBJECTION. There being NO
further OBJECTION, Work Draft 32-GH1508/O (Marx, 5/13/21)
for CSHB 71(FIN) was ADOPTED.
CSHB 69(FIN) am(brf sup maj fld)(efd fld) was HEARD and
HELD in committee for further consideration.
HB 71(FIN) am was HEARD and HELD in committee for further
consideration.
Co-Chair Stedman reviewed the schedule for the following
day.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 71 work draft version O.pdf |
SFIN 5/13/2021 1:00:00 PM |
HB 71 |
| HB 69 work draft version F.pdf |
SFIN 5/13/2021 1:00:00 PM |
HB 69 |
| HB 69 OMB Packet 1-5.pdf |
SFIN 5/13/2021 1:00:00 PM |
HB 69 |