Legislature(1995 - 1996)
04/11/1995 06:20 PM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
CS FOR HOUSE BILL NO. 100(FIN) An Act making appropriations for the operating and loan program expenses of state government, for certain programs, and to capitalize funds; making appropriations under art. IX, sec. 17(c), Constitution of the State of Alaska, from the constitutional budget reserve fund; and providing for an effective date. Upon convening the meeting, Co-chairman Frank announced that the committee would commence review and adoption of subcommittee budgets at this time and continue subcommittee presentations the following evening. He further advised that the subcommittee for the Dept. of Transportation and Public Facilities had not yet concluded its work and that the budget for the Dept. of Fish and Game would not be presented at this time. DEPT. OF EDUCATION Co-chairman Frank directed attention to a handout (copy appended to these minutes as Attachment A. Additional information on all subcommittee presentations is included in the Senate Finance Committee master file for HB 100, available through the Legislative Finance Division.). He explained that the handout contains the subcommittee report and noted that the cover sheet evidences the following changes from the Governor's budget: School Finance Division - Reduced the school bus safety program but maintained the inspection program. Reduced the division director to range 24, and reduced excess contractual funding. Education Support Program - Made a general reduction of $10.0 for personal services, eliminated close-up, future problem solving, student leadership, and the rural school voc. ed. program. Executive Administration - Reduced a special assistant to range 21, eliminated an education associate III position, reduced general funds and suggested that the division collect interagency receipts for services from other divisions. Commissions and Boards - Eliminated excess general funds, denied increments for contractual and personal services, but maintained ability to capture federal funds. The Co- chairman referenced need for a technical amendment included within Amendment No. 1. Co-chairman Halford MOVED for adoption of Amendment No. 1. DANA LaTOUR, fiscal analyst, Legislative Finance Division, explained that the amendment merely corrects the funding. The net effect is zero. No objection having been raised, Amendment No. 1 was ADOPTED. Kotzebue Technical Center - A general reduction of 8%, ($65.1) was taken. Mt. Edgecumbe Boarding School - An increment to be achieved through transfer from boarding home grants was denied based on the expectation that the school could continue to be operated in the residential program with the current level of funding. Alaska Vocational Technical Center - A general reduction of $100.0 was made with intent language saying that the center should aggressively develop additional program receipts and seek authority to receive and expend them through the Legislative Budget and Audit Committee. A corresponding personal services reduction of $8.8 was also made for a division director. Vocational Rehabilitation - The small business enterprise increment was reduced based upon an expectation that the project may not receive that much in program receipts. If the total of anticipated receipts is forthcoming, the division may come to the Legislative Budget and Audit Committee to receive and expend them. A reduction was also made to division directors in line with the recommendation from the administration. Excess program receipt authority was also eliminated in the Americans With Disabilities section. Alaska State Library - An administrative assistant and librarian were eliminated, and travel, supplies, and grants were reduced as was the range for a division director. An additional library assistant in archives was also eliminated. Alaska State Museums - The museum security coordinator was eliminated, and travel, contractual, and supplies were reduced. Alaska Postsecondary Education Commission - Co-chairman Frank referenced last year's policy of allowing no new students in the WICHE program. Funding for FY 96 follows through on that policy by denial of the $144.9 increment. That maintains the commitment to students already in the program but allows no new students. The subcommittee denied the transfer from WICHE to WAMI. A bill is presently before Senate Finance Committee with an amendment to increase fees collected from students to maintain the WAMI program. The budget denies the increase in federal student aid grants as a transfer from WICHE. Senator Rieger raised a question regarding a $105.0 transfer from WICHE and the $39.3 labeled "correct transfer from WICHE." Co-chairman Frank advised that the department said it had excess funds in WICHE that it wished to transfer to WAMI and federal student aid. The department wanted to increase federal student aid grants. The subcommittee did not see fit to do that. The plan is to statutorily change ability to collect fees from WAMI students. Co-chairman Halford raised a question concerning federal loans and forgiveness available to doctors willing to practice in rural areas. Co-chairman Frank explained that the subcommittee did not "get into that specifically." He noted that both Senator Salo and Senator Green are "interested in looking at this area over the interim." Responding to a comment by Co-chairman Halford that $150.0 was passed off to the capital budget, Co-chairman Frank noted that library acquisition moneys are traditionally funded in the capital budget. While those moneys are not in the Governor's capital budget this year, the subcommittee recognized need for ongoing subscriptions and acquisition of periodicals and books. It is appropriate that this effort have some level of funding. Intent language was thus provided. Co-chairman Frank next directed attention to the following intent: Alaska Council on the Arts - Requests that the council maximize grants and minimize overhead. Library Operations - Requests consideration of $150.0 for acquisitions within the capital budget. Vocational Rehabilitation - Directs that the division request receipt and expenditure authority from the Legislative Budget and Audit Committee if additional federal receipts are forthcoming. Alaska Vocational Technical Center - Speaks to program receipt authority per the preceding paragraph. Co-chairman Halford MOVED for adoption of intent language. No objection having been raised, the INTENT was ADOPTED. Co-chairman Halford then MOVED for adoption of the subcommittee recommendation for the Dept. of Education, excluding formula funding. Co-chairman Frank acknowledged that funding of the formula would be dealt with at another time. No objection having been raised, the subcommittee budget for the Dept. of Education was ADOPTED for incorporation within HB 100. DEPT. OF CORRECTIONS Co-chairman Frank directed attention to a handout (Attachment B) and explained that working from FY 95 authorized, the subcommittee made the following changes: Administration and Support - Effected a transfer of $387.7 to the Dept. of Administration for a building lease in Anchorage, fully implemented telecommunications chargebacks, allowed an increment for transportation unit overtime and allowed a partial increment for the correctional academy to train new staff and recruits. Statewide Operations - Included an increment of $1.5 million in inmate health care, allowed partial increments for inmate programs and correctional industries, included an increment of $4,798.7 in out-of-state contractual for 200 beds in Arizona, included an increment of $725.9 for an anticipated inmate population increase, allowed an increment of $1.3 million to reduce vacancy from an average of 5.5% to 3.3%, and included an increment on the telecommunications chargeback. Co-chairman Frank referenced a general fund offset of $2.7 million from SB 135. Addition changes include annualization of funding for 50 new beds at the Spring Creek Correctional Center, 59 new beds at Wildwood, and funding for new CRC beds in community corrections. A corresponding offset was made through upper level management salary reductions. Community Jails - Co-chairman Frank referenced transfer of the component from the Dept. of Public Safety to the Dept. of Corrections. The subcommittee authorized one additional person to administer contracts and provided a partial one- half increment in negotiated contracts. Co-chairman Frank called for questions or comments on the budget proposal. Senator Donley referenced a request from Senator Lincoln for a proposed amendment relating to community jails, to partially approved renegotiated contracts. Co-chairman Frank asked that amendments be held for consideration following presentation of all subcommittee budgets. Senator Randy Phillips MOVED for adoption of the subcommittee report on the Dept. of Corrections budget. No objection having been raised, the subcommittee report was ADOPTED for incorporation within HB 100. Senator Phillips next MOVED for adoption of the following intent: Inclusion of $155.8 in fire and safety equipment for community jails within the capital budget. Review of travel, per diem, and pay for new recruits at the correctional academy in an attempt to reduce expenditures. Acknowledgment that funding of $2,703,700 from denied dividends from the permanent fund (SB 135) would be one-time funding and thereafter leave a gap in FY 97 funding for statewide operations that would have to be filled in that budget. Senator Donley raised questions regarding the last item of intent, noting that SB 135 has not yet passed. Co-chairman Halford advised that the intent provides justification to the Office of Management and Budget for inclusion of the funding in the base for the FY 97 budget. No objection having been raised, the foregoing intent for the Dept. of Corrections budget was ADOPTED for incorporation within HB 100. DEPT. OF LABOR Subcommittee Chairman, Senator Phillips, advised that the Senate general fund allocation for the budget totaled $9,133.5. The subcommittee recommendation is slightly lower at $9,097.2. That represents a reduction of five positions. He next spoke to the following general fund reductions: Data Processing $ 89.2 State Data Center (one-half of increment) 80.0 OSHA, GF non-match 276.4 OSHA, federal program resale 182.3 OSHA, publication technician 26.4 OSHA, sale of federal publications 5.8 Total reduction from the Governor's Budget $660.1 Senator Phillips advised that the foregoing represents a $280.5 reduction from FY 95. Senator Donley inquired concerning the impact of cuts upon OSHA. JERRY BURNETTE, aide to Senator Phillips, advised that "It reduces the state's match to OSHA." Only federal moneys remain. Senator Donley voiced concern that the federal government would take over if the state does not do an adequate job. Senator Phillips advised that with existing caps, there was no other way to proceed. Senator Donley attested to concern regarding worker safety on the job and asked that someone from the department speak to the issue. No one came forward. The Senator again cautioned that funding below a certain threshold would result in federal take over and stressed need to hear from the department. Co-chairman Frank suggested that the subcommittee recommendation be adopted with the understanding that consideration would revert to it with an opportunity for amendment if necessary. Co-chairman Halford MOVED for adoption of the subcommittee recommendation for the Dept. of Labor budget. Senator Donley OBJECTED, noting that a minority member of the subcommittee, Senator Zharoff, was not present to articulate concerns. Co-chairman Frank directed that the budget be held for consideration at the next meeting. Co-chairman Halford withdrew his motion for adoption. DEPT. OF MILITARY AND VETERANS AFFAIRS Senator Phillips distributed a handout (Attachement D) and advised that the Senate general funding allocation was $6,785.8. The subcommittee budget represents an $88.5 reduction from FY 95 and a reduction of one position. Reductions consist of: Delete funding for disaster relief $6,000.0 (Funding is considered formula and will be dealt with later.) Delete veterans increment in Commissioner's Office 45.0 (Leaves funding for new spec.assist. for veterans affairs.) Delete increment for rural veteran outreach 30.0 (This was a new program requested by the Governor.) Delete grant for American Red Cross 75.0 (One-time grant, FY 95.) Reduced general fund in ADES 30.0 (Reduced travel and staff development.) Reduce general fund in Commissioner's Office 30.0 (Replace with $30 federal authorization.) Reduce general fund in Army Guard 83.7 (Close Mountain View Armory, maintenance shortfall) Reduce veterans service officer grant program 25.0 Total reductions $6,318.7 Co-chairman Halford voiced his understanding that the budget increased federal receipts while reducing general funds. Senator Phillips concurred. Jerry Burnette advised that the department testified that it thought it would be able to capture the federal funds. Senator Phillips further advised that he sought to include the new position for veterans affairs as a range 21 special assistant rather than a range 26 director. Senator Phillips MOVED for adoption of the subcommittee recommendation for the budget for the Dept. of Military & Veterans Affairs. No objection having been raised, the budget was ADOPTED for incorporation within HB 100. UNIVERSITY OF ALASKA Senator Rieger explained that in keeping with Senate practice over the last few years, the regents and the university administration would prefer to work with an unallocated reduction. That reduction has been administered fairly in the past. The subcommittee recommendation is thus to take the assigned cap as an unallocated reduction from the Governor's recommendation. The statewide FY 96 number would thus be $167,412.2. Senator Rieger next directed attention to intent relating to development of the health sciences curriculum at the UAA campus. Co-chairman Halford asked if intent containing reference to WAMI was consistent with the Dept. of Education budget. Co-chairman Frank voiced his understanding that it is not inconsistent. He stressed need to get WAMI on a paying basis by increasing fees from students. That does not impact intent within the University of Alaska budget. Senator Rieger noted that the health sciences curriculum goes beyond WAMI. He advised that it also provides one of the opportunities for research, an important component for all campuses. Intent would encourage development of research at the UAA campus. Senator Rieger MOVED for incorporation of the subcommittee recommendation for the University of Alaska budget within HB 100. No objection having been raised, IT WAS SO ORDERED. Dept. of Community and Regional Affairs Senator Phillips advised that the Senate general fund allocation was $30,456.0. The subcommittee is lower at $30,425.4. The reduction from FY 95 is $2,678.2 and five positions. Reductions consist of: Alaska Legal Services (eliminate grant) $ 421.0 Admin. Services (personal services reduction) 77.0 Commissioner's Office (eliminate designated grants) 576.9 Local Gov. Assistance (personal services reduction) 126.9 Local Gov. Assistance (travel reduction) 25.0 Local Gov. Assistance (eliminate AFN grant) 145.0 Child Care (pers.serv.reduction two grant administrators) 125.0 Child Care (grantee training) 20.0 Day Care Assistance (deny increment) 400.0 Rural Development Mini Grants (grant reduction) 150.0 Rural Development Assist.Grants (grant reduction) 251.3 Community Development (personal services) 86.3 Community Development Circumpolar (eliminate grant) 75.0 Community Development CDQ (eliminate grant) 25.0 Community Development, DC&ED, CDQ (deny increment) 32.6 Community Development, BSFA/CDQ (deny increment) 100.0 Community Development,contractual (line item reduction) 7.0 Energy Operations (personal services reduction) 238.1 Energy Operations (reduction of contractual line) 30.0 Total reductions from Governor's Amended $2,909.5 Senator Phillips advised that senior citizen tax relief, municipal assistance, and revenue sharing would be dealt with differently. Co-chairman Frank concurred that those items would be handled in full committee at a later time. Co-chairman Halford voiced his understanding that CDQ funding was reduced but not eliminated. LaMAR COTTON, Dept. of Community and Regional Affairs, advised of $281.0 for needed positions. The $30.0 which was eliminated was a special grant increment requested by the Dept. of Commerce and Economic Development. The $25.0 was an unspecified grant. Funding allowing continuation of the program remains in the budget. Senator Donley registered concern on behalf of Senator Adams regarding deletion of funding for Alaska Legal Services. He then referenced a possible amendment to restore funding and asked that that item of the budget be held open. Co- chairman Frank voiced a preference for adoption of the subcommittee report with opportunity to offer amendments at a subsequent meeting. Senator Phillips MOVED for incorporation of subcommittee recommendations for the budget for the Dept. of Community and Regional Affairs within HB 100. No objection having been raised, IT WAS DO ORDERED. End: SFC-95, #27, Side 1 Begin: SFC-95, #27, Side 2 DEPT. OF COMMERCE AND ECONOMIC DEVELOPMENT Senator Sharp advised that the subcommittee met the general fund spending cap of $37,448.7. Changes include: Insurance - Approved $164.6 GF/PR increment and denied increment of $356.6 GF/PR. Alaska Public Utilities Commission - Deleted two analysts, $119.9, and denied increment of $93.2. Commissioner's Office - Deleted special assistant I, $69.1. Economic Development - Reduced ARDORs $400.0, reduced "Marketing Alaska" $50.0, and denied $74.2 increment. International Trade - Reduced a director from range 26 to range 24, $15.0, and reduced funding for the Northern Forum by $35.0. Fish Enhancement Tax - Reduced to equal receipts and moved from the department budget to the front section. Tourism Development- Deleted $200.0 for visitor statistics (end of a three-year program) and denied transfers. Alaska Tourism Marketing Council - Increased marketing by $1 million and reduced $277.6 in excess general fund program receipts. Alaska Seafood Marketing Institute - $200.0 reduction in general fund match from $1 million to $800.0 to match $6 million in federal funding down from $7 million. The subcommittee also effected a $1.2 million reduction in general fund program receipt authority and a reduction of $860.0 in general fund program receipts for the Off-shore Processor Tax, since funding is not likely to be forthcoming in FY 96 due to ongoing litigation. An additional $200.0 reduction was made in Seattle personal services. The subcommittee took exception to the fact that over half the staff is located in Washington State. Intent requests that ASMI consider moving those people back to Alaska. The total general fund reduction is $2,462.0. Total general fund is $37,086.1. Senator Rieger asked if general funds remain in the ASMI budget, aside from voluntary assessments. Senator Sharp responded, "$800.0." Senator Rieger asked if voluntary assessments could be used for match moneys. Senator Sharp said he was unsure. He subsequently advised that fish tax moneys are "passed through by statute." Co-chairman Halford voiced concern over the increase in the tourism budget, noting that general funds were increased here while the budget for ASMI was decreased. He voiced his belief that both are nonresident-owned, "outside-based industries that we get a piece of." However, the state never "seems to get enough of either one of them." He suggested it was inconsistent to cut one and increase the other. Senator Phillips suggested that the department budget be closed with the exception of both the Alaska Tourism Marketing Council and Alaska Seafood Marketing. Co- chairman Frank called for objections to adoption of the subcommittee report for the Dept. of Commerce and Economic Development while holding ATMC and ASMI open. No objection having been raised, the Dept. of Commerce and Economic Development budget with the exception of ATMC and ASMI was ADOPTED for incorporation within HB 100. DEPT. OF REVENUE Senator Sharp distributed a handout (Attachement H). He then advised of the following changes from FY 95: Child Support Enforcement - Increased general funds by $164.7 to match $1,159.5 in federal funds. Income and Excise Audit - Effected an $87.6 miscellaneous reduction because the department wished to increase funds to child support enforcement and treasury. Oil and Gas Audit - Deletion of $155.3 in miscellaneous and contractual to increase funds for child support enforcement and treasury. Oil and Gas Litigation Audit - Reduction of $265.0. FY 95 funds were transferred to income and excise audit and oil and gas. Treasury Management - Received an increment of $278.4 because of the increased cost of custodial fees. The subcommittee denied the $94.1 for the bond advisor increment. Charitable Gaming - Effected a reduction of $8.2 by reducing the director position from range 26 to 24. Commissioner's Office - Provided a $90.3 increase to allow deletion of oil and gas tax review case funding. Oil and Gas Tax Case Review - The subcommittee worked with the Commissioner and staff to delete the $292.8. The Senate cap was met with a reduction of $275.0. Directing attention to the second page of the handout, Senator Sharp noted that substantial increments are all non- general fund. He then highlighted the following changes: Child Support Enforcement - Increase of federal funds of $2.6 million. Alaska Permanent Fund Corporation - Increase of $6.4 million for portfolio management. Greater investment in equities requires more active management. Alaska Housing Finance - Reduction of $2.5 million in corporate receipts and a reduction of twenty-nine positions. Alaska Mental Health Authority - Increase of $952.8 to fully fund the new board's request. Alaska State Pension Investment Board - Increase of $2.5 million for fund handling. Additional funding totals $9.3 million. Senator Rieger asked what the House did in terms of treasury management to produce "such a low number." Senator Sharp advised that the House proposes "taking several hundred thousand dollars out of the CBR." Senator Sharp MOVED for adoption of subcommittee recommendations on the Dept. of Revenue budget for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. DEPT. OF ENVIRONMENTAL CONSERVATION Co-chairman Frank directed attention to pages 2 and 3 of the subcommittee report (Attachment I) and advised of the following changes: Office of the Commissioner - Effected a general fund reduction of $140.0. Information and Administrative Services - Reduction of $100.0. Public Services - This component was combined with a new component. Regional management was eliminated but response funds remain in tact. Response Fund Administration - Reduced funds for DMVA by $100.0 to the level the department said it could live with, $500.0. Eliminated funds for the hazardous substance spill technology review council since it is sunsetting. Regional Management - Reduced funding by $262.3 and added $45.5 and $90.0 to public services (above). Environmental Quality - Eliminated $69.8 in general funds and $25.0 in general fund program receipts for a total of $94.8. Monitoring and Lab Support - Effected a reduction of $187.7 in general funds and provided intent relating to use of interagency receipts of $211.0. Drinking Water - Effected a general reduction of $30.9. Wastewater & Water Treatment - Effected a general reduction of $56.8. Solid and Hazardous Waste Management - Made a general reduction of $85.4 plus denial of the increment for solid waste. Air Quality Management - Made a general reduction of $66.7 and denied the increment of $1.1 million. Water Quality Management - Made a general reduction of $34.1. Environmental Health BRU - Effected an unallocated reduction of $111.0. Facilities & Construction - Made a general reduction of $75.0 and a shift of $93.7 to CIP funds. Co-chairman Frank advised that many of the subcommittee changes are consistent with those made by the House. Senator Donley attested to concern regarding air quality mandates and suggested that an amendment might be forthcoming. He expressed further concern regarding funding in the underground storage tank program, saying that while it is authorized to come from response funds and the spill settlement, it is instead funded from the 3-cent surcharge (general funds). That also may be the subject of an amendment. Co-chairman Halford MOVED for adoption of subcommittee recommendations for the Dept. of Environmental Conservation budget for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. Senator Phillips inquired concerning intent language. Co- chairman Frank directed attention to the following items: Environmental Quality, Laboratory Support Component Intent requests that staff finish projects currently under way and replace matching funds with interagency receipts. Environmental Quality, Air Quality & Solid Waste Intent requests that the department reassess requested positions to reduce them to the absolute minimum and then seek authority from Legislative Budget and Audit. Environmental Quality, Water Quality Intent requests that the department make certification of wetland permits a priority. The Co-chairman explained that in including intent regarding air quality he sought to give the new commissioner adequate time to reassess staffing. He questioned need for ten new positions in addition to the present forty-three and suggested that the job could be done with existing staff. Co-chairman Frank stressed need to retain primacy. That should be done with the greatest efficiency, the least amount of people, and the smallest fees on the private sector. Senator Phillips MOVED for adoption of the foregoing intent for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. Co-chairman Halford restated his motion for adoption of the subcommittee report on the budget for the Dept. of Environmental Conservation, including intent. No objection having been raised, IT WAS SO ORDERED. DEPT. OF NATURAL RESOURCES Co-chairman Frank directed attention to page 2 of a handout (Attachment J) and advised of the following changes: Administrative Services - Deleted two accountants and an assistant director. Recorder's Office - Deleted a range 18 assistant state recorder. Information Resources Management - Effected a reduction requested by the Governor, after submission of his budget, reducing program receipts by $300.0. Made a reduction in general funds and a corresponding increase to interagency receipts. Resource Development, Land - Made a miscellaneous general fund reduction and a corresponding CIP reduction of $407.0 requested by the administration. Forest Management - Effected a general reduction of $100.0. Oil and Gas Development - Made a general reduction of $100.0 for presale analysis. The Co-chairman said he would subsequently offer an amendment to change the reduction from presale analysis to a general reduction to maximize flexibility. Geological Development - Effected a general reduction of general funds in the director's office and a reduction in general fund program receipts due to an unrealized level of receipts. Water Development - Made a general reduction and eliminated the navigability project that should be handled by the division of lands. Pipeline Coordinator - Funding for Badami was changed from general fund program receipts to other funds. Information Resource Management - Funding was transferred to the management and administration BRU. Agricultural Development - Made a general reduction in program receipts and effected an $80.0 increase from the agricultural revolving loan fund. Effected a straight general fund reduction of $80.0 from the director's office, shifted $48.9 to the agricultural revolving loan fund, and reduced the appropriation authorization for collateral protection from the agricultural revolving loan fund by $239.0. An additional $100.0 for the Northern Latitude Plant Center was shifted from general funds to the agricultural revolving loan fund, and permitting funds for the Fort Knox Gold Mine and Valdez Creek were shifted to other funds. Funding for the inter-departmental data processing chargeback and the Fairbanks Office Building chargeback were transferred to the management and administration BRU. Parks and Recreation - Effected an overall reduction of $104.1 in the director's office and authorized program receipt authority and "then we took half of it back in general funds . . . ." Agricultural Development BRU - Transferred funding to the development BRU along with forest, oil and gas, mining, geological and water development. Fire Suppression - Funded an amount of fixed cost, recognizing that a supplemental would accommodate funding needs for actual fires once that need is known. The Co- chairman advised that he would later offer an amendment to change the format to one preferred by the department, to provide greater flexibility. Co-chairman Frank next directed attention to the following intent: Parks and Recreation Management - Requires that if parks are closed, closure occur in a fair, statewide manner rather than concentrated in a particular area of the state. Statewide Fire Suppression - Relates to expectation of a supplemental appropriation for actual fire suppression costs. Senator Rieger inquired concerning procurement of water rights. Co-chairman Frank referenced water development. Senator Rieger voiced concern regarding park fees and withdrawal of commensurate general funds. Co-chairman Frank concurred in the concern, acknowledging that the division should be able to keep part of what it raises. The proposed budget would allow parks to keep 50 cents of every dollar. The subcommittee approved the Governor's program receipt increment of $600.0 but deleted half of it back in the $319.0 deletion of general funds. Senator Phillips also concurred in comments by Senator Rieger. Co-chairman Frank reiterated that the budget allows parks to increase fees and keep half of what they make. He acknowledged that the division was not held harmless from general fund reductions. Co-chairman Halford MOVED for adoption of the subcommittee report and letters of intent for the Dept. of Natural Resources budget for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. DEPT. OF ADMINISTRATION Senator Randy Phillips distributed a handout (Attachment K) and advised that the goal was $169,601.6. The subcommittee met the goal and effected a total reduction of $6,854.5 from FY 95 funding. A total of seventeen positions were also reduced. The subcommittee budget consists of the following general fund reductions: Longevity Bonus (revised estimates) $ 450.0 Senior Services Admin. (pers.ser., travel, contractual) 60.3 Senior Services Senior Residential Grant (Kotzebue Senior Center, Medicaid eligibility) 120.0 Senior Services funding change (204 GF to 204 GF/PR increase rates effective February, 1996) 0.0 Public Defender Agency (consistent with supp.funding) 73.1 Office of Public Advocacy (216.6 above FY 95 with supp.) 125.0 Office of the Commissioner (personal services) 100.0 Permanency Planning (funding in fiscal note, HB 66) 170.6 Personnel (deny increment) 404.0 Retirement & Benefits, EPORS (denied portion of increment, retirements uncertain) 25.0 Oil and Gas Conservation Commission (denied increment) 9.0 Alaska Public Offices Commission (denied increment reduce to FY 94 level, nonelection year) 14.4 RATNET (transferred to new component) $1,129.7 Public Broadcasting (25% reduction, first year of three-year phaseout, see intent) $1,467.9 Leasing (5% reduction) $1,219.5 Co-chairman Frank inquired concerning the $120.0 reduction for Kotzebue. Jerry Burnette advised of department testimony that Medicaid would cover the cost. The Co- chairman further inquired regarding funding for both the Public Defender and Office of Public Advocacy, asking if the agencies were funded at the FY 95 level plus supplemental funding. Senator Phillips concurred in that understanding. Senator Donley advised of contact from Senator Duncan's office and interest in restoring funding for RATNET and public broadcasting. Co-chairman Frank advised that it would be helpful to hear comments from the agencies relating to reductions. He suggested that discussion occur at the next meeting. Senator Phillips said he worked closely with the department in preparation of the subcommittee budget. The other body reduced public broadcasting by 100%. The Senate subcommittee recommends a 25% reduction and a three- year phase out. The hope is that both the public and private sector will respond in providing dollars for public broadcasting. He acknowledged that the situation would be difficult but not unmanageable. MARK BADGER, Director of Information Services, Dept. of Administration, and DOUGLAS SAMIMI-MOORE, Executive Director, Public Broadcasting Commission, Dept. of Administration, came before committee. Mr. Badger explained that distinctions between RATNET and public broadcasting are somewhat misleading. He referenced the phaseout approach for public broadcasting and advised that funding continues to be needed for public television, public radio, and the rural Alaska television network. Mr. Moore acknowledged that the Senate budget restores "some funding to public television," when compared to the House number. At the same time, funding and expenses associated with RATNET transmission and services have been moved to statewide communication services. RATNET, public television, and public radio are to be operated from this new appropriation. Transponder costs associated with RATNET are "more than $800.0 a year." It is unlikely, if not impossible, that both RATNET and public television services could be delivered without some appropriation for RATNET transmissions over the transponder. Mr. Moore acknowledged that technological fixes could result in significantly less operating costs. However, with no capital to make those changes in previous years, the system "is not there yet." Given the high cost of transmission of RATNET and public television, the proposed budget will not allow the department to "do both." Senator Rieger referenced diagrams accompanying subcommittee budget materials and requested an explanation. Mr. Badger said they evidence "a potential way to create some economies while maintaining services." A plan was endorsed by the telecommunications information council that strongly endorses RATNET service. It should be understood that the rural Alaska television network, as it has existed over the past few years, must evolve and change. People accept that. The information highway has a place in Alaska. The thin infrastructure now in place is reliant on public broadcasting and the rural Alaska television network as well as commercial telephone providers. Mr. Badger suggested that dismantling the system with nothing in its place would increase the task of "keeping Alaskans connected." He urged that the evolving system be given an opportunity to fulfill its full potential. Co-chairman Halford referenced a proposal to create a private endowment and channel funding through that entity rather than public broadcasting. He then asked if subcommittee changes are intended to make that possible. Senator Phillips suggested that use of a private endowment reflects a policy decision to be made by committee. At this point, subcommittee funding is "with the commission." Co- chairman Halford voiced his understanding that the appropriation is "to the public broadcasting commission for radio and t.v. services." Senator Phillips concurred. Discussion followed between Co-chairman Frank and Mr. Badger regarding a department proposal submitted to subcommittee. Mr. Badger advised that the department approach was contingent upon "some funding for the RATNET transponder." The $800.0 number is unyielding. Transmission requires the skylink. The Senate budget does not contain that funding. Co-chairman Halford suggested that the public broadcasting commission take the $800.0 from the $1.4 million. Mr. Badger explained that funding for public television is necessary to be able to provide service to the rural Alaska television network. Mr. Moore clarified that the $800.0 relates to lease of the transponder without any expenditures for the tape delay center which takes programs from stations in Anchorage and retransmits them "out of the RATNET system." The $800.0 merely relates to space on the transponder. It does not include programming. The $1.4 million set aside for public television is a reduction from $2.1 that presently flows to four public television grantees. The commission will have to come up with some form of grant allocation to maintain some type of public television service in Alaska. It is difficult to determine how the commission will provide both RATNET and public television, given lack of the $800.0 needed for RATNET and the above-noted reduction of public television to $1.4 million. Mr. Badger added, "It will not work. One is contingent on the other." Mr. Badger explained that the $309.0 reduction in House numbers for RATNET eliminates the tape delay center in Anchorage which combines all the Anchorage signals and retransmits them. It removes a big portion of the rural Alaska television network. To supplant that service, one must have a service that provides a programming line. That is what public television would do. But public television must be funded in order to be able to "pull that off." The two are interlinked. Senator Donley asked if the problem would be solved if Senate numbers were added to the $978.0 provided by the House for RATNET. Mr. Badger and Mr. Moore both responded affirmatively. Co-chairman Frank expressed a preference for adoption of the subcommittee report with the understanding that attention could revert to RATNET and public television after further clarification. Senator Phillips MOVED for adoption of the subcommittee report for the Dept. of Administration budget for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. Senator Phillips next referenced the following items of intent: Public Broadcasting - Requested to seek new sources of support as state support is phased out over the next three years by a 25% reduction in FY 96, a 35% reduction in FY 97, and a 40% reduction in FY 98. Requested to allocate funds to assure survival of stations which provide the sole broadcast service to one or more communities. Requested to coordinate and maximize cost savings and efficiencies for public television and that public broadcasting deliver essential communications to underserviced regions of Alaska. Co-chairman Halford voiced his understanding that all rural radio stations that are the only station in an area will "stay on the air." Senator Phillips concurred, advising of a priority for radio over television. Referencing the second item of intent, Senator Rieger asked if it was in keeping with systems involving a shared programming station which relays electronically to other broadcast stations in other communities. Mr. Moore acknowledged that it is consistent in the sense that the mission of the public broadcasting commission is to fund and develop a system of public broadcasting that serves the educational, informational, entertainment, and cultural needs and to provide public broadcasting services to people in Alaska. He added that virtually every public radio station provides some level of sole service. As an example, he noted that Sitka provides service to Kake, Yakutat, and other locations. Through strategic planning over the last three years, the system is moving toward a regional grouping of stations such that they can consolidate efforts, realize economies through closer coordination, and free up resources at the local level for local news and information services. Intent language in paragraph two is not in conflict with that. Co- chairman Halford voiced his understanding that FY 95 funding was approximately $7 million. The House funded $4 million and the Senate $4.4. Department representatives concurred. Senator Phillips MOVED for adoption of the foregoing intent items, for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. DEPT. OF PUBLIC SAFETY Senator Rieger distributed a handout (Attachement L) and explained that attaining the budget cap involved "a lot of little decrements." He then commenced the following review: Fish and Wildlife Protection Enforcement - Reduced an increment of $150.0 in personal services, $15.0 in travel, $10.0 in contractual, and $4.0 in commodities. There was also a switch of $1 million from general funds to the fish and game fund. Senator Rieger said he would subsequently offer an amendment to change the latter amount, based on the actual balance in the fish and game fund. Director's Office - Reduced personal services $14.0 and travel $1.0. Aircraft Section - Misc. operational reduction of $30.0 plus $42.0 in personal services. Marine Enforcement - Reduced personal services $25.0 and $10.0 in misc. operations. Fire Prevention Operations - Denied a $184.6 increment, $90.0 in personal services, and $73.8 in general funds to be offset with program receipts through institution of fees. Fire Service Training - Denied the $204.1 increment. Highway Safety Planning Operations- Effected a $5.0 reduction in personal services. Motor Vehicles Field Services - Reduced $300.0 in general funds and replaced them with $300.0 in program receipts. Administration - Reduced personal services by $50.0. Alaska State Troopers Detachments - Denied a $700.0 increment. Reduced travel $30.0, contractual $87.0, commodities $5.0, equipment $9.3 and overall personal services reduction of $1,845.9. Both the House and the Senate subcommittees reduced program receipts for the concealed weapons program by $228.5. Special Projects - This new component was funded $1,600.0 from interagency receipts from the highway safety planning agency (helmet bill money). There is intent language that funds the school bus safety program referred to as interagency receipts in the Dept. of Education budget. Criminal Investigation Bureau - Reduced personal services $84.0, contractual $32.4, and commodities $6.0. Director's Office - Reduced personal services $45.0, contractual $1.0, and commodities $1.0. Judicial Services - Reduced personal services $35.0 and contractual $5.0. Prisoner Transportation - Reduced travel $50.0. Search & Rescue - Miscellaneous reduction of $8.0. Rural Trooper Housing - Miscellaneous reduction of $38.0, plus intent language directing the department to increase program receipts in FY 97 and move the program toward full self-support via program receipts. Narcotics Task Force - Miscellaneous reduction of $100.0. Commercial Vehicle Enforcement - Miscellaneous reduction of $30.0. V.P.S.O. Contracts - Denied the $219.2 increment and transferred $35.0 from VPSO support to contracts. Alaska Police Standards Council Took a miscellaneous reduction of $259.1. Violent Crimes Compensation Board Reduced $100.0 from day fines but added front section language that extends the lapse for day fines moneys from FY 95. Domestic Violence and Sexual Assault Replaced $325.0 in general funds with permanent fund dividends. Deleted day fines of $100.0, and the $87.9 increment for shelter grants. Statewide Support Training Academy- Took a miscellaneous reduction of $10.0. Administrative Services - Reduced personal services $40.0. Public Safety Information Network - Denied a $267.8 increment. Alaska Criminal Records and Identification - Denied a $36.6 increment and reduced $100.0 in general funds program receipts from the concealed weapons permit program. The subcommittee budget totals $81,447.5 in general funds. That is sufficiently under the cap to allow the funding source correction to the fish and game fund. Senator Rieger advised that he would suggest a $1 million funding switch to $445.5 in general funds and $555.5 from the fish and game fund. In response to a question from Co-chairman Halford, Senator Rieger explained that the fund is derived from forfeitures and penalties. The balance rolls forward, and some of it is used in the department budget. Pending legislation which would double fines could have a dramatic impact on the forfeiture and penalties component. Senator Rieger next directed attention to intent items: Highway Safety Planning - Expresses legislative intent that grants include $50.8 for the school bus inspection program in the Dept. of Education. Expresses legislative intent that grants include $1.6 million for safety programs administered by the special projects component of the Alaska State Troopers. Motor Vehicles - Requests that the division assess methods of increasing availability of commercial motor vehicle license testing around the state. Alaska State Troopers, Rural Trooper Housing - Requests that the program eventually be totally supported by rent receipts. For FY 97, rental receipts are to increase by at least an additional $63,100 over the FY 96 figure. Senator Donley voiced his understanding that rural trooper housing was part of the collective bargaining contract. Senator Rieger concurred. He then explained that intent has been placed in the budget in advance so that it will become part of the next bargaining package. Discussion followed regarding the impact of intent upon future negotiations. Discussion followed between Senator Sharp and Senator Rieger regarding aircraft operations within trooper detachments. Senator Rieger noted that funding is shown in contractual lines. The program is much smaller than that of fish and wildlife protection. It consists of two helicopters (one in Anchorage and one in Fairbanks) used for search and rescue. Senator Rieger advised that the aircraft is owned rather than leased. Considerable subcommittee discussion focused on the issue. Senator Donley voiced concern regarding enforcement of mandatory auto insurance and financial responsibility acts. He noted that when the laws were enacted, the legislature provided additional fees to pay for them. The department asserts that over the years those fees have been bled off to other parts of the general fund. He then inquired regarding the impact of cuts in program receipts in the field services section of the division of motor vehicles. Senator Rieger advised that the subcommittee budget provides a $38.0 program receipt increment for field services. The Senator acknowledged that had the cap not been so difficult, he would have provided a further increase. He further acknowledged complaints about lines at field offices. Over the past several years, the Legislative Budget and Audit Committee has allowed a "small number of extra positions in DMV field services, funded by program receipts . . . ." Senator Rieger next referenced a proposed amendment containing a change of funding of $444.5 for fish and wildlife protection, enforcement and investigative services, from the fish and game fund to general funding. He explained that he learned of need for the change after subcommittee closeouts. As a further explanation he referenced a subcommittee switch of $1 million in funding from general fund to the fish and game fund. The amendment would be a reduction of $555.5 from the fish and game fund and an increase of $444.5 in general funds. Senator Rieger then MOVED for adoption of the proposed amendment to the subcommittee recommendation. No objection having been raised, the AMENDMENT was ADOPTED. Co-chairman Frank advised that front section items would not be dealt with at this time. Senator Rieger MOVED for adoption of the amended subcommittee budget, including intent, for the Dept. of Public Safety for incorporation within HB 100. Senator Sharp warned of the possibility of comment from commercial fishing interests that have traditionally utilized the fish and game fund. Co-chairman Halford referenced funding for fish and wildlife protection and troopers when he commented that funding for the department appears to be about the same as last year. The budget appears to contain an increase in federal funds to match a decrease in general funds. Senator Rieger noted real reductions in almost every component with the exception of enforcement where the subcommittee sought to ensure that the number of blue and brown shirts in the field would not be decreased. To a further comment by the Co-chairman, noting that federal moneys increased from $6 to $9 million, Senator Rieger explained that not all federal receipts accrue to public safety. Aside from an increase in federal dollars for the narcotics task force, the bulk of the increase is helmet money which is subsequently granted to municipalities or other state agencies for safety programs. No objection to the motion for adoption and incorporation having been raised, IT WAS SO ORDERED. DEPT. OF LAW Co-chairman Halford advised that the subcommittee budget meets the $19,556.8 general fund cap. He explained that funding holds prosecution harmless, thus providing the same funding as the House and the Governor's amended budget. Cuts were allocated through other areas of the department. The Co-chairman noted the following changes: Fair Business Practice - Eliminated $150.0 and personnel engaged solely in antitrust activities. Seed money was left to maintain some antitrust activity through private counsel. Operations - Components were reduced 1% below the FY 95 authorized level. Mental Health Lands - The Senate recommendation is the same as that of the House. Operations/Time Keeping - The subcommittee concurred in the Governor's decision to move time keeping out of the operations BRU. That reduced the operations base to $919.1. The subcommittee then applied an additional 15% reduction to $769.8. Oil and Gas Litigation - The subcommittee reduced funding from $24 million to $20 million. That amount is more current in terms of ongoing litigation. Environmental Compliance - The subcommittee agreed with the administration's request to remove the $655.2 to be appropriated from the 470 fund. That funding will remain available through the Dept. of Environmental Conservation. Much of the legal services provided by the department can be charged to other departments and paid by interagency receipts. The bulk of funding for this component should be derived by that means. Exxon Valdez Litigation - The subcommittee took the same approach as the House and agreed with the administration's request to remove $100.0 to be appropriated from the 470 fund. That funding will be available through the Dept. of Environmental Conservation. The subcommittee budget also minimized allocations to provide maximum flexibility within the department. Co-chairman Halford MOVED for adoption of the subcommittee budget for the Dept. of Law for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. LEGISLATURE Co-chairman Frank explained that the budget meets the cap of $29,045.6. He then conducted the following review: Budget & Audit Committee Legislature Audit - Funded at the FY 94 actual level. Legislative Finance - Funded at $2.7 million. Committee Expenses - Funded at $175.0. Legislative Council Salaries & Allowances - Funded at last year's authorization, $3.7 million. Administrative Services - Slight reduction to $7.0 million. End: SFC-95, #29, Side 1 Begin: SFC-95, #29, Side 2 Session Expenses - Funded at $5.5 million. Legislative Council - Funded at $434.0, a decrease from the FY 94 actual. Legal & Research - Combined the agencies and funded them at $2.0 million, a decrease from FY 94 actual. Leadership - Funding is reduced to $4,056.9 from the FY 94 actual of $4.5 million. Ombudsman - Funded at $700.0. That is a decrease from last year's conference committee funding of $975.0 and FY 95 authorization of $1,041.4. In response to a question from Senator Donley, Co-chairman Frank explained that FY 94 actual numbers represent the best comparison for FY 96 funding. Areas where reductions in FY 94 actual funding were taken include Legislative Finance, a reduction from $3 million to $2.7. The Ombudsman sustained a significant reduction from both FY 94 and FY 95 funding. Legislative Leadership accounts are "down by $500.0." Combination of legal and research services results in a reduction of approximately $250.0. Senator Donley inquired concerning legal and research capabilities at the reduced level. Co-chairman Frank acknowledged a reduction in personnel due to the consolidation. He stressed, however, that it was logical to combine the two and reduce both personnel and overhead. Senator Randy Phillips MOVED for adoption of the subcommittee recommendation for the budget for the Legislature for incorporation within HB 100. No objection having been raised, IT WAS SO ORDERED. ADJOURNMENT The meeting was adjourned at approximately 8:55 p.m.