Legislature(1995 - 1996)

04/19/1995 12:20 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
  HB 100 -  APPROP: FY 96 OPERATING & LOAN BUDGET                              
                                                                               
            The subcommittee budget for the Dept. of Labor was                 
            moved and adopted.   Amendments  2 through 97  and                 
            front  sections of  the budget  were  reviewed and                 
            acted upon,  and  funding for  the Alaska  Tourism                 
            Marketing  Council,  the Alaska  Seafood Marketing                 
            Institute, Senior Citizen and Disabled Veteran Tax                 
            Relief,  Revenue  Sharing,  Municipal  Assistance,                 
            Adult Public Assistance, and Aide to Families with                 
            Dependent Children was adopted.  The bill was then                 
            held  in committee  for concluding  action  at the                 
            next meeting.                                                      
                                                                               
  Upon  convening the  meeting,  Co-chairman Frank  referenced                 
  open  areas  of the  budget  consisting of  Dept.  of Labor,                 
  Senior  Citizen   and  Disabled   Veteran  Tax   Exemptions,                 
  Municipal  Assistance,  Revenue   Sharing,  Alaska   Tourism                 
  Marketing, Alaska  Seafood Marketing  Institute, AFDC,  APA,                 
  Front  Sections,  and amendments.    He then  suggested that                 
  discussion   proceed  to   review  of   numbered  Amendments                 
  contained within committee packets.  [Copies of Amendments 1                 
  through 97 are appended to these minutes.]                                   
                                                                               
  AMENDMENT NO. 1                                                              
                                                                               
  Co-chairman Frank noted  that the  amendment for the  Alaska                 
  State  Council  on  the Arts  was  technical  in nature  and                 
  adopted at the April 11, 1995, meeting.                                      
                                                                               
                                                                               
  AMENDMENT NO. 2                                                              
                                                                               
  Senator Sharp explained that the  amendment for the Division                 
  of Investments  within the  Dept. of  Commerce and  Economic                 
  Development is non-general fund and effects small changes in                 
  "where the funds would be coming from."  No objection having                 
  been raised, Amendment No. 2 was ADOPTED.                                    
                                                                               
  AMENDMENT NO. 3                                                              
                                                                               
  Senator  Donley  said  that  the  amendment  contains intent                 
  language  asking  that  by  December  30, 1995,  the  Alaska                 
  Seafood  Marketing  Institute  relocate  within  Alaska  all                 
  employees  currently  located  out  of  state and  that  the                 
  decrement in personal  services be  taken from the  Bellevue                 
  Office.     The  foregoing   requests  reflect   things  the                 
  subcommittee  intended to do but "didn't  quite get into the                 
  intent language."    He  then  MOVED  for  adoption  of  the                 
  amendment.  In  response to a question from Senator Zharoff,                 
  Senator Donley explained that the subcommittee took a $200.0                 
  decrement in personnel  services.  It  was to be taken  from                 
  non-Alaskan employees.  Senator Zharoff asked if funding for                 
  the  Bellevue  office  derives  from  the  general  fund  or                 
  industry assessments.  He also asked if it was necessary for                 
  the office to be  located in Bellevue.  Senator  Donley said                 
  he  posed  that  question  several  times  and  came to  the                 
  conclusion  that marketing  efforts could be  conducted from                 
  Alaska.    Senator  Zharoff  advised   he  had  prepared  an                 
  amendment  to  restore the  deleted  funds and  continue the                 
  marketing  effort.  He  explained that  most of  the funding                 
  represents program  receipts from the industry  for domestic                 
  marketing.                                                                   
                                                                               
  Comments  by  Senator Zharoff  followed  regarding increased                 
  assessments on the industry as well as the increase in board                 
  membership to twenty-five.  He said he did not disagree that                 
  employees should be  located in Alaska but stressed that the                 
  state has  made "some  tremendous strides  in the  marketing                 
  effort of our Alaskan seafood .  . . on the domestic level."                 
  A  decrement  at this  time  could  stall that  effort.   He                 
  further attested  to problems  associated  with attempts  to                 
  conduct all marketing from within Alaska.                                    
                                                                               
  Senator Sharp advised  that all members of  the subcommittee                 
  recommended  the proposed language.   He noted  that half of                 
  ASMI's employees are  now located in  Bellevue, and half  of                 
  the dollars  are located there.   Senator Donley  added that                 
  without the intent, there is danger that  the reduction will                 
  be taken against Alaskan rather than out-of-state employees.                 
  Senator Zharoff  concurred in need for Alaska hire but again                 
  inquired concerning the impact upon marketing efforts.                       
                                                                               
  ANNALEE  McCONNELL,  Director,  Office  of  Management   and                 
  Budget,  came  before  committee.    She  advised  that  the                 
                                                                               
                                                                               
  decrement in program receipt authority  is separate from the                 
  amount  "that's  relative  to  the  Bellevue office."    She                 
  declined to become involved in the  issue of location of the                 
  out-of-state office.                                                         
                                                                               
  Co-chairman Frank called  for a show  of hand on the  motion                 
  for adoption.  Amendment No. 3 was ADOPTED on a vote of 6 to                 
  1.   [See  pages 55 and  56 for  further discussion  of ASMI                 
  funding.]                                                                    
                                                                               
  AMENDMENT NO. 4                                                              
                                                                               
  Co-chairman  Frank  advised that  the  amendment relates  to                 
  Senior Citizen  and Disabled  Veteran Tax  Relief and  would                 
  fund the  Homeowners' Property  Tax Exemption at  $1,163,800                 
  and the Renters' Equivalency  Rebate at $336,200.   It would                 
  also  fund  State  Revenue  Sharing   at    $26,836,600  and                 
  Municipal  Assistance at  $32,646,200.   Co-chairman Halford                 
  MOVED for adoption.   Co-chairman  Frank explained that  tax                 
  relief for senior citizens and veterans is funded at a total                 
  of  $1.5  million,  the  same  as  last  year.  Funding  for                 
  municipal  assistance and  revenue  sharing  reflects  a  5%                 
  reduction.  Senator  Phillips MOVED  to divide the  question                 
  between tax  relief and  municipal assistance.   Co-chairman                 
  Frank  noted  an error  in  the proposed  amendment  in that                 
  amounts  shown  for  deletion   under  revenue  sharing  and                 
  municipal  assistance  should  be  zero  since  that  Senate                 
  budget,  at this point, contains  no funding.  Amounts shown                 
  for deletion are House figures, a 10% reduction.                             
                                                                               
  Co-chairman Frank called for  objections to proposed funding                 
  for  senior  citizen and  veteran tax  relief  at the  FY 95                 
  level.   In  response to  an inquiry  from Senator  Zharoff,                 
  Annalee  McConnell  advised that  proposed  funding of  $1.5                 
  million is the same amount  requested by the administration.                 
  Upon a show of hands, funding for senior citizen and veteran                 
  tax relief was unanimously ADOPTED.                                          
                                                                               
  Senator   Phillips  expressed   a  preference   for  funding                 
  municipal assistance and revenue sharing at the FY 95 level.                 
  Senator Zharoff inquired  concerning the amount  involved in                 
  the proposed 5%  reduction.  Annalee McConnell  advised that                 
  the administration suggested  a 1.7%  reduction from FY  95.                 
  Senator Zharoff asked what impact the Senate reduction would                 
  have  upon  municipalities.   Ms.  McConnell  said  that for                 
  communities receiving minimum entitlement, funding would not                 
  change.  The reduction would "drop the amount for the larger                 
  communities--anybody over the  minimum entitlement."  Larger                 
  communities rely more  heavily on  municipal assistance  and                 
  revenue sharing.  The largest impact in actual dollars would                 
  be upon Anchorage,  Fairbanks, Juneau, etc.   The difference                 
  between the reduction anticipated  by the administration and                 
  that proposed by  the Senate would  "a little bit more  than                 
  double the amount  of reduction that those  communities were                 
                                                                               
                                                                               
  expecting to take."                                                          
                                                                               
  Senator Phillips advised that his opposition to the proposed                 
  amendment,  as  well  as  funding   suggested  by  both  the                 
  administration and the house, stems from the fact that other                 
  formula  fundings  have  not  felt  the  same  reduction  as                 
  municipal revenue sharing.  Ms. McConnell acknowledged a 55%                 
  reduction "from the high point."                                             
                                                                               
  Senator Phillips MOVED  to amend the proposed  amendment and                 
  provide   revenue  sharing   of   $28,249.1  and   municipal                 
  assistance of $34,364.4.  That would fund both components at                 
  the FY 95  level.  Co-chairman  Frank voiced his  OBJECTION.                 
  Senator  Donley  concurred  in  the  foregoing  comments  by                 
  Senator Phillips and  noted the chain reaction  in municipal                 
  budgets created by the cut,  voicing particular concern that                 
  commensurate cuts would be taken in the education budget for                 
  Anchorage.  He then voiced support  for the amendment to the                 
  amendment.    Senator  Sharp  stressed  that  the  budgeting                 
  approach was  to look back  to what the  state did not  have                 
  prior to  1980.   Revenue sharing  and municipal  assistance                 
  were  not  part  of  the  budget  process in  1977-78.    He                 
  suggested  that  if   the  legislature  is  going   to  make                 
  reductions "You've got  to look at  the big ones."   Senator                 
  Zharoff  voiced   his  recollection  that   prior  to  state                 
  provision  of municipal  revenue sharing,  moneys flowed  to                 
  municipalities from the federal government.                                  
                                                                               
  Co-chairman  Frank  called  for  a  show  of  hands  on  the                 
  amendment to the amendment.  The motion FAILED on a  vote of                 
  3 to 4.                                                                      
                                                                               
  Senator Zharoff  MOVED for adoption  of an amendment  to the                 
  amendment  which would  provide funding for  revenue sharing                 
  and municipal assistance at the  1.7% reduction suggested by                 
  the  administration.  Co-chairman Frank called for a show of                 
  hands.  The motion FAILED on a vote of 2 to 5.                               
                                                                               
  Senator Rieger asked if allocation of funds is prescribed in                 
  statute or administered  by regulation when funding  is less                 
  than  the  entitlement.   Ms.  McConnell explained  that the                 
  minimum  entitlement  for   small  communities  is  set   in                 
  statutes.  The  formula method  is partially established  in                 
  statute  with  the  remainder  set   in  regulations.    The                 
  administration  does  not  have  discretion  as  to  how  it                 
  allocates the money.  Further discussion followed concerning                 
  Senator Rieger's  recollection that  short funding  would be                 
  allocated prorata across  all communities. REMOND HENDERSON,                 
  Division of Administrative Services, Dept.  of Community and                 
  Regional   Affairs,  spoke   to   distribution  of   minimum                 
  entitlement funds  and  the formula  involved  in  providing                 
  additional funds.                                                            
                                                                               
  Senator  Zharoff expressed  concern  on  behalf of  Alaska's                 
                                                                               
                                                                               
  smaller communities.   Senator  Phillips reiterated need  to                 
  examine other  state formula  programs for  reductions.   He                 
  stressed need for FY 95 level funding  and voiced opposition                 
  to the amendment.   Co-chairman Frank  called for a show  of                 
  hands  on  the  main  amendment  to fund  municipal  revenue                 
  sharing at a 5% reduction.  The motion CARRIED on a  vote of                 
  4 to 3, and the second half  of Amendment No. 4 was ADOPTED.                 
                                                                               
                                                                               
  AMENDMENT NO. 5                                                              
                                                                               
  Co-chairman Halford  MOVED for adoption of  proposed funding                 
  for  Aide  to  Families with  Dependent  Children  and Adult                 
  Public Assistance.  Co-chairman Frank explained that funding                 
  is  consistent  with SB  98.    It reflects  a  $6.8 million                 
  reduction from  the  Governor's request.    Senator  Zharoff                 
  inquired  regarding  the  impact.     Ms.  McConnell  voiced                 
  opposition to reductions  in AFDC payments, saying  that the                 
  best way to  achieve welfare reform  is to move  individuals                 
  into  training  and subsequent  jobs.  She  asked if  Senate                 
  funding  is intended to  match proposed House  action to cut                 
  the ratable 7%.   She  further spoke to  methods of  cutting                 
  welfare, stressing the importance of job training.                           
                                                                               
  KAREN  PERDUE,  Commissioner,  Dept.  of  Health  and Social                 
  Services, came before committee.   She voiced her assumption                 
  that proposed funding  would precede passage of  a statutory                 
  amendment  to  effect  a  ratable  reduction.   The  ratable                 
  reduction would  be the largest reduction "ever accomplished                 
  on the AFDC  program" and would  equate to a $69.00  monthly                 
  reduction  to each  of the  14,000 families on  AFDC.    Co-                 
  chairman Halford asked how the  amendment would compare with                 
  proposed federal reductions  in AFDC.  Ms.  Perdue said that                 
  "If  we  did no  aggressive  welfare reform  changes," there                 
  would be a  reduction in  benefits that would  be near  this                 
  amount.  If  the state changed eligibility  requirements for                 
  the program, the money would be spread differently.                          
                                                                               
  Co-chairman Frank  advised that proposed  funding for  Adult                 
  Public Assistance is at the level requested by the Governor.                 
  In response  to a question from Senator Donley regarding the                 
  $125.0 in  general funds  to be  deleted, Co-chairman  Frank                 
  explained  that  the  reduction   is  not  associated   with                 
  entitlements.   It relates  to an  administrative reduction.                 
  Commissioner  Perdue  said  that   the  number  matches  the                 
  subcommittee reduction  in the  interim assistance  program,                 
  offset by a  $50.0 increment to  assist with legal costs  in                 
  helping individuals become "SSI determined."                                 
                                                                               
  Co-chairman  Frank directed  that  the  meeting  be  briefly                 
  recessed.                                                                    
                                                                               
                       RECESS - 1:05 P.M.                                      
                      RECONVENE - 1:40 P.M.                                    
                                                                               
                                                                               
  Upon  reconvening the  meeting,  Co-chairman Frank  directed                 
  attention to a revised version of Amendment No. 5.                           
                                                                               
  End:      SFC-95, #31, Side 1                                                
  Begin:    SFC-95, #31, Side 2                                                
                                                                               
  He  then  noted need  to correct  amounts  set forth  on the                 
  revised  version  to  reflect  $55,807.2  in federal  funds;                 
  $55,807.2 in general  funds; and $11,610.7 in  other moneys.                 
  Commissioner Perdue  explained that  proposed funding  would                 
  cut  AFDC  payments  by  7%,  the  maximum  federal  amount,                 
  resulting in a  reduction of  $69.00 a month.   A  statutory                 
  change would  be needed to implement the reduction.  Payment                 
  will not be cut unless a statutory change is made.  Proposed                 
  funding sets the department up for a supplemental should the                 
  Governor veto a statutory change.   Ms. McConnell emphasized                 
  that the  Governor has  gone on  record saying  he does  not                 
  support a reduction in  the ratables.  Payments are  a legal                 
  entitlement.    Without   a  change  in  the   statute,  the                 
  administration has no choice but to comply  with the statute                 
  and  make  payments  as required.    The  administration has                 
  active plans for  welfare reform,  but ratable reduction  is                 
  not  one of  them.   Commissioner  Perdue  advised that  the                 
  Senate  proposal  reflects  a policy  change  as  well as  a                 
  budgetary change.   She suggested  that the issue  should be                 
  debated in the context  of a fiscal note rather  than within                 
  the budget.   Ms.  McConnell referenced  the House  approach                 
  which  effects   the   statutory   change   in   legislation                 
  accompanied  by a fiscal  note reducing funding.   She urged                 
  that the Senate do the same.                                                 
                                                                               
  In  response to  a  question from  Senator  Sharp seeking  a                 
  comparison of proposed  funding with that  for FY 95,  NANCY                 
  SLAGLE, Director of Budget Review,  Office of Management and                 
  Budget,  explained   that  the  amount   the  administration                 
  requested for FY 96 is less than 95.  The Governor's general                 
  fund  request  is  $58,906.0.   The  amount  for  FY 95  was                 
  $61,435.0.    The Senator  then asked  if  any of  the funds                 
  lapsed.  Ms. Slagle acknowledged that some were offered as a                 
  reduction in the supplemental.                                               
                                                                               
  Commissioner  Perdue  expressed concern  regarding  a policy                 
  change  and its  impact  on Alaskan  families.   She  voiced                 
  further concern  regarding need  for a  future supplemental,                 
  advising "This is  the kind of  payment that we really  must                 
  make."    People  depend  on it  for  their  monthly  living                 
  expenses.                                                                    
                                                                               
  Discussion followed  regarding policy  provisions within  SB                 
  98.                                                                          
                                                                               
  Co-chairman Frank called for  a show of hands on  the motion                 
  for adoption.  Amendment No. 5 was ADOPTED on a vote of 4 to                 
                                                                               
                                                                               
  2.                                                                           
                                                                               
  AMENDMENT NO. 6                                                              
                                                                               
  Senator Sharp advised that the  amendment to insert $163,800                 
  to support a wood bison management and transplanting program                 
  within the Wildlife  Conservation BRU of  the Dept. of  Fish                 
  and Game budget was ADOPTED at the April 12, 1995, meeting.                  
                                                                               
  AMENDMENT NO. 7                                                              
                                                                               
  Co-chairman Frank explained that the amendment would conform                 
  Dept. of Administration, Dept. of Law, Dept. of Labor, Dept.                 
  of  Natural Resources,  Dept.  of Fish  and  Game, Dept.  of                 
  Public   Safety,   Dept.   of  Transportation   and   Public                 
  Facilities, Dept. of Community and  Regional Affairs and the                 
  University of Alaska budgets to action taken in the Dept. of                 
  Environmental  Conservation  budget regarding  response fund                 
  administration.    Senator Rieger  voiced  his understanding                 
  that the subcommittee for the DEC budget approved the amount                 
  of funding to flow from the oil and hazardous substance fund                 
  to other departments.                                                        
                                                                               
  Discussion  followed between  Senator  Zharoff and  VIRGINIA                 
  STONKUS,  fiscal  analyst,  Legislative   Finance  Division,                 
  regarding the impact on  the University.   MARY  LOU BURTON,                 
  University   of  Alaska,  concurred  in  comments  that  the                 
  University has no problem with the proposed adjustment since                 
  it relates to a board that is sunsetting.                                    
                                                                               
  Co-chairman Frank called  for objections to adoption  of the                 
  amendment.  No objection having been raised, Amendment No. 7                 
  was ADOPTED.                                                                 
                                                                               
  AMENDMENT NO. 8                                                              
                                                                               
  Co-chairman  Halford MOVED for  adoption.  Co-chairman Frank                 
  explained that the  amendment would change the  reduction in                 
  oil and gas development from a specific reduction in presale                 
  analysis to a  general $100.0 general fund  reduction within                 
  the  $4  million BRU.    The  intent is  to  provide greater                 
  flexibility.  No objection having been raised, Amendment No.                 
  8 was ADOPTED.                                                               
                                                                               
  AMENDMENT NO. 9                                                              
                                                                               
  Co-chairman  Frank explained  that  the technical  amendment                 
  establishes  the  fixed  costs  component  within  the  fire                 
  suppression BRU in a manner  which provides more flexibility                 
  to the  department.  Ms. McConnell sought assurance that the                 
  intent  was  clear that  costs  would  be funded  through  a                 
  supplemental.  That  was the Senate's preference  as opposed                 
  "to doing  it up  front in  the  budget."   No objection  to                 
  adoption having been raised, Amendment No. 9 was ADOPTED.                    
                                                                               
                                                                               
  AMENDMENT NO. 10                                                             
                                                                               
  Senator Sharp MOVED for adoption.   Senator Zharoff OBJECTED                 
  for the purpose of explanation.  Senator Sharp advised that,                 
  per the  amendment, fish  and game  funds and  federal funds                 
  exceeding the amount funded  in the budget must  be approved                 
  by  the  Legislative  Budget  and   Audit  Committee.    Ms.                 
  McConnell  stressed that the department has not needed to go                 
  to LBA "for this  kind of thing in the past."   No objection                 
  having been raised, Amendment No. 10 was ADOPTED.                            
                                                                               
  AMENDMENT NO. 11                                                             
                                                                               
  Senator  Rieger  explained  that  front  section  provisions                 
  contained  within  the  amendment  relating  to the  Violent                 
  Crimes  Compensation  Board  and  the  Council  on  Domestic                 
  Violence and Sexual  Assault comprise  the remainder of  the                 
  subcommittee report for  the Dept. of Public  Safety budget.                 
  Language   appropriates   twenty-five   percent  of   moneys                 
  collected  from  day  fines to  compensation  of  victims of                 
  violent  crime  and twenty-five  percent  to the  Council on                 
  Domestic  Violence  and  Sexual  Assault.   Provisions  also                 
  extend the lapse date on an FY 95 appropriation  to June 30,                 
  1996.                                                                        
                                                                               
  Discussion  of  operations  of  day  fines followed.    When                 
  queried   by   Senator  Zharoff,   representatives   of  the                 
  administration  indicated  they  had  no  problem  with  the                 
  amendment.  No  objection having been raised,  Amendment No.                 
  11 was ADOPTED.  [See subsequent  action on Amendment No. 90                 
  (page 65) for technical correction of amendment language.]                   
                                                                               
  AMENDMENT NO. 12                                                             
                                                                               
  Senator Rieger explained that operation of the Sitka Airport                 
  remains an unresolved  issue in the Dept.  of Transportation                 
  and  Public Facilities  budget.   He advised  of an  earlier                 
  request for a general  fund increment for the airport.   The                 
  state is now  negotiating  with the city and borough for  an                 
  arrangement whereby  the city  would  collect landing  fees,                 
  contract with the state to operate the airport, and transfer                 
  fee  receipts  to the  state for  operational costs.   Front                 
  Section  language  proposed  within  Amendment  No.   12  is                 
  intended to accommodate that negotiation.  Annalee McConnell                 
  voiced department support for the amendment.                                 
                                                                               
  RON  LIND,  Director,   Administrative  Services,  Dept.  of                 
  Transportation and Public Facilities,  came before committee                 
  in  response to  a  question  from  Senator  Phillips.    He                 
  explained that  the city  of Sitka  indicated it  was losing                 
  $150.0 to $200.0  a year  on airport operations.   Based  on                 
  receipts, it would appear the city was spending over $700.0.                 
  Senator  Rieger   explained  that  while  it   was  somewhat                 
                                                                               
                                                                               
  arbitrary, the $500.0 proposed by subcommittee was "intended                 
  to give a margin because the earlier referenced general fund                 
  request  was  "only for  $410.0."    Mr. Lind  advised  of a                 
  corrected amount of  $490.0.  Senator Rieger  suggested that                 
  if  the  proposed  appropriation   is  not  sufficient,  the                 
  department could  come to LBA.    Mr. Lind advised  that the                 
  state felt it could operate the  airport for $490.0, because                 
  it is combined with the highway station at Sitka.                            
                                                                               
  Further  discussion followed  between Mr.  Lind and  Senator                 
  Zharoff  regarding the  city's  notification that  it  would                 
  cancel its operating agreement.  Mr. Lind explained that the                 
  state-owned  airport  was  thus returned  to  the  state for                 
  operation.  Alaska Airlines  agreed to pay Sitka the  amount                 
  paid in  the past and, in effect, made a grant through Sitka                 
  to  the state for operation of the  airport.  The airport is                 
  the responsibility of the state and operating costs  must be                 
  paid.  The state is attempting to get the city to  take back                 
  operation and reinstitute a fee system.  It would then be up                 
  to the city to decide whether to conduct its own maintenance                 
  or contract with  the state.   Mr. Lind advised, "The  state                 
  cannot reinstitute a  landing fee there without  putting the                 
  tax that was passed last year in jeopardy."                                  
                                                                               
  Senator  Zharoff  asked  if a  similar  process  is followed                 
  elsewhere.  Co-chairman Frank  voiced his understanding that                 
  "It  would  be  a new  little  wrinkle  . .  .  ."   Further                 
  discussion followed concerning  the recent  tax increase  on                 
  aviation fuel and  an associated prohibition on  landing fee                 
  increases.  Mr. Lind explained that when the seven-tenths of                 
  a  cent  fuel tax  increase was  enacted  last year,  it was                 
  designed to  cover what the state had attempted to implement                 
  as landing fees at rural airports. It did not consider Sitka                 
  since it was operated by the municipality.  The tax increase                 
  was accompanied by language saying the tax would be repealed                 
  if the state institutes a landing fee at a rural airport  by                 
  the year 2000.   Sitka  qualifies as a  rural airport  under                 
  present definitions.                                                         
                                                                               
  Further comments followed by Co-chairman Frank regarding the                 
  impact of adoption of the amendment versus failure to do so.                 
  The Co-chairman then called for  objections to adoption.  No                 
  objection having been raised, Amendment No. 12 was ADOPTED.                  
                                                                               
  AMENDMENT NO. 13                                                             
                                                                               
  Co-chairman Frank explained that the amendment would replace                 
  subcommittee  deletion  of   the  assistant  state  recorder                 
  position with a  general reduction in the  Recorder's Office                 
  in  the  Dept.  of Natural  Resources  budget.   Co-chairman                 
  Halford MOVED for adoption of the amendment.  In response to                 
  a question from Senator Zharoff regarding  the impact of the                 
  change, Co-chairman Frank said it would allow the department                 
  to handle  the $63.4  reduction in  the least  objectionable                 
                                                                               
                                                                               
  way.  Senator  Zharoff inquired concerning the effect of the                 
  reduction on outlying recording offices.  Ms. McConnell said                 
  delays  in  document processing  would  occur.   However, it                 
  would be easier to spread the reduction overall rather  than                 
  target a specific area.  The program brings in more receipts                 
  than it expends.                                                             
                                                                               
  At  the request  of Co-chairman  Frank,  Co-chairman Halford                 
  asked that Amendment No.  13 be withdrawn.  [See  page 13 of                 
  these minutes for subsequent adoption of Amendment 13.]                      
                                                                               
  AMENDMENT NO. 14                                                             
                                                                               
  Senator Rieger explained that the  amendment is comprised of                 
  two parts.   The first adds  $129.1 in general  funds to the                 
  Alaska Police Standards Council.  The  second adds $150.0 to                 
  a  new  BRU  entitled,  "Dalton  Highway Protection."    The                 
  Senator advised of a new program receipt funding source from                 
  a surcharge  on citations  to help  fund the  program.   The                 
  original subcommittee recommendation was to zero the general                 
  funds  and  make the  program  totally  self-supporting from                 
  program receipts.   Timing of the program  receipts does not                 
  commence until  January.   The  $129.1 represents  half-year                 
  funding to cover July through December.                                      
                                                                               
  Speaking to  the second  portion of  the amendment,  Senator                 
  Rieger  noted passage of legislation to open the highway and                 
  a revised fiscal note of $660.0  for protection.  The $150.0                 
  in the amendment reflects "all the money that was left under                 
  the cap to put in there."  Co-chairman Frank said  that when                 
  the highway  was opened, he intended to  provide funding for                 
  seasonal  fish  and wildlife  protection.   While  the above                 
  amount does not provide the $660.0 sought by the department,                 
  it provides something.   Senator  Zharoff concurred in  need                 
  for protection along the highway during  the time it is most                 
  heavily used.                                                                
                                                                               
  Senator Donley inquired concerning use of the $129.1 for the                 
  Alaska  Police Standards  Council.   LADDIE  SHAW, Executive                 
  Director, Alaska  Police Standards Council, Dept.  of Public                 
  Safety, advised that  it would  cover administration of  the                 
  Council.    Annalee McConnell  added  that  program receipts                 
  cover   training   for   municipal   police   officers   and                 
  correctional officers.                                                       
                                                                               
  Co-chairman Frank called  for objections to adoption  of the                 
  amendment.  No  objection having been raised,  Amendment No.                 
  14 was ADOPTED.                                                              
                                                                               
  AMENDMENT NO. 15                                                             
                                                                               
  Co-chairman Frank noted  that Amendment  15, which makes  an                 
  unallocated reduction of  $1,385.9 to all components  in the                 
  Dept. of  Transportation and Public Facilities  budget (with                 
                                                                               
                                                                               
  the exception of Marine Highways)  and an unallocated $390.6                 
  reduction to  the  Marine Highway  Stabilization  Fund,  was                 
  previously ADOPTED.                                                          
                                                                               
  AMENDMENT NO. 16                                                             
                                                                               
  Co-chairman Halford explained  that the amendment  transfers                 
  $26.0 from  general fund match  to general funds  within the                 
  General  Relief Medical component in the Dept. of Health and                 
  Social  Services  budget.   The  net  result is  zero.   Co-                 
  chairman Frank called  for objections.  No  objection having                 
  been raised, Amendment No. 16 was ADOPTED.                                   
                                                                               
  AMENDMENT NO. 17                                                             
                                                                               
  Co-chairman   Frank   advised  that   the   amendment  makes                 
  appropriation  of $437,000  for  Community Jails  contingent                 
  upon  contractual  extension  of rates  for  the  next three                 
  years.                                                                       
                                                                               
  End:      SFC-95, #31, Side 2                                                
  Begin:    SFC-95, #37, Side 1                                                
                                                                               
  The  Co-chairman  advised that  FY  96 funding  provides the                 
  remaining half of an increment.  Yet unfunded is the request                 
  for the  FY 95 supplemental.   Ms. McConnell  cautioned that                 
  proposed  funding  does  not  take  care  of  problems  with                 
  existing  contracts for  FY 95.   It  fully  funds contracts                 
  negotiated for FY 96 and carries that amount level for three                 
  years.  Contact with communities  indicated interest in this                 
  type of approach.                                                            
                                                                               
  Co-chairman Frank  called for  objections to  the amendment.                 
  No  objection  having  been  raised,  Amendment No.  17  was                 
  ADOPTED.                                                                     
                                                                               
  [NOTE - See  April 20, 1995, minutes for subsequent language                 
  change of "may" to "shall" within the amendment.]                            
                                                                               
  AMENDMENT NO. 18                                                             
                                                                               
  Co-chairman Frank advised that there is no Amendment No. 18.                 
                                                                               
  AMENDMENT NO. 19                                                             
                                                                               
  Senator Phillips acknowledged  concern by members  regarding                 
  OSHA funding.  The proposed amendment provides an additional                 
  $30.0  for Occupational Safety  and Health  in the  Dept. of                 
  Labor budget.   The budget would  remain below the cap  even                 
  with the addition.   Ms. McConnell advised of $276.0  in the                 
  FY 95 budget  for compliance and other  problems not covered                 
  by federal statutes.   The subcommittee zeroed  that amount.                 
  The impact of that  action will mean that inspectors  in the                 
  field will only deal with "things  that could be charged for                 
                                                                               
                                                                               
  federal statutes but would leave uncovered a number of state                 
  statutes . . . ."  The $30.0 would provide little ability to                 
  deal with enforcement of state law.  She urged consideration                 
  of a higher  number.  A  staff equivalency of 9.5  presently                 
  covers compliance with and violations of state law.  Senator                 
  Phillips MOVED for adoption of  the amendment.  No objection                 
  having been raised, Amendment No. 19 was ADOPTED.                            
                                                                               
  AMENDMENT NO. 20                                                             
                                                                               
  Co-chairman Frank  advised that he  would withdraw Amendment                 
  20 relating to community jails.                                              
                                                                               
  AMENDMENT NO. 21                                                             
                                                                               
  Co-chairman Frank said  that the amendment would  return the                 
  Agriculture Development component to a separate Agricultural                 
  Development BRU.   It  contains no  change in  funding.   In                 
  response to a question from  Senator Donley, the Co-chairman                 
  explained that the House budget moved the component into the                 
  development BRU.                                                             
                                                                               
  Co-chairman Frank  called  for objections.   Senator  Donley                 
  OBJECTED,  stressing  need   for  flexibility  in  spreading                 
  reductions.  Placing agricultural development in a  separate                 
  BRU restricts that capability.  Co-chairman Frank called for                 
  a show of hands.   The motion CARRIED on  a vote of 5 to  2,                 
  and Amendment No. 21 was ADOPTED.                                            
                                                                               
  Senator Zharoff requested a brief recess.                                    
                                                                               
                       RECESS - 2:35 P.M.                                      
                      RECONVENE - 2:55 P.M.                                    
                                                                               
  AMENDMENT NO. 13                                                             
                                                                               
  Upon  reconvening  the meeting,  Co-chairman  Frank directed                 
  attention to Amendment No. 13 which he advised would replace                 
  deletion of the  assistant state recorder in  the Recorder's                 
  Office in  the Dept.  of  Natural Resources  with a  general                 
  reduction.   Senator  Zharoff  advised  that  his  amendment                 
  (Amendment  No. 55)  was similar.   He  said that  following                 
  discussion of Amendment No.  13, earlier in the  meeting, he                 
  received  further clarification of  the issue  and therefore                 
  had no objection to adoption.  Co-chairman Halford MOVED for                 
  adoption  of Amendment  No. 13.   No  objection  having been                 
  raised, the amendment was ADOPTED.                                           
                                                                               
  AMENDMENT NO. 22                                                             
                                                                               
  Co-chairman Frank asked that consideration of  Amendment No.                 
  22,  relating  to  additional   funding  for  Fair  Business                 
  Practices, Environmental  Law,  and  Operations  within  the                 
  Dept. of Law be held for later action.  [See pages 50, 54-55                 
                                                                               
                                                                               
  for subsequent action.]                                                      
                                                                               
  AMENDMENT NO. 23                                                             
                                                                               
  Senator  Zharoff  explained  that the  amendment  would  add                 
  $146.9  to the  Public Broadcasting Commission,  for support                 
  services, and $280.0 for the Southeast Alaska Microwave.  He                 
  then MOVED for adoption.  Senator Phillips OBJECTED.                         
                                                                               
  MARK  BADGER,  Director, Division  of  Information Services,                 
  Dept. of Administration, and DOUGLAS SAMIMI-MOORE, Executive                 
  Director,   Public   Broadcasting   Commission,   Dept.   of                 
  Administration,  came before committee.  Mr. Moore explained                 
  that the Senate appropriation provides for no support staff.                 
  It strictly funds  grants.  The amendment  would provide for                 
  personal  services,  travel,  contractual,  and  commodities                 
  funding for commission staff.  The $280.0 for  the Southeast                 
  Alaska Microwave would allow for continued service to Sitka,                 
  Wrangell,   Petersburg,   Ketchikan,   Angoon,   Kake,   and                 
  Metlakatla.  Without  the addition, the communities  will no                 
  longer receive KTOO transmission.                                            
                                                                               
  Senator  Phillips stressed that  funding recommended  by the                 
  subcommittee met the  Senate cap.  It  provides $4.4 million                 
  for public broadcasting.   That is 75% more than  allowed by                 
  the House.  Senator Zharoff noted that since presentation of                 
  subcommittee  recommendations,  the  commission has  had  an                 
  opportunity to evaluate funding in terms of impact.  He said                 
  he  was  now  attempting  to  bring impact  concerns  before                 
  committee for correction.                                                    
                                                                               
  Co-chairman Frank advised  that he  had not understood  that                 
  Senate reductions would result in discontinuation of service                 
  in   Southeast.     Senator   Phillips   advised  that   the                 
  subcommittee   budget   allows   for   radio   coverage   to                 
  communities.  He  questioned whether television is  really a                 
  function of government.                                                      
                                                                               
  In  response to a  question from  Senator Donley,  Mr. Moore                 
  voiced his understanding  that the $1.4 million  provided in                 
  the  Senate  budget  includes  both  public  television  and                 
  RATNET.   It  will not  be possible to  fund $280.0  for the                 
  microwave  within that  amount.   Annalee  McConnell advised                 
  that if the administration ends up in a situation with House                 
  and  Senate  numbers  as  they   currently  stand,  and  the                 
  conference  committee  accepts both  numbers  and associated                 
  line items, the  merger proposal can  work.  The piece  that                 
  would allow the  signal to  be digitized is  in the  capital                 
  budget.    That would  be  needed to  serve  the above-noted                 
  communities.   Mr. Moore added  that provision of  all three                 
  fundings would also  reduce  operating costs  for RATNET and                 
  public television.                                                           
                                                                               
  Discussion followed between Mr.  Moore and Co-chairman Frank                 
                                                                               
                                                                               
  regarding capital budget funding.                                            
                                                                               
  Senator Donley noted that the proposed amendment is merely a                 
  piece  of what  is needed.   He advised that  he would later                 
  offer an amendment to cover total need.                                      
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 23.  The motion FAILED on a vote of 1 to 6.                    
                                                                               
  AMENDMENT NO. 24                                                             
                                                                               
  Senator Zharoff explained that the  amendment would add $1.1                 
  million  for  RATNET.   He  then  MOVED for  adoption.   Co-                 
  chairman Halford OBJECTED.  MARK  BADGER, Director, Division                 
  of Information Services, Dept. of Administration, again came                 
  before committee.  He explained that  the $1.1 million would                 
  allow for transition  from the current method  of delivering                 
  rural Alaska television  to a  hybrid of pubic  broadcasting                 
  and rural television signals.  It would also fund the RATNET                 
  council, which has  been unable to  meet because of lack  of                 
  moneys.                                                                      
                                                                               
  In response to a  question from Senator Zharoff, Mr.  Badger                 
  acknowledged that  RATNET technology  is outdated.   Senator                 
  Zharoff advised that most communities pay maintenance  costs                 
  at the local level.  He  suggested that the statewide impact                 
  of  RATNET  on   behalf  of   businesses  in  Anchorage   is                 
  noticeable.  In addition to news and other services, it also                 
  provides a vehicle for advertising.                                          
                                                                               
  FORMER LT. GOVERNOR RED BOUCHER  next came before committee.                 
  He explained that  on the first of June, AT&T will take over                 
  Alascom.  The new corporation  will be watching to determine                 
  how much the  state cares  about the existing  communication                 
  structure  to  determine what  investments  it will  make in                 
  Alaska.  With development of new worldwide telecommunication                 
  technologies, Alaska has an infrastructure  that can be used                 
  for medicine, economics, education, etc.   Telecommunication                 
  systems   could  play   a   significant  role   in  economic                 
  development  of  rural  Alaska.   Those  involved  in public                 
  broadcasting,   RATNET,  and   eduction   have  decided   to                 
  consolidate efforts.  Public broadcasting  and RATNET have a                 
  program that will work.  It  should be favorably reviewed in                 
  the  name   of   economic  development.      As   background                 
  information, Former  Lt. Governor  Boucher submitted  a 1990                 
  study resulting from a joint bipartisan effort.                              
                                                                               
  Co-chairman  Frank  asked  that  Amendment  No. 24  be  held                 
  pending review of Senator Donley's amendment.  [See pages 42                 
  and 43 of these minutes for action on Amendment No. 24.]                     
                                                                               
  AMENDMENT NO. 25                                                             
                                                                               
  Senator  Zharoff  withdrew  the amendment,  indicating  that                 
                                                                               
                                                                               
  community jails had previously been  dealt with.  [Amendment                 
  No. 17, pages 11-12.]                                                        
                                                                               
  AMENDMENT NO. 26                                                             
                                                                               
  Senator  Zharoff  MOVED  for adoption  of  the  amendment to                 
  restore  $108.6  to Community  Corrections,  Northern Region                 
  Probation, within the Dept. of Corrections.  He advised that                 
  funding would provide for an additional probation officer to                 
  handle increased caseloads in the Fairbanks Regional Office.                 
  It would also provide clerical assistance and support to the                 
  position.  Without the funding, the office will be unable to                 
  provide proper supervision of all offenders.                                 
                                                                               
  MARGARET  PUGH,  Commissioner,  Dept. of  Corrections,  came                 
  before committee.   She advised that the  Fairbanks Regional                 
  Office  includes the  Bethel  area.   Funding would  cover a                 
  probation officer and part-time clerk.  The officer would be                 
  located  in Bethel.   The  addition would  also  provide for                 
  emergency   locator  beacons   for   snow  machine   travel.                 
  Discussion  of  the presentence  backlog at  Bethel followed                 
  between  Senator Donley  and  Commissioner  Pugh.    Senator                 
  Donley  voiced his understanding  that probation offices are                 
  so understaffed that  officers are unable to  visit homes to                 
  ensure  that  releasees  are  complying  with the  terms  of                 
  probation  and   the   public   is   adequately   protected.                 
  Commissioner  Pugh acknowledged that as attention focused on                 
  overcrowding  in  the  prison  system,  an equal  amount  of                 
  attention was not  given to  growing caseloads in  probation                 
  and parole.   Senator Donley  attested to a  severe lack  of                 
  resources and inability of parole officers to do their jobs.                 
  It is important  to both victims of crime and the public, in                 
  general, that adequate supervision be in place.                              
                                                                               
  Senator Rieger asked  if the  department favors a  probation                 
  fee.    Commissioner Pugh  voiced  her understanding  that a                 
  former probation fee  statute was repealed because  the cost                 
  of collection  exceeded revenues,  particularly in  Northern                 
  and Southcentral regions.                                                    
                                                                               
  Senator Sharp  concurred in  concerns  expressed by  Senator                 
  Donley  regarding public  safety.   He then  advised of  his                 
  belief that problems  with the  division are  internal.   He                 
  stated that "They've successfully run off five of their most                 
  senior  probation officers,"  one via transfer to Barrow and                 
  another to a  desk job at  a state jail.   Of the  remaining                 
  officers who left the division, one had received outstanding                 
  commendations   from  both  the  legislature  and  the  U.S.                 
  Congress.                                                                    
                                                                               
  Senator Zharoff warned  that problems stemming from  lack of                 
  probation resources will  not go away.   The state will  pay                 
  for them  in one  fashion or  another.   The alternative  to                 
  additional probational officers is more costly.                              
                                                                               
                                                                               
  Co-chairman Frank called for a show  of hands on approval of                 
  Amendment No. 26.  The motion FAILED on a vote of 2 to 4.                    
                                                                               
  AMENDMENT NO. 27                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 27.                      
                                                                               
  End:      SFC-95, #37, Side 1                                                
  Begin:    SFC-95, #37, Side 2                                                
                                                                               
  Senator Sharp OBJECTED.  Senator  Zharoff explained that the                 
  amendment  would  return $1.3  million  to road  maintenance                 
  within the Dept. of Transportation  and Public Facilities by                 
  elimination of the unallocated reduction.  Co-chairman Frank                 
  voiced  his  understanding that  the  $1.3 million  would be                 
  equally split between  roads and the marine  highway system.                 
  He  further advised  that  the subcommittee  budget provides                 
  funding  at the FY 94  level, denies increments requested by                 
  the  Governor,  and  contains  a  $1.3  million  unallocated                 
  reduction.                                                                   
                                                                               
  In  the course  of further  discussion of past  and proposed                 
  department funding,  Senator Rieger presented  the following                 
  totals:                                                                      
                                                                               
       FY 94 actual                       $128,025.0                           
       FY 95 authorized                   $129,114.0                           
       FY 96 Governor's original request  $130,119.0                           
       FY 96 Governor's amended           $134,478.9                           
       Senate subcommittee budget         $128,025.0                           
                                                                               
  Co-chairman Frank noted  that the subcommittee budget  is $3                 
  million over the cap.   Annalee McConnell stressed  that the                 
  new  administration  requested  additional  funding  due  to                 
  concern  regarding the  deferred maintenance  backlog.   The                 
  Commissioner  is working on  reducing the per-lane-mile cost                 
  of  maintenance and  achieving significant  savings.   Large                 
  maintenance  items   total  $30  million   statewide.    Ms.                 
  McConnell cautioned that $30 million is not the full amount.                 
  She further advised that when supplementals are added to the                 
  FY 95 authorized figure, total funding is $132,555.0.                        
                                                                               
                                                                               
  Senator  Phillips  inquired concerning  the administration's                 
  position on a  constitutional amendment for a  dedicated gas                 
  tax.   Ms. McConnell  responded that  she was  unaware of  a                 
  position.   RON  LIND, Director, Division  of Administrative                 
  Services,  Dept.  of Transportation  and  Public Facilities,                 
  came before committee to  speak to the issue.   He explained                 
  that the current  motor fuel tax collects  approximately $25                 
  million.  It is not dedicated.                                               
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
                                                                               
                                                                               
  Amendment No. 27.   The motion FAILED  on a vote  of 1 to  6                 
  (Senator Donley did not appear to vote.)                                     
                                                                               
  AMENDMENT NO. 28                                                             
                                                                               
  Senator Zharoff explained  that Amendment  No. 28 would  add                 
  $361.0  for  the Alaska  Legal  Services Corporation  in the                 
  Dept. of Community and Regional Affairs.   Funding for FY 95                 
  was $361.0.  The  Governor requested $421.0 for FY  96.  The                 
  House provided $261.0, and  the Senate subcommittee provided                 
  no  funding.   The  Senator attested  to  loss of  the legal                 
  services office at Kodiak and advised of two or three others                 
  destined  to  close.   Annalee  McConnell  noted  that House                 
  funding would necessitate closure of the Kotzebue office and                 
  reduction of the office at Nome.                                             
                                                                               
  REMOND  HENDERSON,  Director,  Division   of  Administrative                 
  Services,  Dept. of  Community  and Regional  Affairs,  came                 
  before committee in  response to questions from members.  He                 
  advised  of  legal services  offices  in Anchorage,  Bethel,                 
  Barrow, Fairbanks, Juneau,  Kotzebue, and Nome.   The Kodiak                 
  and Dillingham sites  were closed.  These  nonprofit offices                 
  receive  federal, state,  and  local contributions.  Senator                 
  Phillips noted  that state  funding was  not provided  until                 
  1981.    The   Dept.  of  Community  and   Regional  Affairs                 
  subcommittee used criteria which  measured programs in terms                 
  of  whether   they  were  constitutionally   or  statutorily                 
  mandated  and in existence before  1977 (before oil).  Legal                 
  services did  not meet  the criteria.   In  making a  choice                 
  between it  and Headstart,  the subcommittee  opted to  fund                 
  Headstart.                                                                   
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 28.  The motion FAILED on a vote of 1 to 6.                    
                                                                               
  AMENDMENT NO. 29                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 29.  Co-                 
  chairman  Halford  and  Senator  Sharp  OBJECTED.    Senator                 
  Zharoff  explained  that the  FY  95 budget  for  the waiver                 
  services component within the medical  assistance BRU of the                 
  Dept. of Health  and Social Services totaled  $8,881.5.  The                 
  Governor requested $13.6 million.  Both the House and Senate                 
  provided $11,248.0.  Funding relates  to clients who receive                 
  Medicaid for home  and community-based services.   There are                 
  approximately 295 new requests.  Legislative funding  allows                 
  for only half.  The waiver program prevents individuals from                 
  being institutionalized  and saves  50%  of Medicaid  costs.                 
  Annalee McConnell concurred  that the department could  fill                 
  all 295  spots.   She stressed  that the  program is  a cost                 
  avoidance mechanism for reducing institutional costs.                        
                                                                               
  Senator Rieger asked if the  department would favor transfer                 
  of requested  funding from  Medicaid facilities  to Medicaid                 
                                                                               
                                                                               
  waiver  services.   KAREN  PERDUE,  Commissioner,  Dept.  of                 
  Health and  Social  Services, again  came before  committee.                 
  She explained  that, due  to operation  of the  rate-setting                 
  system,  it  is not  possible  to effect  a person-by-person                 
  transfer.  Facilities  continue to have certain  fixed costs                 
  even when the population is reduced.  Discussion of costs at                 
  Medicaid facilities followed.                                                
                                                                               
  Co-chairman  Halford voiced support  for the waiver program.                 
  He noted that Senate funding is higher than that provided by                 
  the House  but not as high  as the Governor requested.   The                 
  Dept.  of Health  and  Social  Services subcommittee  budget                 
  "came in about  $15 million above  the cap."  That  provides                 
  funding well above last year.                                                
                                                                               
  Discussion  followed  regarding  the   Harborview  facility.                 
  Commissioner  Purdue  advised  of  28  residents  who  might                 
  benefit  from waiver  services.   Further  discussion ensued                 
  relating to the  phase-out of Harborview  and the fact  that                 
  Alaska has  one of the  largest and fastest  growing elderly                 
  populations in the United States.                                            
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 29.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 30                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 30.  Co-                 
  chairman Halford OBJECTED.   Senator Zharoff explained  that                 
  the  amendment  would  provide  an  additional  $2,000.0  in                 
  general funds and a like amount  in federal funds to restore                 
  funding for seven services on the Medicaid options list.  He                 
  then recited a listing of those services.  He referenced the                 
  case of an  elderly woman in  a remote community within  his                 
  district who  could afford neither  the hearing  aid or  eye                 
  glasses she needed.   Co-chairman Halford acknowledged  that                 
  the amendment would restore services previously dropped from                 
  the option list.   He  said that if  the subcommittee  could                 
  possibly have restored  options and remained within  the $15                 
  million over  cap,  it would  have done  so.   That was  not                 
  possible.    Without cost  containment,  this area  would be                 
  growing at  a rate  of over 20%  per year.   Both  House and                 
  Senate budgets maintain exactly  the same Medicaid  services                 
  as last year.  No cut was made.                                              
                                                                               
  Commissioner Perdue again came before  committee to speak to                 
  the numbers of  individuals aided  by Medicaid options  that                 
  are no longer available.                                                     
                                                                               
  Senator Donley MOVED to  amend Amendment No. 30 and  utilize                 
  funding from  the underground  storage tank  program as  the                 
  source of the $2 million  addition to Medicaid non-facility.                 
  Discussion of the source of the program receipts  within the                 
  storage  tank fund followed.  Co-chairman Frank called for a                 
                                                                               
                                                                               
  show of hands  on the amendment  to Amendment  No. 30.   The                 
  motion FAILED on a vote of 1 to 6.                                           
                                                                               
  Senator Donley  MOVED to amend Amendment No.  30 and utilize                 
  the agricultural loan program as the source of funding.  Co-                 
  chairman Frank called for  a show of hands on  the amendment                 
  to Amendment No. 30.  The motion FAILED on a vote of 1 to 6.                 
                                                                               
  Co-chairman Frank called  for a  show of hands  on the  main                 
  motion for adoption of Amendment No.  30.  The motion FAILED                 
  on a vote of 2 to 5.                                                         
                                                                               
  Co-chairman Frank  directed  that  the  meeting  be  briefly                 
  recessed.                                                                    
                                                                               
                       RECESS - 4:05 P.M.                                      
                      RECONVENE - 4:20 P.M.                                    
                                                                               
  Upon reconvening  the meeting,  Co-chairman Frank  announced                 
  that Amendments  31, 32,  33, 34,  and 35,  relating to  the                 
  Dept. of Fish and Game, would  be HELD for later discussion.                 
    Senator  Zharoff  so MOVED.    [See pages  50-53  of these                 
  minutes for action on the amendments.]                                       
                                                                               
  AMENDMENT NO. 72                                                             
                                                                               
  Senator Sharp explained that Amendment  No. 72 would restore                 
  recommended funding of  $225.0 from fish  and game funds  to                 
  the   species   management   component   in   the   wildlife                 
  conservation BRU of the Dept. of Fish and Game budget.   Co-                 
  chairman Frank called  for objections.  No  objection having                 
  been raised, Amendment No. 72 was ADOPTED.                                   
                                                                               
  AMENDMENT NO. 36                                                             
                                                                               
  Senator  Zharoff explained  that  the  amendment  would  add                 
  $600.0 in  general fund  program receipts  to the solid  and                 
  hazardous  waste  management  component   in  the  Dept.  of                 
  Environmental Conservation budget.   Restoration would allow                 
  for development of a solid waste permitting program to avoid                 
  implementation of  federal  regulations.    Inclusion  would                 
  increase  Senate  funding over  the  amount provided  by the                 
  House.  Annalee McConnell concurred  that the House effected                 
  a $200.0 cut.                                                                
                                                                               
  GENE   BURDEN,   Commissioner,   Dept.    of   Environmental                 
  Conservation, came before committee.   He explained that the                 
  $600.0 in program receipts would  be generated by fees  from                 
  municipal disposal sites and costs  associated with closeout                 
  of "drilling  mud pits" on the North Slope, Kenai Peninsula,                 
  and other locations.   Co-chairman Frank explained  that the                 
  subcommittee asked that the department reassess programs for                 
  both solid waste and air quality in an effort to reduce both                 
  programs.    Intent  language  provides  the  department  an                 
                                                                               
                                                                               
  opportunity  to come  to LBA  to receive  and  expend "these                 
  funds."  He advised that the  legislature wants the state to                 
  maintain primacy.   Subcommittee funding  is intended to  do                 
  that with the least amount possible so that fees will be the                 
  least onerous.  He acknowledged that  fees will be higher if                 
  the federal government takes over.                                           
                                                                               
  Discussion  followed  regarding  the source  of  fees.   Co-                 
  chairman Frank acknowledged need to see and review a list of                 
  communities and fees paid for approval of dump sites.                        
                                                                               
  [The  following  portion of  the  meeting was  not recorded.                 
  Minutes reflect transcription of shorthand notes.]                           
                                                                               
  Commissioner   Burden  expressed   concern   that  lack   of                 
  sufficient  funding  may  cause  delay  in getting  the  air                 
  quality  program  started.   He  expressed  further  concern                 
  regarding  problems in  obtaining  program receipt  approval                 
  through the Legislative Budget and Audit Committee.                          
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 36.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 37                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 37.  Co-                 
  chairmen  Frank  and Halford  OBJECTED.   Co-chairman  Frank                 
  spoke in opposition  to the $1.1 million addition in general                 
  fund  program  receipts  to   the  air  quality   management                 
  component in the Dept. of Environmental Conservation budget,                 
  reiterating remarks  made in  connection with  Amendment No.                 
  36.  He then called for a show of hands  on the motion.  The                 
  motion FAILED on a vote of 2 to 5.                                           
                                                                               
  End:      SFC-95, #37, Side 2                                                
  Begin:    SFC-95, #39, Side 1                                                
                                                                               
  [The following  minutes reflect  transcription of  the tape-                 
  recorded meeting.]                                                           
                                                                               
  AMENDMENT NO. 74                                                             
                                                                               
  Senator  Donley  MOVED  for adoption  of  Amendment  No. 74.                 
  Senator Sharp OBJECTED.   Senator  Donley voiced his  belief                 
  that funding  the air  quality management  component in  the                 
  Dept.  of  Environmental  Conservation  budget  at  $5,871.4                 
  represents a higher  priority than  funding for the  storage                 
  tank assistance fund.  Co-chairman  Frank called for a  show                 
  of hands.  The motion FAILED on a  vote of 1 to 5.  (Senator                 
  Zharoff did not appear to vote.) [See also, p. 43.]                          
                                                                               
  AMENDMENT NO. 38                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 38.                 
                                                                               
                                                                               
  Senator Sharp OBJECTED.  Senator  Zharoff explained that the                 
  amendment  would  restore  $200.0  in  general fund  program                 
  receipts  removed  from the  personal  services line  in the                 
  Seattle  Alaska Seafood  Marketing  Institute office  of the                 
  Dept.  of  Commerce  and Economic  Development  budget.   He                 
  voiced support for both Alaska hire and location of staff in                 
  Alaska.  He  further voiced his understanding  that in-state                 
  location had  been tried,  and need  for out-of-state  staff                 
  gravitated positions to Seattle.  A  move at this time could                 
  have  a  negative impact  on  marketing.   Co-chairman Frank                 
  called for a show of hands.  The motion FAILED on a vote  of                 
  1 to 6.                                                                      
                                                                               
  AMENDMENT NO. 39                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 39.  Co-                 
  chairman Halford  OBJECTED.  Senator Zharoff  explained that                 
  the amendment would  restore the  $200.0 general fund  match                 
  for the Alaska  Seafood Marketing Institute.   The institute                 
  may be able to  receive an additional $1 million  in federal                 
  funds  through  use   of  match   moneys.    Senator   Sharp                 
  acknowledged  the   potential  match   but  explained   that                 
  institute staff advised of past overestimates.  Subcommittee                 
  funding merely  lowered the  match to  what staff  indicated                 
  federal funds might be.   Intent language specifies  that if                 
  additional federal moneys are forthcoming, the institute may                 
  go before  Legislative  Budget and  Audit  and "get  a  pass                 
  through."                                                                    
                                                                               
  GUY  BELL,  Director,   Administrative  Services,  Dept.  of                 
  Commerce   and   Economic   Development,  acknowledged   the                 
  uncertainty  of federal  moneys  flowing to  ASMI.   At  the                 
  current funding level, the institute has "sufficient minimum                 
  level match for about  a $6 million federal grant,  which is                 
  about what is  anticipated."  Mr. Bell  further acknowledged                 
  institute concern regarding the signal reduced match funding                 
  sends to  the federal  government.   The federal  government                 
  likes to see a  larger than minimum match  put forth by  the                 
  institute.   Senator Zharoff cautioned  against sending that                 
  message.                                                                     
                                                                               
  Co-chairman  Halford  asked if  language  could  be included                 
  within the budget to "put in  the availability of match that                 
  is  clearly  contingent  on actual  receipt  of  the federal                 
  funds."  There would  then be no loss but also  no potential                 
  use of the funds  other than for a federal match.   Mr. Bell                 
  voiced  his  belief that  the  foregoing  could occur  in  a                 
  restricted, separate, front section appropriation.                           
  Senator Sharp asked  if program  receipts could provide  the                 
  match.   Mr. Bell voiced  his understanding that  past match                 
  moneys have come from the  general fund.  He advised of  two                 
  or  three  program  receipt assessments  on  processors  and                 
  fishermen, collected by  the state on  behalf of ASMI.   The                 
  assessment  on fishermen is required to be used for domestic                 
                                                                               
                                                                               
  salmon marketing.   It could  thus not be  used for  foreign                 
  marketing--the   thrust  of  the   federal  receipts.    The                 
  assessment  on  processors  is  also  used  exclusively  for                 
  domestic marketing.    Mr. Bell deferred  comment on whether                 
  it could be  used for  foreign marketing to  staff from  the                 
  institute.                                                                   
                                                                               
  ART   SCHHEUNEMANN,   Executive  Director,   Alaska  Seafood                 
  Marketing   Institute,  Dept.   of  Commerce   and  Economic                 
  Development, came before  committee.  He explained  that the                 
  board  would  decide  whether  or not  to  direct  funds  to                 
  matching purposes.                                                           
                                                                               
  Senator Zharoff asked  if new language and  an appropriation                 
  in the  front section of the budget would be necessary.  Co-                 
  chairman Frank asked that  Amendments 39 through 41  be HELD                 
  pending receipt of an answer to the question. [See pages 55-                 
  56 for action on Amendments 39 through 41.]                                  
                                                                               
  AMENDMENT NO. 42                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 42 which                 
  would add intent  language requiring relocation of  all out-                 
  of-state Alaska Seafood Marketing Institute employees within                 
  Alaska  by  December  30,  1995.   Senator  Sharp  OBJECTED.                 
  Senator  Rieger  suggested  that   as  the  program  becomes                 
  increasingly self-supporting it  is not appropriate  for the                 
  legislature  to  "call  the  shots  in  this  much  detail."                 
  Senator  Zharoff  acknowledged  that he  did  not  know what                 
  impact relocation  might  have upon  marketing  efforts  and                 
  suggested amending the intent to  require relocation by June                 
  30, 1996.   That would provide opportunity for review during                 
  the  1996  session.    Senator  Rieger suggested  that  more                 
  detailed analysis could  occur if  a request for  additional                 
  program  receipts is  made  through the  RPL process  to the                 
  Legislative  Budget and  Audit Committee.    Senator Zharoff                 
  questioned  whether  LBA  would  have  authority   to  delay                 
  relocation should it appear prudent.                                         
                                                                               
  Further  discussion  followed  regarding  whether  the  date                 
  should be December or June.   Co-chairman Frank called for a                 
  show of  hands on Amendment No. 42.   The motion FAILED on a                 
  vote of 1 to 6.                                                              
                                                                               
  AMENDMENT NO. 87                                                             
                                                                               
  Senator Sharp MOVED  for adoption of  Amendment No. 87.   He                 
  explained that  it would  restore $1  million to  commercial                 
  fisheries,  regional  and statewide  administration,  in the                 
  Dept.  of Fish  and Game  budget.  Senator  Donley OBJECTED,                 
  asking  how  the addition  would fit  within  the cap.   Co-                 
  chairman  Frank  advised that  it would  go beyond  the cap.                 
  Senator Donley referenced lack of willingness to add funding                 
  to public  protection programs  such as  occupational safety                 
                                                                               
                                                                               
  and probation due  to need to remain  within caps.  He  then                 
  questioned  the priority, fairness,  and lack of consistency                 
  associated with the proposed  addition.  Co-chairman Halford                 
  noted a  reduction of over $5  million in the  Dept. of Fish                 
  and Game  budget.  Restoration  of $1 million  to commercial                 
  fisheries does not achieve last  year's spending level.  The                 
  commercial fishery is  a generator  of revenue  in terms  of                 
  employment, payroll, and economic  activity.  Senator  Sharp                 
  added that, with the increase, commercial  fisheries funding                 
  remains $789.5 below that of FY 95.                                          
                                                                               
  FRANK RUE, Commissioner, Dept. of Fish and  Game came before                 
  committee and cited  areas within commercial  fisheries that                 
  would be  cut under the  Senate budget.   Further discussion                 
  followed   between  Co-chairman   Frank  and   GERON  BRUCE,                 
  Legislative Liaison, Dept.  of Fish and Game,  regarding raw                 
  fish tax receipts.   Additional discussion ensued concerning                 
  whether  the  cost  of  commercial  fisheries  management is                 
  offset by jobs,  revenues, and  economic activity.   Annalee                 
  McConnell stressed that  Alaska fisheries are  priorities in                 
  administrative attempts to  diversify the state economy  and                 
  promote greater economic development and jobs.                               
                                                                               
  Senator Donley stressed that lack of funding for enforcement                 
  of  work  place  safety  presents  a "real  endangerment  to                 
  private enterprise in  this state."  The  only justification                 
  for not providing  adequate funding  has been an  artificial                 
  cap.  He  again questioned funding priorities.   Co-chairman                 
  Halford reiterated that the  $27 million commercial  fishery                 
  budget generates approximately $100 million  in revenue.  As                 
  an  employer, it ranks with tourism and oil and gas in terms                 
  of  the number  of jobs  and the  payroll that flows  to the                 
  private sector.                                                              
                                                                               
  Senator Phillips  concurred  in  Senator  Donley's  argument                 
  regarding  priorities and asked  if the $1  million could be                 
  taken from another area of the budget.                                       
                                                                               
  Senator  Zharoff  stressed  need  for  adequate  funding  in                 
  commercial fisheries,  advising that  it impacts  commercial                 
  fishermen,  sport  fishermen,  personal-use  fishermen,  and                 
  subsistence.  It also impacts the  resource.  He attested to                 
  need  for an  adequate  assessment  mechanism  for  managing                 
  openings and closings, apportioning the resource  among user                 
  groups,   and   generating   statistics  for   international                 
  negotiations.      Senator  Phillips  advised  that resource                 
  protection  is  one   of  the  highest  priorities   of  his                 
  constituents.  He nonetheless expressed reluctance to exceed                 
  the established  cap and advised that he  would vote against                 
  the proposed amendment unless the  $1 million addition could                 
  be  taken  from elsewhere  in  the  budget.   Senator  Sharp                 
  stressed   that   the  division   of   commercial  fisheries                 
  represents the  only division  that has  been successful  in                 
  managing for abundance.                                                      
                                                                               
                                                                               
  Co-chairman  Frank asked that  the amendment  be temporarily                 
  withdrawn, saying that the committee would return to it at a                 
  later time.   Senator  Sharp MOVED  to temporarily  withdraw                 
  Amendment  No.  87.   Co-chairman  Frank  directed  that the                 
  meeting  be  briefly recessed.    [See below  for subsequent                 
  action.]                                                                     
                                                                               
                       RECESS - 5:10 P.M.                                      
                      RECONVENE - 5:45 P.M.                                    
                                                                               
  AMENDMENT NO. 87                                                             
                                                                               
  Upon  reconvening the  meeting,  Co-chairman Frank  directed                 
  that Amendment No. 87 again be brought on for consideration.                 
  He then called for objections to  addition of $1 million for                 
  commercial  fisheries.    Senator Phillips  OBJECTED.    Co-                 
  chairman Frank called for a show of hands.  Amendment No. 87                 
  was ADOPTED on a vote of 6 to 1.                                             
                                                                               
  AMENDMENT NO. 43                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 43.  Co-                 
  chairman  Halford  and  Senator  Sharp  OBJECTED.    Senator                 
  Zharoff  explained  that  addition  of  $400.0  to  economic                 
  development   in  the   Dept.  of   Commerce  and   Economic                 
  Development budget would  restore funding to  the Governor's                 
  amended  level.     Funding  pertains  to  Alaska   Regional                 
  Development   Organizations   (ARDORS).   The   subcommittee                 
  decrease represents 45% of the funding and  will have severe                 
  negative impacts on economic development.  The ARDOR program                 
  provides a  statewide forum for  networking that strengthens                 
  less  developed   regions  and   bridges  rural   and  urban                 
  interests.   Annalee McConnell advised of the administrative                 
  focus on economic development and  suggested that investment                 
  would   be   evidenced   in  increased   jobs   in  impacted                 
  communities.  Co-chairman  Frank called for a show of hands.                 
  The motion FAILED on a vote of 1 to 6.                                       
                                                                               
  AMENDMENT NO. 44                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 44.  Co-                 
  chairman Frank OBJECTED, advising  of his recollection  that                 
  funding   for  the  Alaska   Police  Standards  Council  was                 
  previously dealt with  in Amendment No. 14.   Senator Rieger                 
  concurred.   He  explained that  funding for  FY  95 totaled                 
  $274.0.   A  prior amendment  added $130.0  to the  council.                 
  That represents half-year  funding at  the current level  of                 
  operations.  It reflects  bridge money to "get to  the point                 
  where program receipts can start to be collected."                           
                                                                               
  DEL SMITH, Deputy Commissioner, Dept. of Public Safety, came                 
  before committee.   He explained  that the $259.1  contained                 
  within  Amendment  44  would fund  two  positions  in police                 
                                                                               
                                                                               
  standards  that  currently  certify and  monitor  900 police                 
  officers.   Beginning January  1, 1996,  a ticket  surcharge                 
  will accrue to the council to be used, statewide, for police                 
  training.                                                                    
                                                                               
  End:      SFC-95, #39, Side 1                                                
  Begin:    SFC-95, #39, Side 2                                                
                                                                               
  In  response  to a  question  from Senator  Zharoff, Senator                 
  Rieger explained that general funding  would conclude at the                 
  end of December, 1995.  Program receipts begin in January of                 
  1996.    They  are expected  to  total  approximately $300.0                 
  annually.  Intent language allows for use of the full amount                 
  of  the  Governor's  program  receipt  request.   Mr.  Smith                 
  acknowledged  that   $350.0  in  program  receipts  will  be                 
  directed toward statewide police training, per passage of HB                 
  319  last  year.    Senator  Zharoff  asked  if  the  $259.1                 
  contained  within  the amendment  is  necessary.   Mr. Smith                 
  advised of FY 95 funding of $274.0.  Amendment No.  14 funds                 
  the function for one-half  year.  Mr. Smith said  he did not                 
  know whether  the department  has authority  to utilize  the                 
  program receipts to continue operations.                                     
                                                                               
  Co-chairman Frank called for  a show of hand on  adoption of                 
  Amendment No. 44.   The motion FAILED  on a vote  of 1 to  5                 
  (Senator Donley did not appear to vote).                                     
                                                                               
  AMENDMENT NO. 45                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 45.  Co-                 
  chairman Frank OBJECTED.  Senator Zharoff explained that the                 
  amendment would  restore the personal  services decrement to                 
  Alaska State Troopers,  Detachments, in the Dept.  of Public                 
  Safety budget.   The subcommittee  budget relies on  federal                 
  interagency   receipts   (helmet   money)   that   may   not                 
  materialize.   FY  95 funding  for  public safety  was $30.5                 
  million.   The Governor requested  $32.2 million.  The House                 
  provided  $31.3,  and  the  Senate figure  is  $30.8.    The                 
  proposed addition of $1,845.9 would  raise the Senate number                 
  to $32.7.   Senator  Zharoff asked  that the  administration                 
  respond to the proposal.                                                     
                                                                               
  DEL  SMITH,  Deputy  Commissioner, Dept.  of  Public Safety,                 
  again  came  before  committee.     He  explained  that  the                 
  department will  apply for  federal highway  safety planning                 
  funds totaling $1.6  million.  The  state is competing  with                 
  ten other state agencies.   The state share of  $5.4 million                 
  in helmet moneys represents 60%.  Forty percent must flow to                 
  local municipalities.  There is approximately $10 million in                 
  requests  for  $5.4  million  in  available  funding.    The                 
  department could  seek a $1.6  million grant to  cover three                 
  years.   That would provide $600.0 per  year for a number of                 
  positions.  Application for $1.6 million for one  year would                 
  be  frowned upon  by the  federal  agency.   Senator Zharoff                 
                                                                               
                                                                               
  asked what would happen  if the grant is not received.   Mr.                 
  Smith advised of  substantial impact and layoffs  within the                 
  division.                                                                    
                                                                               
  Annalee McConnell stressed the risky nature of assuming that                 
  federal moneys will replace general  fund dollars when it is                 
  known that federal  moneys will not  be forthcoming in  that                 
  amount.  That risk may be  appropriate in some instances but                 
  not for public  safety.   She urged that  the committee  not                 
  substitute unknown federal dollars for general funds.                        
                                                                               
  In  response  to a  question  from Co-chairman  Halford, Ms.                 
  McConnell reiterated  that it  would be  reasonable for  the                 
  department to receive $1.6 million  for a three-year period.                 
  That amount  is not likely to be provided for a single year.                 
  These are pilot  projects.   One-third of  the funding  each                 
  year is reasonable.                                                          
                                                                               
  Discussion followed  regarding measures that might  be taken                 
  to  fill  the  $1.6  million  budgetary  hole.    Mr.  Smith                 
  referenced 32 court service officers and four troopers as an                 
  example  of dollar  reductions that would  have to  be made.                 
  Co-chairman Halford noted that, working from past conference                 
  committee and  supplemental funding, the reduction  would be                 
  $700.0 rather than the full $1.6 million.                                    
                                                                               
  Senator Rieger spoke  to subcommittee reasoning at  the time                 
  the  budget was developed.   He noted, specifically, a $2.74                 
  increase  in  helmet  money  between  FY  95  and  96.    He                 
  acknowledged the risk  as well  as need to  remain within  a                 
  restrictive  cap.    Annalee   McConnell  advised  that  for                 
  planning purposes,  the department could  expect $600.0 from                 
  the planning grant.                                                          
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 45.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 46                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 46.  Co-                 
  chairman Frank OBJECTED.  Senator Zharoff explained that the                 
  amendment   would   switch  the   funding  source   for  the                 
  enforcement component of fish and wildlife protection in the                 
  Dept. of Public  Safety budget from  fish and game funds  to                 
  general funds.   Annalee McConnell  attested to support  for                 
  the change.  Current subcommittee  funding would merely draw                 
  down  the  fish  and game  fund  but  not  for the  purposes                 
  originally established.                                                      
                                                                               
  Discussion  followed  concerning  whether  funds  from   the                 
  constitutionally   established  fish   and  game   fund  had                 
  previously been  used for enforcement.   Co-chairman Halford                 
  voiced  his  understanding that  moneys  from the  fund flow                 
  through the commercial fisheries  component and are utilized                 
                                                                               
                                                                               
  for enforcement through  the Dept. of  Fish and Game  rather                 
  than the Dept. of Public Safety.                                             
                                                                               
  FRANK RUE, Commissioner, Dept. of Fish and Game, again  came                 
  before committee.   He explained  that moneys from  the fund                 
  are  utilized  for special  projects  within the  commercial                 
  fisheries component.  It  is used for crab  management since                 
  most  fines  and  forfeitures  are  from the  crab  fishery.                 
  Criminal  fines  go  into  the  general  fund.    Fines  and                 
  forfeitures from the fishery go into the fish and game fund.                 
  Co-chairman Frank voiced his understanding that  enforcement                 
  officers within the Dept. of Public Safety actually make the                 
  arrests for fishing violations.  He  then asked why fish and                 
  game  funds could  not  be  used  for  enforcement  by  that                 
  department.   Commissioner  Rue acknowledged  that  fine and                 
  forfeiture  moneys  could be  so  utilized.   However, these                 
  moneys  are now slated for crab  management within the Dept.                 
  of Fish and Game budget.                                                     
                                                                               
  Senator Rieger advised  that the $555.0 shown  in the budget                 
  and in the proposed amendment is  the amount estimated to be                 
  in  the   fish  and   game  fund   sub-account  (fines   and                 
  forfeitures) as of  June 30, 1996.   It is not funding  that                 
  will be  utilized by  the department  during FY  96 but  the                 
  balance expected  to be  in the account  at the  end of  the                 
  fiscal   year.     KEVIN  BROOKS,   Director,  Division   of                 
  Administrative Services, Dept. of Fish and Game, came before                 
  committee.   He suggested that  it would be inappropriate to                 
  utilize the estimated balance in budgeting because in making                 
  the estimate  the  department merely  matched  revenues  and                 
  expenditures.  It is impossible, at this point, to determine                 
  what kind of revenue will flow  into the fish and game  fund                 
  during FY 96.   The projected year-end balance for  FY 95 is                 
  $513.0.  The FY 96 request was based on an available balance                 
  in the fund.  The current problem with the  Senate budget is                 
  that appropriations for  two departments (Dept. of  Fish and                 
  Game  and  Dept. of  Public Safety)  are  based on  the same                 
  balance.   Annalee McConnell advised that  amounts collected                 
  from fines and  forfeitures vary  considerably from year  to                 
  year and are not easily predicted.                                           
                                                                               
  Co-chairman Halford noted that options appear to require the                 
  spread  of  a $555.0  reduction within  the Dept.  of Public                 
  Safety, a $555.0 reduction in the Dept. of Fish and Game, or                 
  a change of  revenue source  to general funds.   The  latter                 
  would increase the overall number by half a million dollars.                 
  Co-chairman Frank asked  that Amendment No. 46  be WITHDRAWN                 
  pending additional work on the  issue by Co-chairman Halford                 
  and Senator Rieger.   [See page  53 and 4/20/95 minutes  for                 
  subsequent action.]                                                          
                                                                               
  AMENDMENT NO. 47                                                             
                                                                               
  Senator Donley MOVED for adoption of  Amendment No. 47.  Co-                 
                                                                               
                                                                               
  chairman Frank OBJECTED.  Senator  Donley advised of serious                 
  consequences from  underfunding of  the occupational  safety                 
  and health budget, and  he stressed that worker safety  is a                 
  legitimate priority of state government.                                     
                                                                               
  Co-chairman   Halford   inquired   regarding   previous-year                 
  funding.  JERRY BURNETT, aide to Senator Phillips, explained                 
  that funding represents an 8%  reduction from the Governor's                 
  requested level for the entire component.  Annalee McConnell                 
  said that  general funds  for the  component in the  current                 
  budget  total $276.0.   To  an earlier  indication that  the                 
  department "offered up $30.0,"  Ms. McConnell clarified that                 
  the department raised concern that  the amount suggested was                 
  below the cap by $36.0.  There was no indication that  $36.0                 
  would take care of the concern.                                              
                                                                               
  Ms.  McConnell further  advised that  Alaska statutes  cover                 
  areas where federal statutes do not provide protection.  One                 
  relates  to  hazardous  materials   (asbestos  and  paints).                 
  Another  relates to industries (agriculture) that are exempt                 
  from federal regulations.   When  inspections are  conducted                 
  for federal purposes, general funds allow for inspection for                 
  compliance  with state  statutes as  well.  Lack  of general                 
  funds will  preclude inspection for statutory  compliance in                 
  areas not covered by federal law.                                            
                                                                               
  Senator Zharoff inquired  concerning the liability  to which                 
  the  state might  be exposed  due to  failure  to adequately                 
  enforce  standards.    He  cited  the fishing  industry  and                 
  cannery  work   as  an   example.     ED  FLANAGAN,   Deputy                 
  Commissioner, Dept.  of Labor,  came before  committee.   He                 
  advised that  he could  not speak  to  strict liability  but                 
  noted that the department is subject to complaints, "against                 
  our  program administration with the federal government," if                 
  the state does  not meet industry  needs.  The general  fund                 
  match  enables   the  department  to  meet  minimum  federal                 
  staffing  requirements.  He  reiterated that  state statutes                 
  that  go  beyond federal  law must  also  be enforced.   The                 
  program has gone  from $276.0 in unrestricted  general funds                 
  to  zero in the  Senate budget.   That will  be difficult in                 
  light  of  past federal  reductions  and the  probability of                 
  further federal reductions next year.                                        
                                                                               
  Co-chairman  Frank  asked if  a  general reduction  would be                 
  preferable. Mr.  Flanagan advised that the  department would                 
  probably  take the  reduction  "where the  subcommittee came                 
  out."  Co-chairman Halford referenced total FY 95 authorized                 
  funding  of  $33,516.8   and the  FY  96 Senate  proposal of                 
  $35,512.0 and asked  where the overall increase  in spending                 
  would go.  NANCY  SLAGLE, Director of Budget Review,  Office                 
  of Management and Budget, advised of a $182.0 increment from                 
  program receipts.   That was specifically for  acquiring and                 
  selling OSHA regulations.  ARBE WILLIAMS, Director, Division                 
  of  Administrative Services,  Dept.  of  Labor, came  before                 
                                                                               
                                                                               
  committee.    She  noted an  increment  of  approximately $1                 
  million in federal authorization in the  employment security                 
  division.   Two grant  lines were also  increased a combined                 
  total of approximately  $1 million  for moneys flowing  into                 
  the  fish fund  and STEP.   Annalee McConnell  stressed that                 
  increases in  federal funds do  not allow the  department to                 
  deal with compliance  issues for  activities and  industries                 
  that  are  not  covered  by  federal  OSHA  standards.   Ms.                 
  Williams  added that increases  occurred in components other                 
  than OSHA.  Co-chairman Halford suggested that general funds                 
  could  be shuffled  out  of components  receiving  increased                 
  federal moneys and used for state inspections.  Ms. Williams                 
  acknowledged  $13.0  in  general  funds  in  the  employment                 
  security program.  It  provides a match for the  Alaska work                 
  program. There is also $39.0 for the Governor's committee on                 
  employment  of  people  with  disabilities.    Mr.  Flanagan                 
  remarked that general funds have been "pretty well wrung out                 
  of all our BRUs."                                                            
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No.  47.  The motion FAILED  on a vote of  2 to 5.                 
  [See page 59 for further discussion.]                                        
                                                                               
  AMENDMENT NO. 48                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 48.                 
  OBJECTION was raised.   Senator  Zharoff explained that  the                 
  amendment  would  restore  general   fund  program  receipts                 
  deleted from the occupational safety and health component in                 
  the Dept. of Labor  budget.  The restored $182.5  would fund                 
  resale of federal regulations.   Annalee McConnell said that                 
  the  service would  make  federal publications  available to                 
  Alaskan  employers.   It  does not  require  use of  general                 
  funds.    If the  service  is not  provided,  employers will                 
  purchase   these  materials   directly   from  the   federal                 
  government and pay  an increased cost of 25%.   The state is                 
  able  to  offer  the  materials  at  a  discount.    Annalee                 
  McConnell stressed  that the  cost of  the program  would be                 
  covered through sale of the materials.  No general funds are                 
  involved.                                                                    
                                                                               
  Discussion of promulgation  of federal regulations and  need                 
  by employers to update materials followed.                                   
                                                                               
  Senator Zharoff  asked that  the amendment  be HELD  pending                 
  later consideration.   [See pages 56  and 59 for  subsequent                 
  discussion and action.]                                                      
                                                                               
  AMENDMENT NO. 49                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 49.                 
  Senator Sharp OBJECTED.  Senator  Zharoff explained that the                 
  $30.0  addition  would  restore  the  increment  for   rural                 
  veterans services included in  the Governor's amended budget                 
                                                                               
                                                                               
  for the  Dept.  of  Military and  Veterans  Affairs.    JEFF                 
  MORRISON,  Director,  Administrative  and Support  Services,                 
  Dept.  of Military  and Veterans  Affairs, informed  members                 
  that the new program was included  in the amended budget due                 
  to recognition  that a  considerable number  of veterans  in                 
  rural  Alaska are  not  currently served  by  the VSO  grant                 
  program and are  unaware of  many of their  benefits.   Past                 
  documentation  indicates that  the "return  directly  to the                 
  veterans,  in terms of increased federal benefits, is in the                 
  range of 35-50  to 1."   Census studies  indicate there  are                 
  approximately  12,000  veterans  located  outside  of  urban                 
  areas.                                                                       
                                                                               
  End:      SFC-95, #39, Side 2                                                
  Begin:    SFC-95, #41, Side 1                                                
                                                                               
  Senator Phillips  advised that  he spoke  with veterans  who                 
  indicated they did  not want the special  assistant position                 
  if it would mean  taking $25.0 out of the  veterans program.                 
  He  suggested it  might be  possible to  delete the  special                 
  assistant  and fund rural  outreach.  Mr.  Morrison said the                 
  special assistant position is high on  the list of needs and                 
  desires  of the  new  Commissioner.   With  deletion of  the                 
  division director  position several years ago,  attention to                 
  the  veterans  program has  been  dismal.   Senator Phillips                 
  suggested that he  had received mixed signals  from veterans                 
  and asked that the amendment  be HELD pending clarification.                 
  [See page 57 for subsequent action.]                                         
                                                                               
  AMENDMENT NO. 50                                                             
                                                                               
  Co-chairman Frank  voiced  his  understanding  that  similar                 
  intent  relating  to  disaster relief  funding  through  the                 
  disaster   declaration   process   and   submission   of   a                 
  supplemental request  for FY  96 disaster  relief costs  was                 
  before the subcommittee for incorporation within the budget.                 
  He acknowledged subcommittee intent to fund  disaster relief                 
  through the supplemental  process.  He noted  need to review                 
  disaster   declaration   requirements    and   voiced    his                 
  understanding  that  language  requires   consultation  with                 
  presiding legislative officers.   NANCY SLAGLE,  Director of                 
  Budget Review, Office of Management and Budget, told members                 
  that if the  cost of  the disaster is  anticipated to  total                 
  over $1 million, the President of  the Senate and Speaker of                 
  the House are notified.                                                      
                                                                               
  Annalee McConnell  acknowledged her  understanding that  the                 
  House and Senate  are interested  in funding both  disasters                 
  and fire suppression through the supplemental process rather                 
  than  through  up-front  funding.   She  explained  that the                 
  administration  continues to  recommend funding  through the                 
  normal  budget  process  because the  state  has  been in  a                 
  position where it was unable  to pay disaster-related bills.                 
  Payment   became  caught   in  that   period  between   when                 
                                                                               
                                                                               
  expenditures needed to  be made and supplemental  action was                 
  taken  by  the legislature.    That  will become  more  of a                 
  problem as cash becomes tighter and tighter.   Ms. McConnell                 
  acknowledged legislative concern over  expenditure of moneys                 
  by the administration  when it is  not authorized to do  so.                 
  The state would have no choice but to be in that position if                 
  funding is to be provided via supplemental.  Senator Zharoff                 
  noted passage of legislation requiring the state to  pay its                 
  bills  within 30 days  or incur penalty.   Co-chairman Frank                 
  noted statutory provisions  which allow the Governor  to use                 
  "any  available funds"  to  pay emergency  bills.   He  then                 
  directed  that  the  amendment  be  HELD pending  review  of                 
  statutory  disaster  declaration  language.    [See  4/20/95                 
  minutes for further action on this amendment.]                               
                                                                               
  AMENDMENT NO. 51                                                             
                                                                               
  Co-chairman   Frank  voiced   his  understanding   that  the                 
  committee  had already taken action  on decreases in the oil                 
  and gas development  component within  the Dept. of  Natural                 
  Resources.    He  then  noted that  Amendment  No.  51 would                 
  restore $100.0 in general funds.  Senator Zharoff MOVED  for                 
  adoption.    Co-chairman  Frank  OBJECTED,  saying that  the                 
  department  could  handle  the  relatively  small  reduction                 
  within the $4  million budget.   Senator Zharoff noted  that                 
  the  reduction  would  result in  fewer  offerings  and less                 
  revenues  to the state.  Annalee McConnell stressed need for                 
  conduct of lease sale analysis as  quickly as possible.  She                 
  further stressed  need for  economic development  on a  more                 
  equitable  and  expedited  basis  than  in  the past.    The                 
  administration  would  prefer  to  be  able  to  spread  the                 
  reduction rather than target it to one area.                                 
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment  No. 51.  The  motion FAILED on  a vote of  1 to 5                 
  (Senator Donley did not appear to vote.)                                     
                                                                               
  AMENDMENT NO. 52                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 52.  Co-                 
  chairman Frank OBJECTED.  Senator Zharoff explained that the                 
  amendment would restore two lead accountant positions within                 
  the budget for the Dept. of Natural Resources.  It would add                 
  $175.8  in  general  funds  to  the administrative  services                 
  component  in  the  management and  administration  BRU  and                 
  replace $175.8  in general funds  with agriculture revolving                 
  loan funds within the  agricultural development component of                 
  the resource  development BRU.   Without  the two  positions                 
  which collect and account for  the department's $800 million                 
  in revenues,  the state stands  to lose direct  revenues and                 
  incur significant  audit  exceptions and  IRS penalties  for                 
  non-compliance.                                                              
                                                                               
  Annalee McConnell  advised of  the Governor's  commitment to                 
                                                                               
                                                                               
  both resolution of past problems with oil and gas accounting                 
  and move-ment  toward expeditious,  effective, and  accurate                 
  collections.  The subcommittee reduction goes beyond what is                 
  appropriate for good collection of revenues.                                 
                                                                               
  JEFF HARTMAN, Assistant  Director, Administrative  Services,                 
  Dept.  of  Natural  Resources,  came   before  committee  in                 
  response to  a question from  Senator Donley.   He explained                 
  that the original  cut of $255.8 in  administrative services                 
  specifies elimination of the three  top positions within the                 
  division.  He noted that  the director position is presently                 
  vacant.    One of  the  positions  is in  charge  of revenue                 
  accounting in Anchorage  and accounts  for revenues of  $800                 
  million a year.  The second position is filled by Nico  Bus.                 
  Mr.  Hartman  advised  that  he,  himself, fills  the  third                 
  position.  The commissioner  would prefer to fund  the three                 
  positions from general funds from  the plant material center                 
  and replace general  funds for  the center with  agriculture                 
  revolving loan funds.                                                        
                                                                               
  In response to a question from Senator Donley, Ms. McConnell                 
  said the  Dept. of Natural Resources is  the largest revenue                 
  collector  overall.    Collections  stem  from oil  and  gas                 
  revenues, timber sales, land payments, park fees, etc.                       
                                                                               
  Senator  Zharoff  stressed  that  the   net  impact  of  the                 
  amendment is zero.   Co-chairman Frank called for a  show of                 
  hands on adoption of Amendment No. 52.  The motion FAILED on                 
  a vote of 2 to 5.                                                            
                                                                               
  Following the vote,  Senator Donley  asked why the  proposed                 
  change in funding sources was not  a good idea.  Co-chairman                 
  Frank noted  that the  agriculture revolving  loan fund  has                 
  been raided over the years.   Further withdrawals should not                 
  be made.  The  component has $1.9 million in  total funding,                 
  and one of the positions is presently vacant.                                
                                                                               
  AMENDMENT NO. 53                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 53.  Co-                 
  chairman Frank  OBJECTED.   Senator  Zharoff explained  that                 
  transfer of  $75.0 in general  funds for the  plant material                 
  center to the  land development - public  information center                 
  component within the  resource development BRU of  the Dept.                 
  of Natural Resources  and replacement  of the general  funds                 
  for agricultural development with agriculture revolving loan                 
  funds  would  restore  the  reduction  to  the  department's                 
  customer services entity.   The  public wants more  service,                 
  not less.  Without the requested funding, the department may                 
  have to  close the center.   That would mean a  reduction in                 
  program  delivery to  land  contract administration,  mining                 
  claims, parks, water, and  other programs as well as  a loss                 
  of "one-stop" convenience for the public.                                    
                                                                               
                                                                               
  Jeff Hartman again came before committee.  He noted that the                 
  budget  for   the  center   is  $220.0.     The   department                 
  investigated a reduction in the hours the center is open and                 
  found that center operations are at a minimum.   Co-chairman                 
  Frank said that the  subcommittee reviewed the five-position                 
  component and felt adjustments could be made to operate with                 
  four.                                                                        
                                                                               
  Further  discussion  followed   regarding  location  of  the                 
  center, the  impact of  closure of  the central  information                 
  office, and  assumption of service  center functions  within                 
  individual divisions.                                                        
                                                                               
  Mr. Hartman referenced  the agriculture revolving loan  fund                 
  and noted that it contains  $7.2 million in cash.   The fund                 
  makes  approximately  20  loans a  year,  and  loans average                 
  $73.0.   Even with the transfer  envisioned in Amendment No.                 
  53, the fund will be able to make agricultural loans through                 
  the year 2002.   Senator Sharp  asked if the  fund would  be                 
  subject to sweep to repay  the constitutional budget reserve                 
  fund.  MIKE GREANY, Director,  Legislative Finance Division,                 
  suggested that the  fact that  it is a  revolving loan  fund                 
  removes it from the  sweep.  He advised that he  would check                 
  into the status and return  information to committee.  Nancy                 
  Slagle voiced her understanding that the administration  can                 
  make  expenditures  from  the  fund  without  an  additional                 
  appropriation.  Loans can be made for agricultural purposes.                 
  The fund does not fall under  the criteria of "available for                 
  appropriation."   Annalee McConnell clarified that moneys in                 
  the fund have already been  appropriated and do not  require                 
  further appropriation  for moneys to be  distributed through                 
  loans.    Because  there is  no  requirement  for additional                 
  appropriation by the legislature, the  funds are not subject                 
  to sweep.                                                                    
                                                                               
  Discussion  of appropriations  to the  agriculture revolving                 
  loan  fund  followed.    Mike  Greany noted  that  confusion                 
  results from a  front section provision in  the House budget                 
  which appropriates $50.0 from the agriculture revolving loan                 
  fund to the general fund as a special fund source.  There is                 
  no annual requirement for  a front section item to  recharge                 
  the fund.   It is  a statutory, stand-alone,  revolving loan                 
  fund.  Annalee McConnell  added that payments are  made from                 
  the  fund and  repayments  go directly  back into  the fund.                 
  That is the idea  behind the revolving concept.   Mr. Greany                 
  attested   to  past   appropriations   from  the   fund  for                 
  administrative  costs   within  the  department.     Further                 
  discussion   of  the   number  of  agricultural   loans  and                 
  administrative costs associated  with the  $20.6 million  in                 
  loans followed.                                                              
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 53.   The motion FAILED  on a vote  of 2 to  4                 
  (Senator Sharp was temporarily absent from the meeting).                     
                                                                               
                                                                               
  AMENDMENT NO. 54                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 54.  Co-                 
  chairman Frank OBJECTED.  Senator Zharoff explained that the                 
  amendment would add  $175.0 in general funds  from the plant                 
  material  center  to  the  information  resource  management                 
  component in  the management  and administration BRU  within                 
  the  budget  for the  Dept.  of  Natural  Resources.   Plant                 
  material  center  moneys   deleted  from  the   agricultural                 
  development component in the resource development BRU  would                 
  be replaced by  $175.0 in agriculture revolving  loan funds.                 
  He then asked  that the administration  speak to need.   Co-                 
  chairman  Frank  advised of  the subcommittee  approach that                 
  divisions  that require  services from  information resource                 
  management contribute  to  the component.   Senator  Zharoff                 
  suggested  that  the  Governor's  request  "was  down  seven                 
  positions already."   He then inquired regarding  a position                 
  count.                                                                       
                                                                               
  Annalee McConnell said  that, overall,  Senate numbers  were                 
  $9.4 million less than the Governor's request.  Commissioner                 
  Shively has  indicated he  would attempt  to  make the  cuts                 
  work.   However, he identified  a few areas where  he felt a                 
  high level of  service to the  public must be maintained  to                 
  foster  resource and  economic development.   That  includes                 
  geophysical services.  Mr. Hartman  further attested to need                 
  for the  automated land  plat, particularly  in relation  to                 
  mental health lands.                                                         
                                                                               
  End:      SFC-95, #41, Side 1                                                
  Begin:    SFC-95, #41, Side 2                                                
                                                                               
  In response to a question regarding the number of positions,                 
  Co-chairman  Frank   voiced  his   understanding  that   the                 
  operating budget  was not  reduced by seven  position.   The                 
  positions were funded by capital improvement  program funds.                 
  Reductions in  personnel were  made when  the capital  funds                 
  "ran out."  Mr. Hartman concurred.                                           
                                                                               
  Co-chairman Frank  called for a  show of hands  on Amendment                 
  No. 54.   The  motion FAILED on  a vote  of 2 to  4 (Senator                 
  Rieger was absent from the meeting).                                         
                                                                               
  AMENDMENT NO. 55                                                             
                                                                               
  Co-chairman Frank noted that Amendment  No. 55 is similar to                 
  Amendment No.  13  and would  thus  be WITHDRAWN.    Senator                 
  Zharoff concurred.                                                           
                                                                               
  AMENDMENT NO. 56                                                             
                                                                               
  Co-chairman  Frank advised  of  similar language  within the                 
  subcommittee  budget for  Dept.  of  Natural Resources  fire                 
                                                                               
                                                                               
  suppression.      Amendment   language   relating   to   the                 
  availability  of funding  through  the disaster  declaration                 
  process and via an  FY 96 supplemental has been  reworded to                 
  meet  department  needs.   The  Co-chairman said  he  had no                 
  problem with the  amended language.   Senator Zharoff  MOVED                 
  for adoption of Amendment No. 56.   Senator Sharp noted that                 
  the legislature has not always  funded the full supplemental                 
  request from  departments.   Co-chairman Frank  acknowledged                 
  that, but he  noted that the  option remains for the  coming                 
  year.  No objection having been raised, Amendment No. 56 was                 
  ADOPTED.                                                                     
                                                                               
  AMENDMENT NO. 57                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 57.  Co-                 
  chairman Frank OBJECTED,  noting that it would  increase the                 
  federal student  aid component  in the  Alaska Postsecondary                 
  Education  Commission of the Dept. of Education budget.  The                 
  subcommittee felt this  area should not be increased at this                 
  time due to  declining revenues.  Senator  Zharoff explained                 
  that the amendment would take  $39.6 from the WICHE  program                 
  and place it in federal student  aid.  The state educational                 
  incentive   grant   program  receives   approximately  1,400                 
  applications  per year and awards only  325 grants.  It is a                 
  needs-based  program for  low-income  students.   The Alaska                 
  Postsecondary  Education Commission  has  provided a  letter                 
  stating  that money is available due to students cycling out                 
  of  WICHE  and  unexpected  withdrawals.    If  passed,  the                 
  amendment would fund an additional 26 students.  Co-chairman                 
  Frank  referenced last year's  decision to  continue funding                 
  for ongoing WICHE  students but not  fund new students.   As                 
  existing students drop  out of WICHE, the  department sought                 
  to use available  WICHE funds  elsewhere.  The  subcommittee                 
  took  the  position that  funds not  needed to  maintain the                 
  state  commitment  to  existing  WICHE  students  should  be                 
  returned to the general fund.                                                
                                                                               
  JOE  McCORMICK,  Executive  Director,  Alaska  Postsecondary                 
  Education Commission, came before committee.  He attested to                 
  the fact  that money  from  WICHE used  instead for  federal                 
  student  aid  would  be  well  spent.     The  bulk  of  the                 
  applications  for  aid come  from very  low-income families.                 
  Students  must  demonstrate  exceptional  financial need  to                 
  qualify.    The  federal  match  is   approximately  $163.0.                 
  Senator  Zharoff  asked  if  provision  of the  $39.6  would                 
  generate  additional   federal  dollars.     Mr.   McCormick                 
  responded negatively.                                                        
                                                                               
  Discussion of the  needs test used  in qualifying a  student                 
  for federal aid followed.                                                    
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 57.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
                                                                               
  AMENDMENT NO. 58                                                             
                                                                               
  Co-chairman   Frank   referenced   a   technical   amendment                 
  (Amendment No.  86) relating to the Alaska  State Council on                 
  the Arts and asked that it be dealt with first.                              
                                                                               
  AMENDMENT NO. 86                                                             
                                                                               
  Co-chairman Frank directed attention to Amendment No. 86 and                 
  advised of subcommittee intent to effect a general reduction                 
  of $57.9 rather than a reduction  of $57.9 in the grant line                 
  for the  Alaska  State Council  on  the Arts.    Co-chairman                 
  Halford  MOVED  for  adoption  of  Amendment  No.  86.    No                 
  objection having been raised, it was ADOPTED.                                
                                                                               
  AMENDMENT NO. 58                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 58.  Co-                 
  chairman Frank OBJECTED.  Senator Zharoff explained that the                 
  amendment would bring Alaska State Council on the Arts grant                 
  line funding up to the  Governor's amended level and  ensure                 
  council ability to match maximum federal funds.  He attested                 
  to  numerous personal opinion  messages from constituents in                 
  support of  the council.   Co-chairman Frank advised  of the                 
  subcommittee  intent  to capture  as  many federal  funds as                 
  possible.  DAVID SKIDMORE, aide  to Senator Frank, explained                 
  that the  department over-estimated  the  amount of  federal                 
  funds  that  would be  available for  FY  96.   Staff worked                 
  closely  with  the  executive  director  of the  council  to                 
  develop the figure of $589.0 in expected federal moneys.  An                 
  equal amount of  general funds  would guarantee the  federal                 
  funding.  That is  the amount contained in the  subcommittee                 
  proposal.  KAREN REHFELD, Director, Administrative Services,                 
  Dept. of Education, came before committee.  She advised that                 
  $589.0 is  the minimum level  of general  funding needed  to                 
  retain the current-year  federal grant.  However,  under the                 
  proposed level  of cuts, the council will need to go back to                 
  the federal  National Endowment  for the  Arts and  reapply.                 
  There is  no  guarantee the  council will  receive the  same                 
  level of federal dollars.                                                    
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No.  58.  The motion  FAILED on a  vote of 2  to 4                 
  (Senator Rieger was temporarily absent from the meeting).                    
                                                                               
  AMENDMENT NO. 59                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 59.                 
  OBJECTION was raised.   Senator  Zharoff explained that  the                 
  amendment would restore funding for close-up, future problem                 
  solving, and  student leadership  programs in  the Dept.  of                 
  Education budget.  It would also restore half of the cuts to                 
  the Alaska  State Museum.   Since funding for  the foregoing                 
  would derive  from the  underground storage  tank fund,  the                 
                                                                               
                                                                               
  amendment  would  not  increase   overall  general  funding.                 
  Close-up has been  zeroed in both House  and Senate budgets.                 
  The other two programs were zeroed  by the Senate but funded                 
  by the House.   Co-chairman  Frank voiced his  understanding                 
  that  moneys  for  the programs  were  grants  to non-profit                 
  groups that coordinate the efforts.   Funding for air travel                 
  is derived from other sources (district moneys and privately                 
  raised funds).  If districts wish to continue  the programs,                 
  they may allocate funding for that purpose.  The Co-chairman                 
  noted  that the  academic  decathlon  has survived  although                 
  funding for the event was removed from the state budget.  If                 
  there is an interest in keeping the  programs, districts and                 
  other groups  will allocate  funds for  continuance.   State                 
  funds, however, will not be provided.                                        
                                                                               
  Senator  Zharoff  asked if  funds could  be moved  among the                 
  three programs.  KAREN REHFELD  again came before committee.                 
  She said that initial  allocations were based on a  level of                 
  funding from several  years ago.   Reductions that  occurred                 
  over the past few years were  evenly spread among the three.                 
  Allocations within the $217.0 are  $70.4 for close-up, $39.8                 
  for  future  problem  solving, and  $107.0  for  the student                 
  leadership program.                                                          
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 59.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 60                                                             
                                                                               
  Co-chairman Frank referenced the  $711,114,140 appropriation                 
  in the  proposed amendment  and advised  that the  committee                 
  would not be including  K-12 educational support in HB  100.                 
  Education will be  funded in separate legislation.   Senator                 
  Zharoff requested a brief recess.                                            
                       RECESS - 7:45 P.M.                                      
                      RECONVENE - 8:25 P.M.                                    
                                                                               
  When the  meeting was  reconvened, Senator  Zharoff directed                 
  attention  to  a  Revised  Amendment No.  60  and  MOVED for                 
  adoption.   Co-chairman Frank  said  he would  not rule  the                 
  amendment out of  order, but he  advised he wished to  avoid                 
  lengthy discussion.   He reiterated that education  would be                 
  funded in separate legislation.   Senator Zharoff  explained                 
  that proposed funding  via the amendment would  maintain the                 
  $61.0  educational  unit,  take  increased  enrollment  into                 
  account, and cover  single and dual-site  schools.  He  then                 
  asked if separate legislation containing educational funding                 
  would  include  those  considerations.    Co-chairman  Frank                 
  acknowledged  that  that  decision had  not  yet  been made.                 
  KAREN REHFELD again came before committee.  She advised that                 
  funding contained in  the amendment is the  amount requested                 
  in the Governor's budget.                                                    
                                                                               
  Senator  Zharoff asked  if educational  funding in  separate                 
                                                                               
                                                                               
  legislation   would   derive   from    the   general   fund,                 
  constitutional  budget reserve,  or  a combination  thereof.                 
  Co-chairman Frank again advised that  that had not yet  been                 
  decided.  Senator  Donley voiced  support for education  and                 
  questioned the  process of funding "small bits and pieces of                 
  the   budget."    Co-chairman  Frank  noted  that  budgetary                 
  requests  and  concerns far  out  number  available funding.                 
  Subcommittee work and committee  hearings seek to  establish                 
  priorities.  Senator Donley remarked that without a spending                 
  plan, it  is difficult  to determine  how funding now  under                 
  review will  fit with  education needs.   Co-chairman  Frank                 
  acknowledged the  concern.   He then  called for  a show  of                 
  hands on adoption of Amendment No. 60 (Revised).  The motion                 
  FAILED on a vote of 2 to 5.                                                  
                                                                               
  AMENDMENT NO. 61                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 61.                 
  Senator  Rieger  OBJECTED.   Senator  Zharoff said  that the                 
  $169,961,700 in funding  for the University of  Alaska would                 
  restore the unallocated reduction.   Co-chairman Frank noted                 
  that  the  amendment  would  bring  general  funds  for  the                 
  University up  to the  Governor's request  and  above FY  95                 
  funding.   Senator Zharoff  advised that  Senate funding  of                 
  $167 million is below  that for FY  95.  The University  has                 
  need for  level funding.   He then  inquired concerning  the                 
  impact of the $2 million reduction.                                          
                                                                               
  MARY  LOU   BURTON,  University   of  Alaska,  came   before                 
  committee.  She concurred  that the amount set forth  in the                 
  amendment reflects the Governor's  request--FY 95 authorized                 
  plus $500.0 for the opening of the natural science building.                 
  A  $2.5  million reduction  will  require the  University to                 
  decrease  services.  The University has long-term employment                 
  contracts  and  commitments  to  students.    It  is not  an                 
  operation that changes quickly.  The University went through                 
  a program assessment  effort, but results  are to be  spread                 
  over a three-year time  frame."  A shorter time  frame means                 
  the University will have to "take  from those places that we                 
  can cut easier."   She cited  instructional labor pools  and                 
  library books as examples and reiterated that it will not be                 
  easy to change programs in a short period of time.                           
                                                                               
  Senator Donley commented on University money wasted on legal                 
  fees due to  illegal personnel practices and  bad collective                 
  bargaining practices by the board of regents.                                
                                                                               
  Further  discussion  followed   regarding  the   unallocated                 
  reduction.  Ms.  Burton advised that  she could not now  say                 
  how  the  reduction  would  be  spread.   Co-chairman  Frank                 
  expressed intent that the decision be left to the University                 
  and  board  of  regents.    Senator Donley  voiced  lack  of                 
  confidence in policy decisions made by the board.                            
                                                                               
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 61.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 62                                                             
                                                                               
  Senator  Zharoff  MOVED  for  adoption  of  intent  language                 
  relating to an  increase of general  funds to the school  of                 
  fisheries   at   the   University   and   inclusion   of   a                 
  communications  position  within  the school.    Co-chairman                 
  Frank OBJECTED, saying that he would prefer to deal with the                 
  issue either on  the floor  of the Senate  or at  conference                 
  committee.  The intent is counter to  the committee approach                 
  in funding an  unallocated reduction which allows  the board                 
  of regents  to make  budgetary decisions.   Senator  Zharoff                 
  advised that he would WITHDRAW the amendment.                                
                                                                               
  AMENDMENT NO. 63                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 63.                 
  Senator Sharp OBJECTED.  Senator  Zharoff explained that the                 
  $415.0 in general funds for  trial courts would provide  for                 
  maintenance and  operation of  the new Anchorage  courthouse                 
  (scheduled to open in January, 1996) for six months.                         
                                                                               
  ART SNOWDEN, Administrative  Director, Alaska Court  System,                 
  came before committee.  He explained that the  funding would                 
  cover  heat,  lights,  and general  maintenance  in  the new                 
  building from January to June, 1996.                                         
                                                                               
  End:      SFC-95, #41, Side 2                                                
  Begin:    SFC-95, #43, Side 1                                                
                                                                               
  Discussion  followed regarding  where cuts  in the  proposed                 
  court  system  budget might  be  made to  cover  expenses of                 
  opening the new building.   Co-chairman Halford advised that                 
  the cap for the  court system did not allow  for increments.                 
  It, in fact, required  decrements to trial courts.   He said                 
  if he were  to add funds back  to the budget, they  would be                 
  for trial courts rather than for  the new building.  Senator                 
  Zharoff  questioned the  advisability  of  allowing the  new                 
  building to sit  vacant for  six months because  of lack  of                 
  funding,  suggesting  that  the  legislature deal  with  the                 
  situation at the present time.                                               
                                                                               
  In response to a question from Senator Phillips, Mr. Snowden                 
  explained  that  the new  building  is on  budget.   Senator                 
  Phillips asked if  funds for the  project could be used  for                 
  operation  and  maintenance   if  it  is  under   budget  at                 
  completion.  Mr. Snowden suggested that could be done if the                 
  legislature  would  allow it.    He noted  that construction                 
  moneys are capital and  could not be used for  operation and                 
  maintenance.                                                                 
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
                                                                               
                                                                               
  Amendment No. 63.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 64                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 64.  Co-                 
  chairman Halford OBJECTED.   Senator Zharoff  explained that                 
  the amendment would provide $67.7  for a labor relations/ADA                 
  coordinator within the administration component of the Court                 
  System budget.   The  position is needed  because of  recent                 
  organization of  approximately 250 court employees  by IBEW.                 
  The position will also handle rapidly increasing demands for                 
  access to court services by persons with  disabilities.  ART                 
  SNOWDEN again  came  before  committee,  stressing  need  to                 
  negotiate with the union in good  faith.  Further, the Court                 
  System is  the most prone  to complaints regarding  the ADA.                 
  The position is funded in the House budget.  Senator Zharoff                 
  noted that the Senate budget of  $5.4 million is below FY 95                 
  funding, lower than that  of the House, and much  lower than                 
  the Governor's request of $6.2 million.                                      
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 64.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  Further discussion followed regarding Court System inability                 
  to  utilize   labor  relations   staff  at   the  Dept.   of                 
  Administration because  of possible claims of  collusion and                 
  unfair labor practices.                                                      
                                                                               
  AMENDMENT NO. 65                                                             
                                                                               
  Senator Zharoff MOVED for adoption of  Amendment No. 65.  He                 
  explained that the $60.4 for the administration component of                 
  the Court  System would  provide for  a computer  trainer in                 
  Anchorage.  He  noted that the  Senate figure is lower  than                 
  both FY 95 funding and the  Governor's request.  ART SNOWDEN                 
  told members  that the  judiciary is becoming  computerized.                 
  While one person  cannot train everyone  in the system,  the                 
  position  could  develop  materials to  assist  in  district                 
  training.                                                                    
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment  No. 65.   The motion FAILED  on a vote  of 1 to 5                 
  (Senator Donley did not appear to vote).                                     
                                                                               
  AMENDMENT NO. 66                                                             
                                                                               
  Senator Zharoff MOVED for adoption of  Amendment No. 66.  He                 
  explained  that addition of  $111.4 in general  funds to the                 
  administration component in  the Court  System budget  would                 
  restore the unallocated  2% reduction.  ART  SNOWDEN advised                 
  that $111.4 was  removed to meet  the cap.  This  particular                 
  component is already underfunded 12%.  The statewide average                 
  is approximately 5.5%.  Trial courts are at 7%.  Co-chairman                 
  Frank voiced his understanding that the underfunding relates                 
                                                                               
                                                                               
  to vacancy.  Mr. Snowden concurred and noted that "Every job                 
  in the court  system, Mr. Chairman, is  automatically frozen                 
  at the beginning  of every fiscal year for  45 days unless I                 
  personally  sign a  waiver."  Very  few waivers  are signed.                 
  The  court system  reviews  its budget  in  January, and  if                 
  expenses are higher  than they should be,  a complete freeze                 
  is put in place.   That slows the filing of  papers in civil                 
  cases.  He explained that the state must move criminal cases                 
  within 120 days.   Budget  reductions have taken  a toll  in                 
  civil cases.                                                                 
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 66.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 67                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 67.  Co-                 
  chairman  Halford  OBJECTED.    He  suggested  that  if  the                 
  committee  seeks to improve the  status of trial courts, the                 
  Alaska Judicial Council would be a  good place from which to                 
  remove funding.  He noted that the council operated for many                 
  years with a budget  of $200.0 to $300.0 and  much volunteer                 
  help.  It does not need the present $500.0 and certainly not                 
  the $667.8 proposed  by the amendment.   Co-chairman Halford                 
  then MOVED to amend the amendment  by reducing the $500.0 to                 
  $300.0  and moving the $200.0 difference  to the trial court                 
  budget.  Senator  Zharoff OBJECTED,  asking what impact  the                 
  amendment to the amendment would  have.  Co-chairman Halford                 
  acknowledged that  the council conducts a substantial number                 
  of research projects for  the judiciary.  He then  recited a                 
  list  of  projects.   The  function  of  the  council is  to                 
  evaluate and recommend candidates  for judges.  That can  be                 
  done  with   substantially  less  money.     Senator  Donley                 
  concurred that the funding  would be better placed  in trial                 
  courts.                                                                      
                                                                               
  Co-chairman Halford next withdrew his motion for adoption of                 
  the amendment to Amendment No. 67 to allow for a vote on the                 
  main motion.                                                                 
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 67.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  Co-chairman  Halford  then  restated  his  MOTION to  reduce                 
  Alaska Judicial Council  funding from  $500.0 to $300.0  and                 
  place  the  $200.0 difference  in  the trial  courts budget.                 
  Senator Zharoff  OBJECTED, voicing concern  regarding impact                 
  on the  council.   Co-chairman Frank  called for  a show  of                 
  hands on adoption  of the amendment.   The verbal  amendment                 
  was  ADOPTED on  a vote of  6 to  1.  [The  foregoing verbal                 
  amendment  was  subsequently  reduced  to  written  form  in                 
  Amendment No. 89.]                                                           
                                                                               
  AMENDMENT NO. 68                                                             
                                                                               
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 68.  Co-                 
  chairman Frank OBJECTED.  Senator Zharoff explained that the                 
  proposed front section provisions would fund monetary  terms                 
  of collective bargaining agreements for  the Dept. of Public                 
  Safety;  Dept.  of  Transportation  and  Public  Facilities;                 
  Office  of  the Governor  for the  Labor, Trades  and Crafts                 
  unit;  Dept.  of Administration  for  the Labor,  Trades and                 
  Crafts  unit; and Office of the Governor for the supervisory                 
  unit.                                                                        
                                                                               
  ANNALEE McCONNELL  voiced strong support for  the collective                 
  bargaining process.  Contracts were negotiated in good faith                 
  by the  prior administration.   She  stressed  need for  the                 
  state to send the message that when contracts are negotiated                 
  in good faith, the state fulfills  the contracts.  She urged                 
  support for the amendment.                                                   
                                                                               
  NANCY SLAGLE noted  that the first section of the amendment,                 
  containing $203.6  for public  safety  employees, funds  the                 
  second year of a contract from last year.  It was  not newly                 
  negotiated.  Funding is included in the House budget.                        
                                                                               
  Senator  Zharoff  inquired  concerning  the  impact  of  not                 
  funding the contracts.  Annalee  McConnell stressed need for                 
  a clear statement from the legislature concerning whether or                 
  not  contracts  will  be supported.    ALISON  ELGEE, Deputy                 
  Commissioner,   Dept.   of   Administration,   came   before                 
  committee.  She explained that failure of the legislature to                 
  fund the contracts, and legislative failure to indicate that                 
  it  is  taking action  not to  fund  them (such  as language                 
  proposed by  the House)  would force  the administration  to                 
  honor  "these  contracts with  the  funds available  to us."                 
  That would result in an additional unallocated reduction.                    
                                                                               
  Co-chairman Halford noted  that the  first paragraph of  the                 
  amendment  ($250,000  for  the Dept.  of  Public  Safety) is                 
  already  in  the House  bill.    Remaining sections  are  in                 
  conflict with sections in the House bill.  Annalee McConnell                 
  acknowledged that the amendment  contains the original front                 
  section  language  proposed by  the  Governor.   Co-chairman                 
  Frank suggested that Amendment No. 68 be HELD pending review                 
  of the front  section of the  budget.  [See 4/20/95  minutes                 
  for subsequent committee action.]                                            
                                                                               
  AMENDMENTS 69, 70, and 71                                                    
                                                                               
  Co-chairman  Frank  noted  that Amendments  69,  70,  and 71                 
  relate to the front  section and asked that they be HELD for                 
  later  consideration.   [See  4/20/95  minutes  for  further                 
  action.]                                                                     
                                                                               
  AMENDMENT NO. 72                                                             
                                                                               
                                                                               
  Co-chairman Frank noted that Amendment No. 72 was previously                 
  adopted.  (See page 19 of these minutes.)                                    
                                                                               
  AMENDMENT NO. 73                                                             
                                                                               
  Senator  Donley  advised  that  funding  set  forth  in  the                 
  amendment  for  the Rural  Alaska Television  Network should                 
  read $819.0 rather than $978.7.  The difference  between the                 
  two reflects  a capital  project that should  appear in  the                 
  capital budget.  Amendment  No. 73 would fill blanks  in the                 
  Senate budget,  in terms of  RATNET funding, with  the House                 
  number.  Previous testimony  before committee indicated that                 
  if the $819.0 was provided as  well as that contained within                 
  the  subcommittee  budget, the  proposal  to  combine Alaska                 
  Public   Broadcasting   and   RATNET   services   could   be                 
  accomplished.     Senator  Donley   MOVED  for  adoption  of                 
  Amendment No. 73.  OBJECTION was raised.   Co-chairman Frank                 
  called for a show of hands.  The motion  FAILED on a vote of                 
  1 to 6.                                                                      
                                                                               
  AMENDMENT NO. 24                                                             
                                                                               
  Co-chairman  Frank  directed  that  committee  consideration                 
  revert  to Amendment  No.  24.   Senator  Zharoff MOVED  for                 
  adoption of an additional $1.1 million  for RATNET.  Senator                 
  Phillips  OBJECTED.   Senator Zharoff  stressed that  RATNET                 
  provides information, news, and emergency messages to remote                 
  areas of the state.                                                          
                                                                               
  MARK  BADGER, Director,  Division  of Information  Services,                 
  Dept.  of Administration,  again  came  before committee  to                 
  reiterate  the   importance  of   "keeping  rural   Alaskans                 
  connected to  the urban  cultures and  vice versa."   RATNET                 
  performs that function.  It is evolving.  It is not a static                 
  system.   It is moving  into a  new information  environment                 
  that  many  Alaskans  have  said  they  want  the  state  to                 
  acknowledge  and  engage.   Not  providing a  line  item for                 
  RATNET represents a step backward.  Mr. Badger stressed need                 
  for funding the transponder, saying  that RATNET bridges the                 
  cultural and geographic barriers of Alaska's people.                         
                                                                               
  Senator Donley advised  that he  would support the  addition                 
  were  a  funding   source  available.    Amendment   No.  24                 
  identifies  no  source other  than  general funds.   Senator                 
  Zharoff  stressed  that  many communities  benefitting  from                 
  RATNET  do  not benefit  from  general fund  expenditure for                 
  numerous other programs for the rest  of the state.  Annalee                 
  McConnell  advised  that  the state  has  an  opportunity to                 
  retain a level of  service throughout the state "so  that we                 
  aren't in a position  of having such an enormous  difference                 
  between  what is  available in  the urban  areas and  what's                 
  available in the rest of the state."  She urged  support for                 
  the amendment which would make  service available at greatly                 
  reduced cost.                                                                
                                                                               
                                                                               
  Senator  Donley  inquired  concerning  need  for   the  $1.1                 
  million,  advising  of his understanding that  RATNET needed                 
  the  House  number combined  with that  of  the Senate.   He                 
  specifically referenced  prior indication that  $819.0 would                 
  be needed.   Mr. Badger explained that  the transition would                 
  cost money.   He subsequently  acknowledged that the  $819.0                 
  would work.   He further noted that  even with either of the                 
  above-noted  numbers, the  Alaska  Broadcast Commission  and                 
  RATNET have  sustained a  22.5% reduction.   The status  quo                 
  will not be maintained.  Even  with a line item addition for                 
  RATNET, the system will be changed and continue to evolve in                 
  a healthy way at a big reduction.                                            
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 24.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  Senator Donley MOVED for funding of  $819.0 for RATNET.  Co-                 
  chairman  Frank  called for  a show  of  hands.   The motion                 
  FAILED on a vote of 2 to 5.                                                  
                                                                               
  AMENDMENT NO. 74                                                             
                                                                               
  Senator  Donley explained  that  additional  funding to  the                 
  Dept. of  Environmental Conservation would  bring the Senate                 
  number for new  federal mandates  on air quality  up to  the                 
  House level.  Funding  would be taken from the  storage tank                 
  assistance  fund.    Co-chairman  Frank  referenced  federal                 
  requirements that additions to the program be fee based.  He                 
  then  voiced  OBJECTION  to the  amendment  since  there are                 
  alternatives which  address the concern.   Co-chairman Frank                 
  called for a  show of hands on adoption of Amendment No. 74.                 
  The motion  FAILED on a vote of 1  to 5 (Senator Zharoff did                 
  not appear to vote).                                                         
                                                                               
  AMENDMENT NO. 75                                                             
                                                                               
  Senator  Donley  advised  that an  additional  $60.0  in the                 
  Commissioner's   Office  of   the  Dept.   of  Environmental                 
  Conservation would offset  problems that  may be created  by                 
  Senate  numbers  for  dealing with  federal  mandates.   The                 
  proposed  addition  is intended  to  provide  flexibility in                 
  addressing the problem.  Co-chairman Frank called for a show                 
  of hands on adoption of Amendment No. 75.  The motion FAILED                 
  on a vote of 2 to 5.                                                         
                                                                               
  AMENDMENT NO. 76                                                             
                                                                               
  Senator Donley explained  that Amendment  No. 76 would  take                 
  $100.0 from  the public defender's  office and add  $50.0 to                 
  the  office  of  public  advocacy   and  $50.0  to  criminal                 
  prosecution.    He referenced  a  handout (copy  appended to                 
  Amendment No. 76, attached to these minutes) and  noted that                 
  it evidences increases in  prosecution expenditures over the                 
                                                                               
                                                                               
  past ten  years.   He further  spoke to  need for  increased                 
  funding for the office of public advocacy, advising of trial                 
  delays because the office does not have sufficient resources                 
  to adequately deal with the number of trials.                                
                                                                               
  End:      SFC-95, #43, Side 1                                                
  Begin:    SFC-95, $43, Side 2                                                
                                                                               
  Discussion  of activities within  the public defender agency                 
  followed.   Senator  Donley  stressed  need to  reprioritize                 
  funding  among the  public  defender, public  advocacy,  and                 
  prosecution and shift resources to areas where they are more                 
  greatly needed.                                                              
                                                                               
  Senator Zharoff inquired regarding the  impact on the public                 
  defender agency.  Annalee McConnell remarked that the agency                 
  is already  under funded.   She acknowledged  that the  most                 
  serious under funding  is in the office of  public advocacy.                 
  Under  funding  relates  to  both  FY  96  and  the  sizable                 
  shortfall from  FY 95.   The  House number  under funds  the                 
  agency by $655.0.   The Senate  figure adds $200.0, but  the                 
  net two-year shortfall remains $450.0.                                       
                                                                               
  Senator  Phillips  voiced support  for  the amendment.   Co-                 
  chairman  Halford   advised  that  he   could  support   the                 
  amendment, but  he cautioned that  as the committee  adds to                 
  prosecution and maintains  reductions on  the civil side  of                 
  the  Dept.  of   Law,  it  should  be  understood  that  the                 
  department will not transfer activities  from the civil side                 
  to the  criminal  side.   Co-chairman  Frank noted  that  no                 
  reductions  were  made in  prosecution.   He  then  asked if                 
  Senator  Donley would  consider  removing funding  from  the                 
  public defender and placing it only in public advocacy.  Co-                 
  chairman Halford concurred  that no reductions were  made in                 
  prosecution, but he  also acknowledged  that prosecution  is                 
  under funded in terms of "what they're able to do."  Senator                 
  Donley referenced figures  indicating that, over a  ten year                 
  period, prosecution received a 4% increase in funding versus                 
  a 47% increase for the public defender.   Further discussion                 
  of increases in all three agencies followed.                                 
                                                                               
  SHARON   BARTON,   Director,   Division  of   Administrative                 
  Services, Dept.  of Administration,  came before  committee.                 
  She concurred  that  the  office  of public  advocacy  is  a                 
  response agency.  The remedy to  increases is not within the                 
  agency but within the system as  a whole.  Annalee McConnell                 
  advised that the  new administration would be  examining the                 
  entire   criminal  justice   system.     Referencing  public                 
  advocacy, specifically, Ms. McConnell further voiced concern                 
  that if the agency is unable to continue to get attorneys on                 
  a voluntary basis, appointments will  be made by the courts.                 
  At that point  the state will  no longer pay  $65 to $70  an                 
  hour  for these services but will have to pay the going rate                 
  which is well over $100 an hour.                                             
                                                                               
                                                                               
  Sharon Barton cautioned against a straight comparison of the                 
  three agencies.  She attested to prosecution  costs that are                 
  not funded in  the prosecution budget and  prosecution costs                 
  funded "straight out of  the public defender budget."   That                 
  makes the public  defender budget look much  larger compared                 
  to prosecution.                                                              
                                                                               
  Discussion followed regarding supplemental  and subcommittee                 
  funding  of prosecution,  the  public  defender, and  public                 
  advocacy.  JERRY BURNETT, aide  to Senator Phillips, advised                 
  of the following:                                                            
                                                                               
       Public Defender               FY   95    authorized   -                 
  $7,792.8                                                                     
                                     w/supp.   and   RPLs    -                 
  $8,200.0                                                                     
                                     Senate                 -                  
  $8,154.7                                                                     
                                                                               
       Public Advocacy               FY   95    authorized   -                 
  $6,614.5                                                                     
                                     w/supp.   and    RPLs   -                 
  $7,279.0                                                                     
                                     Senate                 -                  
  $7,139.6                                                                     
                                                                               
  Ms.  McConnell  stressed that  public advocacy  numbers also                 
  relate to abused  children with great needs.   She described                 
  Alaska's rate  of  child abuse  as "absolutely  outrageous."                 
  Attempts to  reduce funding  to  last year's  number do  not                 
  account for the fact that Alaska  has a growing problem that                 
  must  be  dealt  with.   She  further  attested  to lack  of                 
  flexibility  in  transferring  funds from  one  area  of the                 
  budget  to  another with  greater  need.   Co-chairman Frank                 
  suggested  that   necessary  flexibility  is   provided  via                 
  supplemental funding.  Ms. McConnell advised that she wished                 
  to be on record as saying that the administration has done a                 
  great deal in  working with  the legislature on  cuts.   The                 
  "company line has not  been that we're only asking  for more                 
  money."  The administration  started out with a budget  that                 
  represented the ceiling rather  than the floor.  it  has not                 
  defended "every dollar  of those  budgets."   The focus  has                 
  been on areas of most importance.                                            
                                                                               
  Further  discussion  followed  regarding   the  subcommittee                 
  process and restrictions applied by caps.                                    
                                                                               
  Senator Rieger voiced  support for moving the  entire $100.0                 
  from the public  defender agency  into public advocacy,  and                 
  said he would MOVE for that as an amendment to Amendment No.                 
  76.    Co-chairman  Halford concurred,  noting  the  sizable                 
  shortfall in public  advocacy and the fact  that prosecution                 
  is  funded within  $15.0 of  last  year.   Co-chairman Frank                 
                                                                               
                                                                               
  agreed.  Senator  Zharoff expressed concern over  removal of                 
  funding from the public defender agency since that agency is                 
  most noticeable in rural areas.                                              
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  the amendment to Amendment No. 76.   The motion CARRIED on a                 
  vote of 4 to 3 (Senators  Zharoff, Phillips, and Donley were                 
  opposed).  Co-chairman Frank  called for a show of  hands on                 
  adoption  of  Amendment No.  76,  as  amended.   The  motion                 
  CARRIED on a vote of 5 to 2.                                                 
                                                                               
  AMENDMENT NO. 77                                                             
                                                                               
  Senator  Donley  MOVED   for  adoption   of  the   amendment                 
  appropriating  $500.0  from  the  underground  storage  tank                 
  assistance  fund to the  Dept. of Environmental Conservation                 
  to mitigate  the effect  of federal  mandates regarding  air                 
  quality,  clean water, and  other needs.   He explained that                 
  the  department requested  $1.1 million  in program  receipt                 
  authority.  Co-chairman Frank OBJECTED and called for a show                 
  of hands.  The motion FAILED on a vote of 2 to 5.                            
                                                                               
  AMENDMENT NO. 78                                                             
                                                                               
  Senator Donley  referenced past  attempts to  deal with  the                 
  prison over-population problem by under funding  prosecutors                 
  and  "beefing up the  public defender's budget."   He voiced                 
  disagreement with that approach and spoke in support of need                 
  for Amendment  No. 78, which  would restore $1,696.6  to the                 
  budget for  the  Dept. of  Corrections.   He suggested  that                 
  plans for  an additional  correctional facility  should have                 
  commenced eight years ago.                                                   
                                                                               
  Lengthy discussion followed  between Senator Donley  and Co-                 
  chairman Frank regarding correctional needs and responses to                 
  those needs contained within the Senate budget.  Co-chairman                 
  Frank  stressed  that  the budget  contains  over  $600.0 in                 
  additional funding for institutions, beyond that provided in                 
  the  supplemental.    Further  discussion  of  overcrowding,                 
  vacancy, and out-of-state placement followed.                                
                                                                               
  Senator  Donley  inquired  concerning  the  backlog  of  700                 
  misdemeanants waiting to  serve time and a  subsequent court                 
  order directing the department to provide more timely access                 
  to   jails.     MARGARET   PUGH,   Commissioner,  Dept.   of                 
  Corrections, came  before committee.   She acknowledged that                 
  an Anchorage  court removed department ability  to "schedule                 
  people into  the  institutions."   The court  now does  that                 
  scheduling.  While a backlog is no longer building up, there                 
  is  chronic  overcrowding at  the Sixth Avenue  institution.                 
  That  overflows  to   Hiland  Mountain  and  Palmer.     The                 
  department is constantly shuffling  inmates out to available                 
  CRC  beds.    The  Commissioner  referenced  recent   inmate                 
  population figures and noted a total of 2,593 and a capacity                 
                                                                               
                                                                               
  of 2,665.                                                                    
                                                                               
  Senator Donley questioned how much  deterrent is provided by                 
  the fact that  misdemeanants must wait  one to two years  to                 
  serve time.   Co-chairman Frank concurred in the concern but                 
  noted   that  the  proposed  amendment  would  not  increase                 
  capacity.                                                                    
                                                                               
  End:      SFC-95, #43, Side 2                                                
  Begin:    SFC-95, #45, Side 1                                                
                                                                               
  Annalee  McConnell  acknowledged  that while  the  amendment                 
  would  not  provide  additional  beds,  it would  allow  for                 
  adequate  staff  as   the  inmate   population  once   again                 
  approaches emergency  capacity.  Danger levels increase when                 
  capacity is reached.  There is  usually a drop in population                 
  in the spring.  That has not occurred this year.                             
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 78.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 79                                                             
                                                                               
  Senator  Donley   noted  that  the  proposal   contained  in                 
  Amendment No.  79 is  similar to  that in  Amendment No.  19                 
  (page 12).  He said he would, therefore, not offer Amendment                 
  No. 79.                                                                      
                                                                               
  AMENDMENT NO. 80                                                             
                                                                               
  Senator Donley  explained that when the  mandatory insurance                 
  act was passed, motor vehicle  registration fees were raised                 
  to pay for enforcement.  Over  time, the legislature has not                 
  provided the division of motor vehicles full program receipt                 
  authority.   The department  counters by  threatening to  no                 
  longer  enforce  mandatory   auto  insurance  and  financial                 
  responsibility  laws.  Intent  language within Amendment NO.                 
  80  would  make  clear  that  the  legislature  wants  those                 
  programs continued,  and the  division should  find a  means                 
  within  its  budget  to prioritize  the  programs.   Senator                 
  Rieger  voiced  support for  the  language, advising  of his                 
  intent to support RPL requests  for use of increased program                 
  receipts to assist division of motor vehicle field services.                 
                                                                               
                                                                               
  Co-chairman Frank  voiced a preference  for rewording intent                 
  to  require  the  division to  continue  enforcement  of the                 
  programs within existing levels of  appropriation.  He noted                 
  that   the   intended  fees   were  building   into  revenue                 
  projections.   They  are  not true  program  receipts.   Co-                 
  chairman  Halford  further  questioned intent  that  directs                 
  approval by the Legislative Budget and Audit Committee.  Co-                 
  chairman Frank asked  that Amendment  No. 80 be  temporarily                 
  WITHDRAWN  for  rewording  and  subsequent  presentation  to                 
                                                                               
                                                                               
  committee.                                                                   
  [See page 57  of these minutes  for new language adopted  by                 
  committee.]                                                                  
                                                                               
  AMENDMENT NO. 81                                                             
                                                                               
  Senator  Donley  explained  that  Amendment   No.  81  is  a                 
  duplicate of Amendment No  3 (See page 3 of  these minutes).                 
  Amendment No. 81 was thus WITHDRAWN.                                         
                                                                               
  AMENDMENT NO. 82                                                             
                                                                               
  Senator  Donley  explained that  the  Dept. of  Military and                 
  Veterans  Affairs  has participated  with  the  troopers and                 
  other  law   enforcement  agencies  in  a  drug  eradication                 
  program.     He  noted   he  had   received  concerns   from                 
  constituents regarding the relationship between the military                 
  and law enforcement.  He stressed need for the department to                 
  make operational guidelines  available to  the public.   Co-                 
  chairman  Halford  noted  that most  Dept.  of  Military and                 
  Veterans Affairs  funding is  federal.   He then  questioned                 
  whether intent language could be applied.  Annalee McConnell                 
  concurred that  no general funds  are involved.   Members of                 
  the national  guard are, on  occasion, asked by  the federal                 
  government  or  troopers  to assist  in  "a  bust," but  the                 
  program  is  not  operated  by  the  Dept.  of Military  and                 
  Veterans Affairs.   Senator Donley said that the  moneys are                 
  only expended when  the guard  is acting in  a state  rather                 
  than  federal capacity.   He  noted a  requirement that  the                 
  state  Attorney  General  issue  written  approval   of  the                 
  operation before the funds can be utilized.  Senator  Rieger                 
  acknowledged the U.S. Constitutional prohibition on  federal                 
  military enforcement of domestic state law.                                  
                                                                               
  Co-chairman  Frank  called for  objections  to  the proposed                 
  intent language.   No objection  having been raised,  intent                 
  language within Amendment No. 82 was ADOPTED.                                
                                                                               
  AMENDMENT NO. 83                                                             
                                                                               
  Senator Donley  explained that  intent  language within  the                 
  amendment  requests  that  parks and  recreation  management                 
  within the Dept. of  Natural Resources give a  preference to                 
  residents over non-residents  when adopting  user fees.   It                 
  asks  that  the fee  schedule  charge  higher  fees to  non-                 
  residents at a 4  to 1 ratio.  Senator Donley  then MOVED to                 
  add "least" following the word  "at" so that language reads:                 
  "at least a 4 to 1 ratio."  The Senator noted that different                 
  fees for residents and non-residents is a common practice in                 
  many states.                                                                 
                                                                               
  Discussion  followed  regarding  how  the  department  would                 
  determine whether a user  of park services is a  resident or                 
  non-resident. Senator  Donley noted  that the  department is                 
                                                                               
                                                                               
  already  in  the  process of  making  a  distinction between                 
  residents  and   non-residents.    Intent   language  merely                 
  suggests an appropriate ratio.  Annalee McConnell noted that                 
  some  fees   are  presently  $12.00.    If   the  cost  were                 
  quadrupled, the state would  price itself out of the  market                 
  in terms  of what  is acceptable  to visitors.   Co-chairman                 
  Frank also expressed  concern regarding the proposed  ratio.                 
  While the thrust of the intent is proper, it goes too far in                 
  establishing a specific ratio.                                               
                                                                               
  Senator Donley MOVED  to delete "at a 4 to 1 ratio" from the                 
  intent.  Language would then read:                                           
                                                                               
       It  is  the  intent of  the  legislature  that the                      
       Department of Natural Resources, Division of Parks                      
       and Recreation,  review the  user fees  associated                      
       with Alaska's state parks and adopt a fee schedule                      
       that charges higher fees to non-residents.                              
                                                                               
  Senator Rieger advised that he would be supportive of a 2 or                 
  2.5  to 1  ratio in  order to  give strong direction  to the                 
  division.  Co-chairman Frank remarked on need to maintain  a                 
  relationship between  state fees  and those  of the  private                 
  sector  while  garnering  a  higher  fee  from  out-of-state                 
  visitors.  He  noted that the  department has many fees  for                 
  many purposes and questioned whether a strict ratio would be                 
  appropriate in all instances.                                                
                                                                               
  Co-chairman  Frank  called  for  objections  to  the  intent                 
  language  as  amended.   No  objection  having  been raised,                 
  Amendment No. 83 was ADOPTED, as amended.                                    
                                                                               
  AMENDMENT NO. 84                                                             
                                                                               
  Senator Randy Phillips  explained that  the amendment  would                 
  remove  funding  for  public broadcasting  radio  and public                 
  broadcasting T.V. from the statewide communications services                 
  BRU  in the  Dept. of  Administration budget  and place  the                 
  funding  within a new   BRU  entitled:   Public Broadcasting                 
  Endowment Trust, designated grant, under AS 37.05.316 (named                 
  recipient grant).                                                            
                                                                               
  JOHN  NEWSTROM,  Southeast  Media  Consortium  (a  group  of                 
  Southeast public radio stations) came  before committee.  He                 
  explained that he was  also representing public broadcasters                 
  in  Alaska.   He  voiced support  for  Amendment No.  84 and                 
  provided background  information  on  the  public  broadcast                 
  strategic planning process since 1992.  Part  of that effort                 
  included privatization and support via private funds.                        
                                                                               
  Discussion followed  regarding  membership in  both  of  the                 
  foregoing organizations and the means of appointment as well                 
  as  the  status of  the  current Alaska  Public Broadcasting                 
  Commission appointed  by the Governor.   Co-chairman Halford                 
                                                                               
                                                                               
  questioned the advisability of changing from a known system,                 
  whereby members are  appointed and confirmed, to  an unknown                 
  entity without establishment in law.  He  voiced support for                 
  privatization but expressed reluctance to effect the funding                 
  change until  an alternative  to the  present  system is  in                 
  place.  He cautioned against  abolishing something by taking                 
  away its function without  legislation.  By changing  a line                 
  item in the budget, the committee  would be "doing away with                 
  something that's been there for years."    He suggested that                 
  that is the wrong way to proceed.                                            
                                                                               
  For clarification, Mr. Newstrom directed attention to intent                 
  language within  Amendment  No.  85.    Co-chairman  Halford                 
  concurred  in  the  intent  but  continued to  question  the                 
  timing.  Changes should  be incorporated within  substantive                 
  legislation and debate  be had  thereon.  Co-chairman  Frank                 
  agreed, advising that while he was  not opposed to the idea,                 
  the Finance Committee  is not the  proper forum for a  final                 
  decision on establishment  of the  proposed mechanism.   Co-                 
  chairman Halford  cautioned against providing  a substantial                 
  grant to  a  private entity  before  the entity  is  "really                 
  defined in a way that we know  it's going to stay."  Senator                 
  Sharp voiced concern regarding accountability.                               
                                                                               
  Senator Phillips  MOVED for  adoption of  Amendment No.  84.                 
  Co-chairman Frank called  for a show  of hands.  The  motion                 
  FAILED on a vote of 3 to 4.                                                  
                                                                               
  AMENDMENT NO. 85                                                             
                                                                               
  Senator Phillips moved to WITHDRAW  Amendment No. 85 (intent                 
  regarding the public broadcasting endowment trust), advising                 
  that t might be  offered for consideration at a  later time.                 
  [See page 57.]                                                               
                                                                               
  AMENDMENTS 86, 87, 88, and 89                                                
                                                                               
  Amendments  86 (p. 35),  87 (pp.  22-24), and 89 (Amend. 67,                 
  pp. 40-41)  were  earlier ADOPTED.    Amendment No.  88  was                 
  WITHDRAWN since it was  the same as Amendment No.  46 (pages                 
  26-27).                                                                      
                                                                               
  AMENDMENT NO. 22                                                             
                                                                               
  Senator Zharoff inquired concerning  the status of Amendment                 
  No. 22.  Co-chairman Frank advised  that it was held pending                 
  further  information  from  Senator  Halford.    Co-chairman                 
  Halford  said he would  develop an amendment  to put program                 
  receipts  back  in the  environmental  compliance component.                 
  Co-chairman Frank  asked that consideration of Amendment No.                 
  22 again be HELD.  [See pages 54-55 for subsequent action.]                  
                                                                               
  AMENDMENT NO. 31                                                             
                                                                               
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 31 which                 
  he  explained  would  restore funding  for  the  Division of                 
  Subsistence to  the  FY 95  authorized  level.   The  Senate                 
  budget currently has no funding for the division.                            
                                                                               
  End:      SFC-95, #45, Side 1                                                
  Begin:    SFC-95, #45, Side 2                                                
                                                                               
  If  funding  is not  restored,  the reduction  will solidify                 
  federal management of fish and wildlife resources in Alaska.                 
  Lack of  reliable information could  restrict commercial and                 
  sport use and lead to  conservation problems and litigation.                 
  Senator  Sharp  explained  that   the  subcommittee  deleted                 
  general funds for  the division.  Expenditure  of $1,014,300                 
  in  the  special  project fund  (federal  funds  and program                 
  receipts)   was   approved.      KEVIN   BROOKS,   Director,                 
  Administrative Services, Dept. of Fish and Game, came before                 
  committee.   He explained that all non-general funds for the                 
  BRU are in  the special projects component.  Without general                 
  funds, there will  be no division  to operate the project.                   
  So,  in effect, the  general fund reduction  would result in                 
  forfeiture of federal funds as well.  The division  receives                 
  moneys from federal agencies to perform fish counts, collect                 
  data,  and conduct  various studies.   Subsistence  resource                 
  specialists  are typically  the  "journey" level  job class.                 
  Anthropologists within the wildlife division work on harvest                 
  surveys in remote areas of Alaska.  Co-chairman Frank called                 
  for a show  of hands on adoption  of Amendment No. 31.   The                 
  motion FAILED on a vote of 1 to 5.  (Senator Donley  did not                 
  appear to vote.)                                                             
                                                                               
  AMENDMENT NO. 32                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 32.                 
  Senator Sharp OBJECTED.  Senator  Zharoff explained that the                 
  amendment  would  restore  $711.2 in  general  funds  to the                 
  habitat division.   Proposed cuts in habitat would result in                 
  a 50% reduction in forest practices' staff.                                  
                                                                               
  Comments followed regarding  impact of the  cut in terms  of                 
  implementation  of  the  forest  practices  act,  permitting                 
  offices, oil and gas lease  sale reviews, lack of capability                 
  to provide crucial fish and wildlife data, and participation                 
  in land use initiatives.                                                     
  Discussion   followed   regarding   Title    16   permitting                 
  provisions.  Senator Sharp advised that permitting is funded                 
  at 100% of the FY 95 level.  There is no funding cut.                        
                                                                               
  Annalee McConnell noted  that in  instances of  subsistence,                 
  habitat,  and  commercial  fisheries,  it  is  important  to                 
  maintain a level of operation  to protect existing resources                 
  and ensure  good data  for  the future.   On  behalf of  the                 
  administration,   she   expressed    strong   support    for                 
  subsistence, habitat, and commercial fisheries.  She pointed                 
                                                                               
                                                                               
  to other states as an example of  what has happened in areas                 
  where habitat was not carefully managed.                                     
                                                                               
  Senator Sharp noted  that the $200.0 reduction  was proposed                 
  by the administration for transfer to sport fisheries.                       
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 32.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  AMENDMENT NO. 33                                                             
                                                                               
  Senator Zharoff noted that Amendment No. 87 (pages 22-24) is                 
  similar.   He advised that while  87 does not go far enough,                 
  he would  nevertheless withdraw  Amendment No.  33 with  the                 
  hope that it  might be incorporated  within the budget at  a                 
  later date.                                                                  
                                                                               
  AMENDMENT NO. 34                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 34.                 
  Senator Sharp OBJECTED.  Senator  Zharoff explained that the                 
  amendment would add  $159.3 to the Commissioner's  Office of                 
  the  Dept. of  Fish  and Game  to  restore the  subcommittee                 
  reduction.    The  reduction   would  eliminate  one  deputy                 
  commissioner and the director of external and  international                 
  fisheries.  That would restrict state participation in:                      
            The Boards of Fish and Game                                        
            Migratory Bird Act negotiations                                    
            Pacific Salmon Treaty negotiations                                 
            North Pacific Fishery Management Council                           
                                                                               
  Without the positions, the department  will have a difficult                 
  time defending  Alaska's interest  in critical  national and                 
  international forums.  The addition would restore funding to                 
  the Governor's original  request.   Senator Sharp  explained                 
  that  while the House budget reduces an actual position, the                 
  Senate  took an unallocated  reduction in the Commissioner's                 
  Office.     Subcommittee  funding   also  combined   boards,                 
  administrative  services,  the  Commissioner's  Office,  and                 
  public  communications  within a  $7,144.0  appropriation to                 
  provide flexibility in  making the reduction.   KEVIN BROOKS                 
  again came before  committee.  He  noted that a majority  of                 
  the  funding  within  the   Commissioner's  Office  is   for                 
  positions.  He attested to full board expenditure  of annual                 
  appropriations and noted a $330.0 reduction in the other BRU                 
  included in the new combination.  The total $500.0 reduction                 
  will  have consequences  since  it is  of  a magnitude  that                 
  cannot be entirely absorbed through merger.                                  
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 34.   The motion FAILED  on a vote  of 1 to  5                 
  (Senator Donley did not appear to vote.)                                     
                                                                               
  AMENDMENT NO. 35                                                             
                                                                               
                                                                               
  Senator Zharoff directed  attention to Amendment No.  35 and                 
  advised that  requested funding  for Bering  Sea Fishermen's                 
  Association operations should be $100.4 rather than  $110.4.                 
  He  then  MOVED  for  adoption.    Senator  Sharp  OBJECTED.                 
  Senator  Zharoff explained  that the amendment  would delete                 
  $200.0 for the new harvest incentive program in the Dept. of                 
  Fish and  Game and  would add  $200.0 in  general funds  for                 
  three designated grants  through the Dept. of  Community and                 
  Regional Affairs:                                                            
                                                                               
            North Slope Borough Whale Census        $ 60.0                     
            Yukon River Fisheries Drainage Assoc.   $ 29.6                     
            Bering Sea Fishermen's Assoc.           $100.4                     
                                                                               
  Senator Sharp noted that  the $200.0 reflects fish  and game                 
  fund moneys which cannot be used for the foregoing projects.                 
  Senator  Zharoff  acknowledged  that  the  funds  might   be                 
  restricted.    He then  MOVED to  change  the source  of the                 
  $200.0 to general funds.                                                     
                                                                               
  Speaking to need for the Whale Census, Senator Zharoff noted                 
  that  subsistence  whale  hunts are  allowed  in  ten Alaska                 
  coastal villages.   Census figures  are an important  factor                 
  used by the International Whaling Commission in establishing                 
  subsistence harvest quotas.                                                  
                                                                               
  Senator Sharp declared a conflict of interest, advising that                 
  his son had  flown aircraft used  in census taking over  the                 
  last few years.                                                              
                                                                               
  Senator Zharoff  next spoke to the importance of funding for                 
  the Bering Sea  Fishermen's Association and the  Yukon River                 
  Fisheries   Drainage   Association   and   information   and                 
  assistance  provided  by  both  organizations  in   herring,                 
  salmon, halibut, and bottom fisheries.                                       
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No.  35.  The  motion FAILED on  a vote of 1  to 4                 
  (Senator Donley  did not appear to vote,  and Senator Rieger                 
  was temporarily out of the committee room).                                  
                                                                               
  AMENDMENT NO. 46                                                             
                                                                               
  Senator Zharoff MOVED for adoption of  Amendment No. 46.  He                 
  explained that it would switch the funding source for $555.0                 
  within  the   enforcement  component,   fish  and   wildlife                 
  protection BRU, of the Dept. of  Public Safety from fish and                 
  game  fund  moneys to  general funds.    Fish and  game fund                 
  moneys  are  already  slated for  other  programs.   ANNALEE                 
  McCONNELL  noted  that  Amendment  No.   46  is  similar  to                 
  Amendment No. 88 (withdrawn,  page 50).  She  voiced support                 
  for the change to  general funds, saying that fish  and game                 
  fund  moneys are being used in the commercial fishery (crab)                 
                                                                               
                                                                               
  budget.   Co-chairman  Frank  voiced  concern  regarding  an                 
  overall increase in the budget and  said he was reluctant to                 
  support the amendment.                                                       
                                                                               
  Discussion followed regarding fees and forfeitures  accruing                 
  to  the  fish  and  game   fund  and  budget  proposals  for                 
  expenditure of fund balances for FY 95 and 96.  KEVIN BROOKS                 
  acknowledged that proposed funding would be "a one-time shot                 
  that would deplete the balance" and leave nothing for FY 97.                 
                                                                               
  Co-chairman Frank directed that the  meeting be recessed for                 
  Senate Floor Action.                                                         
                                                                               
                       RECESS - 11:30 P.M.                                     
                     RECONVENE - 12:20 A.M.                                    
                                                                               
  Upon reconvening the meeting, Co-chairman Halford  requested                 
  unanimous  consent for  adoption of  Amendment  No. 46.   No                 
  objection having been raised, Amendment  No. 46 was ADOPTED.                 
                                                                               
                                                                               
  AMENDMENT NO. 91                                                             
                                                                               
  Senator Zharoff presented Amendment No. 91  in jest.  It was                 
  then withdrawn.                                                              
                                                                               
  AMENDMENT NO. 92                                                             
                                                                               
  Co-chairman Frank explained that  the amendment, by  Senator                 
  Zharoff, would  add  $361.0 to  the grants  line for  Alaska                 
  Legal Services  Corporation in  the Dept.  of Community  and                 
  Regional Affairs and  reduce funding for the  Alaska Tourism                 
  Marketing Council within the Dept.  of Commerce and Economic                 
  Development by a  like amount.   Senator  Zharoff MOVED  for                 
  adoption.   Senator Sharp  OBJECTED.   Senator Zharoff  said                 
  that use  of Alaska  Legal Services would  be restricted  to                 
  divorce, custody, adoption, child or spouse abuse, and child                 
  support.  It would not  handle criminal matters, accept fee-                 
  generating cases, or deal with subsistence issues.  He noted                 
  that the corporation provides needed legal services in "more                 
  remote areas of the state."   Co-chairman Frank called for a                 
  show of hands on  adoption of Amendment No. 92.   The motion                 
  FAILED on a vote of 1 to 6.                                                  
                                                                               
  AMENDMENT NO. 93                                                             
                                                                               
  Co-chairman Halford  explained that the amendment  would add                 
  the following program receipts in  two budget components for                 
  the Dept. of Law:                                                            
                                                                               
            Environmental Compliance           $309.7                          
            Exxon Valdez Litigation              50.0                          
                                                                               
  Funding  would remain below last year.  Both components will                 
                                                                               
                                                                               
  generate  additional  program receipts.    Co-chairman Frank                 
  called for  objections.   No objection  having been  raised,                 
  Amendment No. 93 was ADOPTED.                                                
                                                                               
  AMENDMENT NO. 22                                                             
                                                                               
  Co-chairman  Frank   noted  that   additional  funding   for                 
  environmental law  was added  in Amendment  No. 93  (above).                 
  Senator Zharoff MOVED to exclude the $200.0 in general funds                 
  for  environmental  law  from the  proposed  amendment.   No                 
  objection having been raised, the amendment to the amendment                 
  was  ADOPTED.  Senator  Zharoff then  MOVED for  adoption of                 
  Amendment No 22, as amended.   Co-chairman Halford OBJECTED.                 
                                                                               
                                                                               
  BARBARA RITCHIE, Deputy Attorney General, Dept. of Law, came                 
  before committee.   She explained  that the amendment  would                 
  restore  $150.0 for fair business practices.  It would bring                 
  funding for  the  component  up to  that  requested  by  the                 
  Governor and  restore moneys  for  antitrust activities  and                 
  consumer protection.   Addition of $650.0 to  the operations                 
  component would allow the department  to continue efforts in                 
  natural resources,  legislation, and regulations.   Emphasis                 
  would be  on natural  resources in  terms of  fish and  game                 
  allocation, disputes, and litigation.                                        
                                                                               
  Senator  Donley  voiced concern  regarding  rumors that  the                 
  department might attempt  to transfer  additional duties  to                 
  prosecutors to free civil staff.                                             
                                                                               
  End:      SFC-95, #45, Side 2                                                
  Begin:    SFC-95, #47, Side 1                                                
                                                                               
  Mrs. Ritchie advised that such shifting would not occur.                     
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 22.  The motion FAILED on a vote of 2 to 5.                    
                                                                               
  DEPT. OF COMMERCE AND ECONOMIC DEVELOPMENT                                   
                                                                               
  At this  point in  the meeting,  Co-chairman Frank  directed                 
  that the subcommittee recommendation for  the Alaska Seafood                 
  Marketing  Institute  (ASMI)  be presented.    Senator Sharp                 
  MOVED for  total funding of  $14,045.8 as a  working figure.                 
  No objection having been raised, the figure was ADOPTED.                     
                                                                               
  AMENDMENT NO. 39                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 39.                 
  Senator Sharp OBJECTED.  Senator  Zharoff explained that the                 
  amendment would restore  the $200.0  general fund match  for                 
  Alaska Seafood Marketing.  There is  potential that ASMI may                 
  receive an additional $1 million in federal funds  for which                 
  a match would be required.                                                   
                                                                               
                                                                               
  Discussion  followed  regarding  institute  ability  to  use                 
  assessment  funds  as   a  match.     GUY  BELL,   Director,                 
  Administrative  Services,  Dept.  of  Commerce and  Economic                 
  Development,  advised  that  the board  could  allow  use of                 
  assessment revenues as match funding.   The requested $200.0                 
  would match $1  million in anticipated  federal funds.   The                 
  institute will not know until the end of May whether  or not                 
  it will receive the federal moneys.                                          
                                                                               
  Further discussion of subcommittee action and whether or not                 
  the  additional  $200.0  was  needed  as a  match  followed.                 
  Additional   discussion   ensued  regarding   collection  of                 
  assessments.                                                                 
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No.  39.  The motion  FAILED on a  vote of 1  to 5                 
  (Senator Donley was temporarily out of the committee room).                  
                                                                               
  AMENDMENT NO. 40                                                             
                                                                               
  Senator Zharoff MOVED for adoption of Amendment No. 40.  Co-                 
  chairman  Halford OBJECTED.   Senator Zharoff explained that                 
  it  would  restore  $1.2  million  in general  fund  program                 
  receipts  to  the  Alaska  Seafood  Marketing  Institute  to                 
  alleviate need for ASMI to go  to the Legislative Budget and                 
  Audit  Committee  to  expend  assessment  funds.   GUY  BELL                 
  advised that ASMI  has projected what  will be collected  in                 
  assessments over the next year.  Much depends upon the price                 
  of  fish, etc., and  projected numbers  are uncertain.   The                 
  Senate  subcommittee  inserted intent  requesting  that ASMI                 
  come before LBA for additional authority if program receipts                 
  exceed  the  amount appropriated.    ASMI is  concerned that                 
  assessment proceeds not be used for purposes other than ASMI                 
  seafood marketing.   If that were  to occur, there would  be                 
  problems maintaining self-imposed assessments and the salmon                 
  marketing  tax.    Senator  Sharp  said  that  was  not  the                 
  subcommittee  intention.   The  $1.2  million reduction  was                 
  based  on  projections  of  self-assessment  totals.     The                 
  subcommittee  recognizes  that additional  assessment moneys                 
  are, by statute, strictly allocated  to ASMI for promotional                 
  uses.  That would be "basic  and automatic approval by LBA."                 
  There is no  intention of  the money  being used  elsewhere.                 
  Senator Zharoff voiced concern that requests might encounter                 
  problems before Legislative Budget and Audit.  He then asked                 
  if subcommittee intent is clear.   Co-chairman Frank advised                 
  that the intent is clear.                                                    
                                                                               
  Further comments by Mr. Bell followed regarding subcommittee                 
  discussion of  the $1.2 million, $860.0 in disputed tax, and                 
  the  $200.0 in program  receipts associated  with Washington                 
  state staff.   Additional discussion  of the  status of  the                 
  offshore processing tax followed.                                            
                                                                               
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  Amendment No. 40.  The motion FAILED on a vote of 1 to 6.                    
                                                                               
  AMENDMENT NO. 41                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 41.                 
  OBJECTION was raised.   Senator  Zharoff explained that  the                 
  amendment  would restore  $860,0  in  general  fund  program                 
  receipts for  administrative and  legal appeal  of the  off-                 
  shore  processor  tax  on  behalf   of  the  Alaska  Seafood                 
  Marketing Institute.  Co-chairman Frank called for a show of                 
  hands on adoption of Amendment No. 41.  The motion FAILED on                 
  a vote of 1 to 6.                                                            
                                                                               
  AMENDMENT NO. 48                                                             
                                                                               
  Senator  Zharoff  MOVED for  adoption  of Amendment  No. 48,                 
  advising  that  it  would  restore  $182.5 in  general  fund                 
  program  receipts  for  federal program  resale  within  the                 
  occupational safety  and health  component of  the Dept.  of                 
  Labor budget.   ANNALEE McCONNELL added that  state purchase                 
  of government materials for resale to Alaska employers would                 
  save employers 25% and would not cost the state general fund                 
  dollars.    The program  would  be  paid for  strictly  from                 
  program receipts.  NANCY SLAGLE advised that the program has                 
  already received  half-year  funding  from  the  Legislative                 
  Budget  and  Audit Committee.    ARBE WILLIAMS  told members                 
  there is no administrative cost associated with the program.                 
  Program  receipts  will  reimburse   the  initial  cost   of                 
  purchasing materials.                                                        
                                                                               
  Senator Rieger declared a  conflict, advising that he had  a                 
  client  who   performed  a  similar   service--sold  federal                 
  regulations under concession from the federal government--in                 
  the private sector.                                                          
                                                                               
  Co-chairman Frank directed  that Amendment  No. 48 again  be                 
  HELD for later consideration.  [See page 59 of these minutes                 
  for subsequent action.]                                                      
                                                                               
  AMENDMENT NO. 49                                                             
                                                                               
  Senator Phillips advised that  he had no information  on the                 
  amend-ment aside  from the  fact that  the Adjutant  General                 
  feels strongly about  the issue.  Senator  Zharoff suggested                 
  that addition of $30.0 for rural veterans services remains a                 
  policy call  for members.   Co-chairman  Frank called  for a                 
  show of hands on adoption  of Amendment No. 49.   The motion                 
  FAILED on a vote of 1 to 4 (Senator Donley did not appear to                 
  vote,  and  Senator  Rieger  was   temporarily  out  of  the                 
  committee room).                                                             
                                                                               
  AMENDMENT NO. 80                                                             
                                                                               
                                                                               
  Senator  Donley  noted that  he  had earlier  been  asked to                 
  revise language contained within Amendment No. 80.   He then                 
  directed  attention  to  Amendment No.  80,  Revised,  which                 
  reads:                                                                       
                                                                               
       It  is  the  intent of  the  legislature  that the                      
       department  shall  prioritize  and   continue  the                      
       enforcement  of  mandatory   auto  insurance   and                      
       financial responsibility laws.                                          
                                                                               
  He stressed that  the intent is to  continue these functions                 
  within the Dept. of Public Safety.  Co-chairman Frank called                 
  for  objections  to  adoption.    No objection  having  been                 
  raised, Amendment No. 80, Revised, was ADOPTED.                              
                                                                               
  AMENDMENT NO. 85                                                             
                                                                               
  Co-chairman Frank noted that the  amendment had earlier been                 
  withdrawn.  Senator Rieger said he wished to offer a portion                 
  of the intent  language relating to the  Public Broadcasting                 
  Endowment  Trust.   Rather  than  appropriate moneys  to the                 
  trust,  intent would  request that  the  administration work                 
  with the trust  to privatize public broadcasting  in Alaska.                 
  Discussion centering  on wording within the  four paragraphs                 
  of intent followed.  Senator Phillips advised that the first                 
  three  paragraphs  were  included  within  the  subcommittee                 
  report and  previously  adopted  for  inclusion  within  the                 
  budget.   As a result  of further discussion, Senator Rieger                 
  MOVED for adoption  of only the  first sentence of the  last                 
  paragraph:                                                                   
                                                                               
       The  administration should  work  with the  Public                      
       Broadcasting Endowment Trust  to privatize  public                      
       broadcasting in Alaska.                                                 
                                                                               
  Co-chairman  Frank called  for  objections.    No  objection                 
  having been raised, the intent was ADOPTED.  Senator Zharoff                 
  sought  and  was  given   assurance  that  remaining  intent                 
  language could  be added on  the floor  of the Senate  or in                 
  conference committee.                                                        
                                                                               
  AMENDMENT NO. 94                                                             
                                                                               
  Co-chairman  Halford explained that  Amendment No.  94 would                 
  reduce the  Alaska Tourism  Marketing Council  by $300.0  in                 
  general funds.   That brings the  total to the House  level.                 
  The House  has a  further unallocated  reduction in  program                 
  receipts.   Co-chairman Frank  noted  that the  subcommittee                 
  report  for  ATMC had  not  yet been  adopted.   Co-chairman                 
  Halford  withdrew  the  foregoing   amendment.    [See   the                 
  following  discussion  of  the  ATMC  budget for  action  on                 
  Amendment No. 94.]                                                           
                                                                               
  DEPT. OF COMMERCE AND ECONOMIC DEVELOPMENT                                   
                                                                               
                                                                               
  Senator  Sharp MOVED for  adoption of  proposed subcommittee                 
  funding  of  $5,715.3  for   the  Alaska  Tourism  Marketing                 
  Council.   Co-chairman Halford MOVED to amend  the report by                 
  reducing  general  funds  by  $300.0  for  a  new  total  of                 
  $5,415.0.  Senator  Donley voiced  concern that funding  for                 
  the  council  had  not  been  adequately discussed  in  that                 
  council funding was previously  held open for  consideration                 
  by the full committee.                                                       
                                                                               
  End:      SFC-95, #47, Side 1                                                
  Begin:    SFC-95, #47, Side 2                                                
                                                                               
  Co-chairman  Frank  announced  that  discussion  would   now                 
  commence.    Co-chairman  Halford  noted  House  funding  of                 
  $5,492.9.  Senator Phillips indicated he  had a problem with                 
  the $700.0  increase contained  in proposed  Senate funding.                 
  Senator  Rieger  voiced  support for  Co-chairman  Halford's                 
  amendment.   He  noted many  areas within  the  budget where                 
  fees,  program  receipts, and  private  non-state funds  are                 
  providing greater portions  of the  budget.  Tourism  stands                 
  out as the  industry that has not  come to the table  with a                 
  proposal for generation of self-supporting program receipts.                 
                                                                               
                                                                               
  Senator Phillips  MOVED to  amend the  amendment and  reduce                 
  ATMC funding by  $1 million.   He cited  the same  rationale                 
  voiced by Senator Rieger as support for a greater reduction.                 
  ANNALEE  McCONNELL  cautioned  that a  $1  million reduction                 
  would  fund  the council  at $4.7  million.   That  would be                 
  $200.0 less than the FY 95 level.  Senator Sharp attested to                 
  past overstatement of program  receipts by $277.6.  The  net                 
  FY 96 increase was thus $700.0 rather than $1 million.  Mrs.                 
  McConnell  advised  that  the  FY  95 authorized  level  was                 
  $4,992.9.  Senator Phillips withdrew his amendment for  a $1                 
  million reduction and instead  MOVED to fund ATMC at  the FY                 
  95 authorized level.                                                         
                                                                               
  Co-chairman   Frank   clarified   that    the   subcommittee                 
  recommendation   reduced   excess   program    receipts   by                 
  approximately  $200.0.   The number proposed  by Co-chairman                 
  Halford in  the main  motion would  be a  reduction of  $1.3                 
  million  from  the  Governor's request  and  an  increase of                 
  $700.0  from  last year's  funding  less the  excess program                 
  receipts.  It  would thus  result in an  increase of  $400.0                 
  plus.                                                                        
                                                                               
  Co-chairman  Frank  called  for  a  show  of  hands  on  the                 
  amendment to the amendment.   (Senator Phillips's motion for                 
  FY 95 authorized funding of $4,992.9.)  The motion FAILED on                 
  a vote of 1 to 6.                                                            
                                                                               
  Co-chairman Frank called for a show of hands  on Co-chairman                 
  Halford's motion  amending ATMC  funding to  $5,415.0.   The                 
                                                                               
                                                                               
  motion CARRIED on a vote of 4 to 3.  [NOTE - ATMC funding at                 
  $5,415.0 effectively adopted Amendment No. 94.]                              
                                                                               
  AMENDMENT NO. 47                                                             
                                                                               
  Senator Donley MOVED to reconsider the committee decision on                 
  funding for occupational safety and  health within the Dept.                 
  of Labor budget.  He voiced  his understanding that the only                 
  reason funding  was cut was  to meet the  cap.  He  stressed                 
  that the cap  should be a goal  rather than an "end  all, be                 
  all."  Senator Donley noted that additional funding had been                 
  provided for "things that are, frankly, a lot less important                 
  than  the safety  of workers."   Without restoration  of the                 
  $276.4, there will be no enforcement of state safety laws or                 
  flexibility  in  dealing  with   the  House  at   conference                 
  committee.                                                                   
                                                                               
  Senator  Donley  next MOVED  to  add  half,  $138.2, of  the                 
  original request to  the budget  of occupational safety  and                 
  health.  Co-chairman  Frank called  for a show  of hands  on                 
  adoption of Amendment No. 47, as amended.  The motion FAILED                 
  on a vote of 2 to 5.                                                         
                                                                               
  AMENDMENT NO. 88                                                             
                                                                               
  Co-chairman Halford formally MOVED to withdraw Amendment No.                 
  88 since it was similar to  earlier adopted Amendment No. 46                 
  (pages 26-27).                                                               
                                                                               
  AMENDMENT NO. 48                                                             
                                                                               
  Attention reverted to  Amendment No. 48.   Co-chairman Frank                 
  noted  that  the  amendment  would  restore  $182.5  to  the                 
  occupational safety and health component within the Dept. of                 
  Labor budget.   Funding would  continue purchase of  federal                 
  regulations for resale to Alaska employers.  Senator Zharoff                 
  stressed that the impact of the restoration would be zero in                 
  that  the service  generates program  receipts to  reimburse                 
  purchase expenditures.   The  effort is  also supportive  of                 
  state industry.   Co-chairman  Frank  called for  a show  of                 
  hands on adoption of Amendment No. 48.  The motion FAILED on                 
  a vote of 2 to 5.                                                            
                                                                               
  DEPT. OF LABOR                                                               
                                                                               
  Co-chairman    Frank    advised   that    the   subcommittee                 
  recommendation for the  Dept. of Labor budget  was held open                 
  at  a  prior  meeting.   Senator  Randy  Phillips  MOVED for                 
  adoption.  Senator  Donley OBJECTED.   He voiced his  belief                 
  that it would  be a serious  mistake not to provide  funding                 
  for enforcement of state safety laws.  The House also failed                 
  to  provide funding  for  enforcement  of current  statutes.                 
  Senator Zharoff concurred  in Senator Donley's concern.   He                 
  voiced further  concern regarding state liability  should it                 
                                                                               
                                                                               
  fail to protect Alaskan workers.                                             
                                                                               
  Co-chairman Frank called for a show  of hands on adoption of                 
  the subcommittee budget for the Dept.  of Labor.  The motion                 
  CARRIED on a vote of 5 to 2.                                                 
                                                                               
  FRONT SECTIONS                                                               
                                                                               
  MIKE   GREANY,   Director,  Legislative   Finance  Division,                 
  directed attention to  a work draft  SCS for CSHB 100  (Fin)                 
  (9-GH0022\R, Cramer, 4/19/95), containing provisions for the                 
  front  section  of the  budget,  and provided  the following                 
  review:                                                                      
                                                                               
  Sec. 1 sets forth amounts from  the highway fuel tax account                 
  and the aviation fuel tax account, earmarked for the budget.                 
  This is boilerplate language that appears each year.                         
                                                                               
  Sec.  2  contains boilerplate  language  relating to  use of                 
  federal  funds beyond those specifically appropriated in the                 
  budget.  This section was  amended by adoption of  Amendment                 
  No. 10,  which limits appropriations from the  fish and game                 
  fund to stated amounts.                                                      
                                                                               
  Sec. 3 contains boilerplate language appearing in the budget                 
  every year.  It allows for  reduction of state general funds                 
  in instances  where more  federal moneys  are received  than                 
  anticipated, as  long as  the reduction  is consistent  with                 
  federal statutes.                                                            
                                                                               
  Sec. 4 sets forth boilerplate language calling for reduction                 
  of  appropriations  if  federal  funds  fall  short  of  the                 
  estimate.                                                                    
                                                                               
  Sec. 5 contains boilerplate language.  Both House and Senate                 
  budgets cap the amount of the shortfall that can derive from                 
  the  general  fund for  Title  XX (Social  Security  Act) at                 
  $6,310,800.  In response to  a question from Senator Rieger,                 
  Mr. Greany explained that funding relates to  a component in                 
  the Dept. of Health and Social Services budget.                              
                                                                               
  Sec. 6 contains  boilerplate language relating to  the state                 
  insurance  catastrophe  reserve  account  and settlement  of                 
  claims  against bonds guaranteeing  the reclamation of state                 
  land.                                                                        
                                                                               
  Sec. 7 contains boilerplate language  relating to payment of                 
  interest on revenue anticipation notes.                                      
                                                                               
  Sec. 8 contains boilerplate  language relating to  principal                 
  and interest on outstanding state-guaranteed bonds.  Senator                 
  Rieger  asked if  the term  "state-guaranteed bonds"  rather                 
  than "general obligation bonds" was traditionally used.  Mr.                 
  Greany nodded affirmatively.                                                 
                                                                               
                                                                               
  Sec. 9 language  relates to  debt service including  revenue                 
  bonds for airports.                                                          
                                                                               
  Sec.  10 relates  to lease  debt.  Subsection  (b) specifies                 
  lease  payments for Alaska Housing Finance Corporation, City                 
  of Seward, City  of Kenai, the  Dept. of Natural  Resources,                 
  and the Alaska Court System.                                                 
                                                                               
  Sec.  11 relates  to general  obligation debt.    Mr. Greany                 
  noted that  amounts set  forth in  Secs. 10  and 11  reflect                 
  identical Governor, House, and Senate numbers.                               
                                                                               
  Sec. 12 contains traditional language  providing for payment                 
  of dividends from the permanent fund.                                        
                                                                               
  Sec. 13 sets  forth new  language providing $2,703,700  from                 
  the dividend fund to the Dept. of Corrections, per SB 135.                   
                                                                               
  Sec.  14 contains traditional language relating to inflation                 
  proofing of the permanent fund.                                              
                                                                               
  Sec.  15   contains   traditional   language   relating   to                 
  appropriation of interest to the permanent fund.                             
                                                                               
  Sec. 16 appropriates amounts required  to be deposited under                 
  AS 37.12.010(a)(1) and (2) to the principal of the permanent                 
  fund.                                                                        
                                                                               
  Sec. 17 provides for  return of left-over STEP funds  to the                 
  unemployment   compensation   fund   to    satisfy   federal                 
  requirements.                                                                
                                                                               
  Sec. 18 subsections (a) through (e)  are similar to language                 
  in prior years appropriating AHFC  moneys to the corporation                 
  for use per current statutes.  Subsection (d) contains a $70                 
  million transfer  of funds  from AHFC  to the general  fund.                 
  Subsection (e) makes  provisions of (a) through  (c) subject                 
  to Legislative Budget and Audit Committee review through the                 
  revised program process.                                                     
                                                                               
  Sec. 19 appropriates  $9,000,000 in federal receipts  to the                 
  disaster relief fund.  The Senate bill funds disaster relief                 
  entirely  from  federal  moneys.    Mr.  Greany  noted  that                 
  Amendment No. 50 (not yet acted upon by committee (page 30))                 
  contains intent  language relating  to supplemental  funding                 
  for disaster relief.                                                         
                                                                               
  Sec. 20 appropriates  tank registration fees to  the storage                 
  tank assistance fund.                                                        
                                                                               
  Sec. 21 deals with the mitigation  account.  It appropriates                 
  a specific sum of $3,591,300 to the storage  tank assistance                 
  fund.    The balance  will  flow  to the  oil  and hazardous                 
                                                                               
                                                                               
  substance release prevention response fund.                                  
                                                                               
  Sec. 22 deals with the mitigation fund account.                              
                                                                               
  Secs. 23  and 24 appropriate  amounts from the  surcharge to                 
  the oil and hazardous substance release response account and                 
  the oil and hazardous substance  release prevention account.                 
  The  $4,015,100 and  $9,875,700 respectively  set  forth are                 
  identical  to amounts provided in the House budget but lower                 
  than  requested  by the  Governor.    That  is  because  the                 
  surcharge limit was  reached, and the state  will henceforth                 
  only collect the 3-cent portion.                                             
                                                                               
  Sec.  25  contains  a  $21,860,400   appropriation  for  the                 
  information services  fund in  the Dept. of  Administration.                 
  Funding  covers  computer  and  telecommunication  services.                 
  This section will need to be conformed to  individual budget                 
  items   in  agencies.      The  foregoing   number  reflects                 
  subcommittee action and amendments to date.                                  
                                                                               
  Sec. 26 contains a $20,000,000 appropriation for oil and gas                 
  revenue cases to the Dept. of Law.  It differs slightly from                 
  the House budget  in that the  House effected a 75/25  split                 
  between constitutional budget  reserve funding and permanent                 
  fund corporation receipts.  Senate funding reflects Dept. of                 
  Law advice on the current level of activity  between funding                 
  sources and recipients of services.                                          
                                                                               
  Sec. 27 appropriates $80,322,400 for school debt retirement.                 
  That is the amount proposed by  the Governor and included by                 
  the House.                                                                   
                                                                               
  Sec.  28  contains language  that  has appeared  in previous                 
  years.  It  allows for program  receipts for the  Governor's                 
  safety  conference.    In  collecting fees,  the  conference                 
  straddles fiscal years.  Language is included so that moneys                 
  do not lapse.                                                                
                                                                               
  Sec. 29  contains boilerplate language  appropriating moneys                 
  from the real estate surety fund to pay claims awarded under                 
  AS 08.88.470.                                                                
                                                                               
  Sec.  30  allows  program  receipts  for the  Alaska  Public                 
  Utilities Commission to be carried forward  into FY 96.  The                 
  commission will thus not have to charge as much in FY  96 as                 
  it  would have had it not  been allowed to carry forward the                 
  lapse.                                                                       
                                                                               
  Sec.  31  extends  the  lapse  of Alaska  Seafood  Marketing                 
  Institute receipts.                                                          
                                                                               
  Sec.  32  contains  a  $28,006,600  appropriation  from  the                 
  general  fund to the marine highway  system fund to continue                 
  stable services to the  public.  It reflects all  actions to                 
                                                                               
                                                                               
  date   (both   the   subcommittee   report  and   subsequent                 
  amendments).                                                                 
                                                                               
  Sec.  33 provides  funding from the  four dam  pool transfer                 
  fund to  the three  receiving funds.   Mr.  Greany noted  an                 
  issue raised by the recent filing of a lawsuit to use moneys                 
  coming from utilities in the four dam pool to effect repairs                 
  to failing  power lines and other needs.   If that suit were                 
  to prevail,  funds  earmarked for  this  particular  section                 
  would not  be available.   He  further noted  a $20  million                 
  capital budget  request as an  alternative to four  dam pool                 
  use of the revenue flow to effect repairs.                                   
                                                                               
  Sec. 34 contains the single $9,097,800 appropriation for the                 
  Alaska clean water  loan program.   This is the same  amount                 
  requested by the Governor and included  in the House budget.                 
                                                                               
                                                                               
  Sec.  35  contains  annual  language   needed  to  make  the                 
  appropriation for shared taxes.                                              
                                                                               
  Sec. 36 makes  the appropriation for the  salmon enhancement                 
  tax.                                                                         
                                                                               
  Sec. 37 provides $250,000  to satisfy the monetary  terms of                 
  the collective  bargaining agreement  between the  state and                 
  the  Public  Safety  Employees Association.    It  funds the                 
  second year of  an in-effect,  in-force agreement.   Funding                 
  was also provided in the House budget.                                       
                                                                               
  Sec.  38 sets forth language included by the House.  It says                 
  that failure  to provide  a separate  appropriation to  fund                 
  monetary terms nullifies those agreements.                                   
                                                                               
  Sec. 39 addresses  the Constitutional Budget Reserve  sweep.                 
  It provides that  any funds swept into the  CBR at the close                 
  of FY 95 would be restored to the funds from which they were                 
  swept.                                                                       
                                                                               
  Sec. 40 speaks to use of available balances in the statutory                 
  budget reserve to  fund shortfalls in FY  96 appropriations.                 
  The estimated amount that may  be available is approximately                 
  $45 million.   The source of those funds will be moneys from                 
  the  investment loss trust  fund, Executive  Life repayment.                 
  This   provision  was  established  in  FY  90  or  91  when                 
  appropriations were made to the  investment loss trust fund.                 
  The  appropriations specified  that moneys  be prorated  and                 
  returned  back  to the  funds  from which  appropriated (the                 
  general fund and the statutory budget reserve).                              
                                                                               
  Sec. 41 requires that remaining  funds needed to balance the                 
  budget would derive from  the Constitutional Budget Reserve.                 
  The section contains language saying that if a three-fourths                 
  vote is garnered, withdrawal  will be under sec. 17(c).   If                 
                                                                               
                                                                               
  the  three-fourths  vote  is not  achieved,  withdrawal will                 
  occur under sec. 17(b).                                                      
                                                                               
  Sec. 42 sets forth language included in the House version of                 
  the budget.   It relates to  control of expenditures by  the                 
  office of  management and  budget to  minimize need  to draw                 
  upon the Constitutional Budget Reserve.                                      
                                                                               
  Sec. 43 specifies non-lapsing sections.                                      
                                                                               
  Mr. Greany noted  that Amendments 11 (pages  8-9), 12 (pages                 
  9-10), and  17  (pages 11-12)  contain  new sections  to  be                 
  incorporated within the present work  draft of front section                 
  appropriations.                                                              
                                                                               
  Co-chairman Halford  MOVED and  requested unanimous  consent                 
  for adoption of  the "R" draft  as the working document  for                 
  the front section of  SCS CSHB 100 (Fin).   Senator Phillips                 
  advised that  he had a problem with  Sec 41.  Senator Donley                 
  formally OBJECTED, saying that  he did not want there  to be                 
  any question about his opposition to  some of the content of                 
  the budget.                                                                  
                                                                               
  Senator Phillips voiced  his understanding of Sec.  41 to be                 
  that the  state would  take moneys  from the  Constitutional                 
  Budget  Reserve  account  to cover  the  difference  between                 
  expenditures and normal revenues.  Mr. Greany concurred.                     
                                                                               
  Senator Donley advised  that his primary area  of concern is                 
  the  $70  million  appropriation  from  the  Alaska  Housing                 
  Finance Corporation.  He said that the Governor negotiated a                 
  reasonable response through a recurring dividend.  He voiced                 
  further concern  regarding Sec.  38 rejection  of collective                 
  bargaining  agreements   and  Sec   41   funding  from   the                 
  Constitutional Budget Reserve fund.  Mr. Greany advised that                 
  the $70  appropriation from  AHFC was  included in  Governor                 
  Knowles  amended budget.   Annalee McConnell  voiced concern                 
  regarding a proposed amendment that  would change the amount                 
  of the appropriation to $110 million.  The administration is                 
  supportive of the  $70 million appropriation  but not of  an                 
  increase.                                                                    
                                                                               
  Senator  Phillips  MOVED to  remove Sec.  41 from  the bill.                 
  Prior to  action  on Senator  Phillips' motion,  Co-chairman                 
  Frank called for  a show  of hands  on the  main motion  for                 
  adoption of SCS  CSHB 100 (Fin),  version "R," as a  working                 
  document.  The motion CARRIED on a vote of 5 to 2.                           
                                                                               
  Senator Phillips replaced his MOTION to remove Sec. 41  from                 
  the bill.   Co-chairman  Frank OBJECTED.   Senator  Phillips                 
  advised  that  the  Constitutional  Budget  Reserve  has  no                 
  constituency aside from the  Finance Committee.  He  said he                 
  had a problem tapping into a fund established by voters with                 
  a 70% majority.   Annalee McConnell sought  clarification of                 
                                                                               
                                                                               
  Sec.  41  provisions  relating to  the  three-quarter versus                 
  majority vote.    Co-chairman Frank  acknowledged  that  the                 
  Legislative  Finance  Division  had   prepared  calculations                 
  regarding  what  would be  available  under secs.  17(b) and                 
  17(c).   He voiced a  preference for a  three-quarters vote.                 
  Mrs. McConnell concurred, advising that the intention behind                 
  establishment  of  the  fund  was  procurement of  a  three-                 
  quarters vote.  Co-chairman Frank called for a show of hands                 
  on removal  of Sec. 41.  The motion FAILED on a vote of 2 to                 
  4.  (Senators  Donley and Phillips  voted in support of  the                 
  motion.)                                                                     
                                                                               
  End:      SFC-95, #47, Side 2                                                
  Begin:    SFC-95, #49, Side 1                                                
                                                                               
  AMENDMENT NO. 90                                                             
                                                                               
  Senator Rieger directed  attention to  Amendment No. 90  and                 
  explained that it  contains a technical change  to Amendment                 
  No.  11.    It   relates  to  extension  of  the   lapse  or                 
  reappropriation of  grants and  payments of  claims for  the                 
  Violent  Crimes   Compensation  Board  and  the  Council  on                 
  Domestic  Violence  and Sexual  Assault  as well  as amounts                 
  accruing to the  board and  council from day-fine  receipts.                 
  No  objection  having  been  raised,  Amendment No.  90  was                 
  ADOPTED.                                                                     
                                                                               
  CONSTITUTIONAL BUDGET RESERVE                                                
                                                                               
  Senator   Zharoff    asked   that   figures    relating   to                 
  Constitutional Budget Reserves funding  with and without the                 
  three-quarters vote  be made available.   Co-chairman  Frank                 
  directed that the meeting be briefly recessed.                               
                                                                               
                       RECESS - 2:10 A.M.                                      
                      RECONVENE - 2:25 A.M.                                    
                                                                               
  MIKE  GREANY, again  came  before committee  to  speak to  a                 
  handout (copy attached to these minutes) entitled  "Estimate                 
  of  Funds  Available  for  Appropriation  for  FY  96."   He                 
  explained  that  the tabulation  was  designed to  show what                 
  would  be available  under sec.  17(b), if  there were  $100                 
  million left in the earnings reserve  of the permanent fund.                 
  Of the two variables involved in use of the 17(b) provision,                 
  the  biggest is the  disposition of the  earnings reserve of                 
  the permanent fund.  As long as the earnings reserve remains                 
  in  tact  (estimated amount:  $1.1  or $1.2  billion), 17(b)                 
  would  not come  into play.   If something similar  to SB 84                 
  were  to  pass, appropriating  some  portion or  all  of the                 
  earnings  reserve   to  the   corpus,  17(b)  would   become                 
  effective.  The other variable is overall spending.  While a                 
  major portion is contained within  HB 100, education funding                 
  is within a separate  vehicle, and the capital budget  is in                 
  another.   All those appropriations would also play into the                 
                                                                               
                                                                               
  calculation.  Without an appropriation from earnings reserve                 
  to the corpus, the amount  available for appropriation would                 
  far exceed  the difference between last  year's expenditures                 
  and this year's available funds,  and 17(b) provisions would                 
  not be activated.                                                            
                                                                               
  Discussion followed concerning what might  happen should the                 
  Constitutional Budget Reserve be tapped  via a majority vote                 
  and SB  84 fail to  pass the legislature  or fall victim  to                 
  veto.   In  response  to a  further  question  from  Senator                 
  Zharoff,  Mr.  Greany  reiterated  that  should   "something                 
  similar to SB  84" pass  the legislature, be  signed by  the                 
  Governor, and leave a balance  of approximately $100 million                 
  in  the  earnings  reserve of  the  permanent  fund, assumed                 
  expenditure  levels  and  Legislative  Finance  calculations                 
  suggest  that approximately $423  million could  be accessed                 
  from the Constitutional Budget Reserve  by a simple majority                 
  under  subsection  17(b).   Mr.  Greany cautioned  that both                 
  assumptions and calculations are speculative.                                
                                                                               
  Co-chairman Frank directed  attention to proposed amendments                 
  to the front section of the budget.                                          
                                                                               
  AMENDMENT NO. 96                                                             
                                                                               
  Co-chairman Halford MOVED for adoption  of Amendment No. 96.                 
  Senator Zharoff  OBJECTED for  the  purpose of  explanation.                 
  Co-chairman  Halford  advised   that  the  amendment   would                 
  appropriate  $1.6  of  the  $1.9  million  in  the  oil  and                 
  hazardous substance release prevention mitigation account to                 
  the Dept.  of Community and Regional Affairs  for grants for                 
  the  bulk fuel  system  repair  and  upgrade  program.    He                 
  referenced state liability and noted need to work on upgrade                 
  of facilities.  The budget contains $3.5 million for leaking                 
  underground  storage tanks.  This program  is a component of                 
  the same problem.   Senator Phillips asked if  general funds                 
  are  involved.   Co-chairman  Halford  responded negatively,                 
  saying that the  proposed appropriation flows from  the same                 
  funding  source  used  for  the  underground  storage   tank                 
  program.    MIKE GREANY  again  came before  committee.   He                 
  explained  that  while  the moneys  are  counted  as general                 
  funds, rather than appropriation to the response fund, these                 
  moneys would flow  to the bulk fuel program.  The net effect                 
  would be zero.  Co-chairman Halford observed that  while the                 
  program  is  not funded  in the  House  budget, it  has been                 
  funded  in  the  past  and  is  an  ongoing  program.    The                 
  appropriation would not add to the general fund total of the                 
  budget   because   existing   budget  language   (Sec.   21)                 
  appropriates the moneys elsewhere.                                           
                                                                               
  Senator Donley voiced  ongoing concern regarding underground                 
  storage tanks, suggesting that local communities should take                 
  care  of  the   problem.    While  the   proposed  amendment                 
  represents a logical step, it has a downside as well.                        
                                                                               
                                                                               
  Co-chairman Frank called for further questions or objections                 
  to  the  amendment.    No   objection  having  been  raised,                 
  Amendment No. 96 was ADOPTED.                                                
                                                                               
  AMENDMENT NO. 97                                                             
                                                                               
  Co-chairman  Frank   explained  that  the   amendment  would                 
  withdraw  $17,000,000 in unrestricted  cash from  the Alaska                 
  Industrial  Development  and  Export  Authority (AIDEA)  for                 
  transfer to the  general fund. It would  also appropriate $8                 
  million from the group health and  life benefits fund to the                 
  general fund.  NANCY SLAGLE, said that similar language  was                 
  introduced  last  year.    It  was  eventually  changed  and                 
  subsequently vetoed by the Governor.   She acknowledged that                 
  more than $8 million  in the group health and  life benefits                 
  fund   was   identified   as  available   for   use.     The                 
  administration attempted to use that  funding to cover costs                 
  of health  benefits for  employees.   Moneys flowing to  the                 
  fund accrue from  many areas.   They are not simply  general                 
  funds.  The administration has concerns over the proposal to                 
  return  it to  the  general  fund  for purposes  other  than                 
  employee  benefits.    Senator  Donley  concurred   in  that                 
  concern.  He  spoke against an across-the-board  "attack" on                 
  health benefits, noting  that it  would equally impact  both                 
  low and high paid employees.  Ms. Slagle said she could make                 
  no recommendations on what is and  is not available from the                 
  fund.                                                                        
                                                                               
  Speaking to the  proposed $17  million transfer from  AIDEA,                 
  ANNALEE McCONNELL noted that AIDEA is  a source of funds for                 
  "a  whole  host of  economic  development projects"  many of                 
  which  are   being  put   together  at   this  time.     The                 
  administration would not support use of AIDEA funds.                         
                                                                               
  Senator  Donley remarked  that  Amendment  No.  97  contains                 
  "really big  issues"  that  should not  be  brought  on  for                 
  discussion  at  3:00   a.m.  when  the  public   has  little                 
  opportunity for input.                                                       
                                                                               
  Co-chairman Frank suggested that the question of adoption of                 
  the  two  proposals  within  Amendment  No. 97  be  divided.                 
  Referencing the  $17 million  appropriation from AIDEA,  the                 
  Co-chairman noted that the legislature had  withdrawn moneys                 
  from the authority  in previous years.   Should it later  be                 
  determined that the funding is not available, the conference                 
  committee  could   "back  away  from   this  appropriation."                 
  Senator Rieger MOVED to divide the question.                                 
                                                                               
  Co-chairman Frank  called for  a show  of hands  on the  $17                 
  million transfer from AIDEA.  The  proposal was ADOPTED on a                 
  vote of 5 to 2.                                                              
                                                                               
  At  the request  of Co-chairman  Frank, Co-chairman  Halford                 
                                                                               
                                                                               
  MOVED to withdraw the proposed $8 million appropriation from                 
  the  group health  and  life benefits  fund.   No  objection                 
  having been raised, IT WAS SO ORDERED.                                       
                                                                               
  Co-chairman  Frank  directed  that the  meeting  be  briefly                 
  recessed.                                                                    
                                                                               
                       RECESS - 2:55 A.M.                                      
                      RECONVENE - 3:05 A.M.                                    
                                                                               
  Upon reconvening  the meeting,  Co-chairman Frank  announced                 
  that  the  meeting  would  be  recessed  at  this  time  and                 
  reconvened at approximately 11:00 a.m.                                       
                                                                               
  RECESS                                                                       
                                                                               
  The meeting was recessed at approximately 3:10 a.m.                          
                                                                               

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