Legislature(1999 - 2000)

04/01/1999 08:07 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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SENATE BILL NO. 33                                                                                                              
"An Act relating to the Task Force on Privatization;                                                                            
and providing for an effective date."                                                                                           
                                                                                                                                
                                                                                                                                
This was the fifth hearing for this bill in the Senate                                                                          
Finance Committee. Co-Chair John Torgerson noted that the                                                                       
Committee had adopted a committee substitute, Version "N"                                                                       
as a Workdraft in an earlier hearing but there was a new                                                                        
proposed committee substitute before members for                                                                                
consideration.                                                                                                                  
                                                                                                                                
Co-Chair John Torgerson reminded the Committee that the                                                                         
first committee substitute amended the language relating to                                                                     
items not subject to bargaining and the unrestricted                                                                            
authority of the employer to enter into contracts with the                                                                      
private sector to perform certain public functions. He also                                                                     
noted that two amendments proposed by Senator Loren Leman                                                                       
were adopted. Senator Loren Leman detailed the changes made                                                                     
by the amendments, saying one amendment inserted "or to                                                                         
perform more efficiently" after each provision relating to                                                                      
debt consolidation. The other amendment, he noted, allows                                                                       
the commissioner to appoint an unpaid advisory council.                                                                         
                                                                                                                                
Co-Chair John Torgerson pointed out that the proposed                                                                           
committee substitute incorporates those amendments.                                                                             
                                                                                                                                
Senator Sean Parnell moved for adoption as a Workdraft, CS                                                                      
SB 33, 1-LS0317/S, 3/25/99. The committee substitute was                                                                        
adopted without objection.                                                                                                      
                                                                                                                                
MARK HODGINS, staff to the bill sponsor, Senator Jerry Ward                                                                     
testified. He noted that the legislation had evolved from                                                                       
establishing a task force to a commission, but reassured                                                                        
the Committee that the committee substitute is compatible                                                                       
with the sponsor's intent for privatization of services and                                                                     
savings for the State.  He stated that several individuals                                                                      
wished to testify on this legislation but have been unable                                                                      
due to the rescheduling of hearings. Therefore, he                                                                              
presented written testimony from some of those people. He                                                                       
referred to a letter supporting the bill from The Alliance                                                                      
dated March 18, 1999 and a resolution in support of the                                                                         
bill from the Alaska State Chamber of Commerce adopted                                                                          
December 4, 1998. (Copies on file)                                                                                              
                                                                                                                                
                                                                                                                                
Tape: SFC - 99 #78, Side B                                                                                                      
                                                                                                                                
                                                                                                                                
JUANITA HENSLEY, Department of Administration, testified to                                                                     
the section of the committee substitute that amends the                                                                         
Public Employee Relations Act (PERA).  She stated that the                                                                      
Administration has concerns with the PERA changes and                                                                           
believed that at this time, making changes of this                                                                              
magnitude affects the ability to enter into negotiations in                                                                     
the remaining term contract.                                                                                                    
                                                                                                                                
She stressed the Administration's first priority in                                                                             
negotiation of contracts is cost containment and attempting                                                                     
to reach a zero cost contract. Changing PERA in the middle                                                                      
of the contract negotiations, she warned, could jeopardize                                                                      
the cost objectives.                                                                                                            
                                                                                                                                
She added that the current contract with the state                                                                              
employees does not prohibit the State from outsourcing                                                                          
services if cost effectiveness for the State can be shown.                                                                      
She used the Division of Motor Vehicles as an example of                                                                        
the State entering a partnership with the private sector to                                                                     
enhance services to the public.                                                                                                 
                                                                                                                                
Senator Lyda Green referred to the practice of outsourcing                                                                      
Division of Motor Vehicle services saying that the division                                                                     
could not expand privately administered services into the                                                                       
Mat-Su area was because of an inadequate cost savings as                                                                        
required under current statute.                                                                                                 
                                                                                                                                
Juanita Hensley responded that the division outsources                                                                          
services when it can be shown to be cost effective. She                                                                         
listed Tok, Talkeetna and Glennallen as communities where                                                                       
the private sector is providing the services and the                                                                            
division has been able to eliminate the government                                                                              
positions.                                                                                                                      
                                                                                                                                
Senator Gary Wilken supported the legislation but was                                                                           
concerned that it contains an item that caused a similar                                                                        
bill to be vetoed the previous year. Co-Chair John                                                                              
Torgerson explained that the item in question is a                                                                              
provision allowing the governor to appoint a member to the                                                                      
commission. Senator Gary Wilken referred to the governor's                                                                      
veto message raising concerns about the separation of                                                                           
powers. Senator Gary Wilken hoped this bill would not be                                                                        
vetoed for the same reason and stressed that the Committee                                                                      
needs to recognize that possibility and perhaps address the                                                                     
issue.                                                                                                                          
                                                                                                                                
Co-Chair John Torgerson commented that the previous                                                                             
legislation gave subpoena power to the commission, which                                                                        
caused concern for the governor. He assured that provision                                                                      
is not in the current bill. He added that if the governor                                                                       
chooses to not participate in the process by vetoing this                                                                       
bill, it sends a strong message that the governor is not                                                                        
interested in working toward consolidation or                                                                                   
privatization.                                                                                                                  
                                                                                                                                
Senator Loren Leman offered a motion to report from                                                                             
Committee, CSSB 33 (FIN) and without objection it was                                                                           
reported out with an indeterminate fiscal note from the                                                                         
Office of the Governor.                                                                                                         
                                                                                                                                
                                                                                                                                
Co-Chair John Torgerson noted the Committee would stand in                                                                      
recess and come back to order if someone arrived wishing to                                                                     
testify on the long-range budget situation.                                                                                     
                                                                                                                                
AT EASE 9:20AM/10:22AM                                                                                                          
                                                                                                                                
Co-Chair Sean Parnell noted there was no one present to                                                                         
testify.                                                                                                                        
                                                                                                                                
ADJOURNED                                                                                                                       
                                                                                                                                
Co-Chair Sean Parnell adjourned the meeting at 10:22 AM.                                                                        
SFC-99 (16) 4/1/99                                                                                                              

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