Legislature(2019 - 2020)SENATE FINANCE 532

04/25/2019 09:00 AM FINANCE

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Audio Topic
09:11:18 AM Start
09:12:41 AM Fiscal Plan Review: Legislative Finance Division
01:33:30 PM SB32
03:18:27 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ David Teal, Legislative Finance Director TELECONFERENCED
+ Bills Previously Heard/Scheduled: TELECONFERENCED
+= SB 32 CRIMES; SENTENCING;MENT. ILLNESS;EVIDENCE TELECONFERENCED
Heard & Held
-- Testimony <Invitation Only> --
+= SB 35 CRIMES;SEX CRIMES;SENTENCING; PAROLE TELECONFERENCED
<Bill Hearing Canceled>
                 SENATE FINANCE COMMITTEE                                                                                       
                      April 25, 2019                                                                                            
                         9:11 a.m.                                                                                              
                                                                                                                                
                                                                                                                                
9:11:18 AM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair  Stedman   called  the  Senate   Finance  Committee                                                                    
meeting to order at 9:11 a.m.                                                                                                   
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Natasha von Imhof, Co-Chair                                                                                             
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Click Bishop                                                                                                            
Senator Lyman Hoffman                                                                                                           
Senator Peter Micciche                                                                                                          
Senator Donny Olson                                                                                                             
Senator Bill Wielechowski                                                                                                       
Senator David Wilson                                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Mike Shower                                                                                                             
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
David Teal,  Director, Legislative Finance  Division; Alexei                                                                    
Painter,   Analyst,  Legislative   Finance  Division;   John                                                                    
Skidmore,  Director, Criminal  Division, Department  of Law;                                                                    
Michael Duxbury,  Deputy Commissioner, Department  of Public                                                                    
Safety; Kelly  Howell, Director, Division  of Administrative                                                                    
Services,   Department  of   Public  Safety;   Sylvan  Robb,                                                                    
Administrative    Services     Director,    Department    of                                                                    
Corrections, Office  of Management and Budget;  Nancy Meade,                                                                    
General   Counsel,  Alaska   Court  System;   Senator  Cathy                                                                    
Giessel; Senator Mia Costello.                                                                                                  
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
FISCAL PLAN REVIEW: LEGISLATIVE FINANCE DIVISION                                                                                
                                                                                                                                
SB 32     CRIMES; SENTENCING;MENT. ILLNESS;EVIDENCE                                                                             
                                                                                                                                
          SB 32 was HEARD and HELD in committee for further                                                                     
          consideration.                                                                                                        
                                                                                                                                
^FISCAL PLAN REVIEW: LEGISLATIVE FINANCE DIVISION                                                                             
                                                                                                                                
9:12:41 AM                                                                                                                    
                                                                                                                                
DAVID   TEAL,   DIRECTOR,  LEGISLATIVE   FINANCE   DIVISION,                                                                    
discussed  the  presentation  titled, "Fiscal  Plan  Review"                                                                    
(copy on  file). He  remarked that  the committee  had asked                                                                    
several questions  and requested  a number of  scenarios. He                                                                    
noted  that   Mr.  Painter  would  address   some  of  those                                                                    
questions. He  began reviewing  some comments  and questions                                                                    
from the  presentation the prior  Tuesday. He  remarked that                                                                    
there was a  focus of four issues:  the presentation format,                                                                    
the  expenditure  growth  rates,  revenue  options,  and  an                                                                    
Permanent  Fund Dividend  (PFD) priority.  He would  address                                                                    
each of those issues separately.                                                                                                
                                                                                                                                
Mr. Teal addressed slide 2,  "Where does Governor Dunleavy's                                                                    
plan lead?", related to presentation  issues. He stated that                                                                    
the  first three  slides  were generated  by  the Office  of                                                                    
Management and Budget  (OMB), although it may  not have been                                                                    
clear to everyone, and he  stressed that the slides were now                                                                    
labeled as prepared by OMB.                                                                                                     
                                                                                                                                
Mr.  Teal looked  at slide  3, "Scenario  1: The  Governor's                                                                    
Plan." He  noted that the  governor's plan could  be closely                                                                    
reproduced in the Legislative  Finance Division (LFD) model.                                                                    
He  stated that  the plan  showed deficits  as high  as $450                                                                    
million during the following six  years, which was under the                                                                    
assumption that  the oil and  gas property tax  was retained                                                                    
by the state. He remarked  that there was another slide that                                                                    
showed  what  happens  should  that   property  tax  not  be                                                                    
retained by  the state, which  would add  approximately $400                                                                    
million per year  to the deficit under  the governor's plan.                                                                    
He stressed  that, without  that revenue,  the plan  was not                                                                    
sustainable.                                                                                                                    
                                                                                                                                
Mr.  Teal highlighted  slide 4,  "Status Quo  Budgeting." He                                                                    
stated that  he referred to  this scenario as  the "doomsday                                                                    
scenario."  He  stated that  there  was  not an  attempt  to                                                                    
duplicate the  scenario in the  LFD model. He  stressed that                                                                    
they did not  understand what made PFD go away  in FY 22. He                                                                    
remarked  that there  was not  an attempt  to reproduce  the                                                                    
underlying assumptions. He remarked  that the primary reason                                                                    
for "treating  it so lightly"  was because the  scenario did                                                                    
not reflect neither  the House nor the Senate  plan. He felt                                                                    
that  there  was  no  proposal   that  was  similar  to  the                                                                    
scenario, so he felt it  was not relevant to the discussion,                                                                    
except  in  its implication  that  a  budget that  does  not                                                                    
incorporate  the governor's  cuts  would not  be viable.  He                                                                    
stated  that the  issue was  addressed the  previous Tuesday                                                                    
showing  House and  Senate scenarios  that were  sustainable                                                                    
and affordable.                                                                                                                 
                                                                                                                                
9:16:40 AM                                                                                                                    
                                                                                                                                
Mr.  Teal  addressed  slide 5,  "The  Governor's  Plan."  He                                                                    
remarked that  there was a  request to simplify  the graphs.                                                                    
He  shared that  LFD  could not  create  something that  was                                                                    
helpful, so  the charts  were not  simplified for  the day's                                                                    
meeting.  Rather,  the  focus  was on  a  model  that  would                                                                    
generate  the  desired the  scenarios.  He  stated that  the                                                                    
concern  with  simplification  was   that  there  were  many                                                                    
various factors.                                                                                                                
                                                                                                                                
Mr.  Teal looked  at slide  15,  "Real Unrestricted  General                                                                    
Fund   Revenue/Budget    History."   He    announced   that,                                                                    
historically, flat  budget was not unrealistic.  He remarked                                                                    
that  the  slide  showed  the budget  and  revenue  in  real                                                                    
dollars, which meant that they  were adjusted for inflation.                                                                    
He stressed that there was  a 20-year period when the budget                                                                    
declined in real  dollars, which meant that it  did not keep                                                                    
pace with  inflation. The inflation rate  during that twenty                                                                    
years  averaged approximately  2.5  percent.  The growth  of                                                                    
expenditures in that  time averaged  a little  less than 1.5                                                                    
percent. He  explained that, compared to  the projections of                                                                    
constrained future  revenue and fairly low  inflation, a 1.5                                                                    
percent growth  under a 2.5  percent inflation  scenario was                                                                    
not historically  unrealistic. He remarked that  there was a                                                                    
time when state  employees did not receive  raises over five                                                                    
years, so many employees left for higher paying jobs.                                                                           
                                                                                                                                
9:25:48 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman  stressed that the  request to LFD  did not                                                                    
steer  the   legislature.  He  wanted   to  move   onto  the                                                                    
scenarios,  and encouraged  the  public  to understand  that                                                                    
there was an attempt to make decisions.                                                                                         
                                                                                                                                
Mr. Teal addressed slide 16.  He stated that the spreadsheet                                                                    
showed  the  revenue  projections and  various  options  for                                                                    
expenditures.  He  stated that  the  current  budget had  an                                                                    
expenditure  of  approximately  $4.3 billion.  He  furthered                                                                    
that  adding  the capital  budget,  which  was an  arbitrary                                                                    
number in transfers that resulted  in total spending showing                                                                    
a surplus of  $750 million. He stressed that  it would allow                                                                    
a  PFD  payment of  $1171  apiece.  He  stated that  it  was                                                                    
assuming that  a budget surplus  went to the  dividends, and                                                                    
then additional PFDs required for  the budget to be balanced                                                                    
with cuts, new revenue, or reserves.                                                                                            
                                                                                                                                
9:30:19 AM                                                                                                                    
                                                                                                                                
Mr. Teal discussed slide 17,  "Projected Reserve Balances --                                                                    
End of FY19." He stated  that there was roughly $2.3 billion                                                                    
in the  Constitutional Budget Reserve (CBR);  $19 billion in                                                                    
the Permanent  Fund Earnings Reserve (ERA);  $170 million in                                                                    
the  Statutory Budget  Reserve; $340  million in  the Higher                                                                    
Education Investment Fund; and $1  billion in the Power Cost                                                                    
Equalization (PCE) Fund.                                                                                                        
                                                                                                                                
Co-Chair  Stedman  invited  Mr.  Painter to  the  table.  He                                                                    
remarked  that the  CBR was  the main  savings account,  and                                                                    
required  a  three-quarter  vote from  the  legislature  for                                                                    
access. He wondered whether the  $2.3 billion was the Spring                                                                    
Forecast number or a more  current expectation of oil prices                                                                    
through the end of June.                                                                                                        
                                                                                                                                
Mr. Teal replied that it was the Spring Forecast number.                                                                        
                                                                                                                                
Co-Chair  Stedman recalled  the year  prior's $1600  PFD. He                                                                    
recalled that  there was  an expected  draw of  $600 million                                                                    
from  the  CBR the  year  prior.  He requested  the  current                                                                    
year's expected CBR draw.                                                                                                       
                                                                                                                                
Mr. Teal  replied that  at the end  of the  previous session                                                                    
showed that the previous  anticipated draw was approximately                                                                    
$700  million,  and the  Spring  Forecast  showed a  reduced                                                                    
number of closer  to $300 million. The  anticipated draw was                                                                    
now closer to $100 million.                                                                                                     
                                                                                                                                
9:34:18 AM                                                                                                                    
                                                                                                                                
ALEXEI  PAINTER,  ANALYST,   LEGISLATIVE  FINANCE  DIVISION,                                                                    
discussed,  "Index   of  Model  Outputs  -   Senate  Finance                                                                    
4/25/19" (copy on file). HE  remarked that the committee had                                                                    
made a  number of  requests that  could have  overlapped and                                                                    
produced  many different  iterations. He  stated that  seven                                                                    
base scenarios  were graphed,  and there  was a  summary for                                                                    
some  of  the permutations  therein  to  see the  impact  of                                                                    
different tweaks  within each scenario. He  stressed that he                                                                    
was willing  to meet privately  to discuss each  scenario in                                                                    
depth.                                                                                                                          
                                                                                                                                
9:35:16 AM                                                                                                                    
                                                                                                                                
Co-Chair   Stedman   noted    that   LFD   was   continually                                                                    
accommodating presenting different  options to the committee                                                                    
members.                                                                                                                        
                                                                                                                                
Mr. Painter looked  at page 2, "1. Senate  Budget with $250m                                                                    
capital budget,  1.5 percent  budget growth,  75/25 dividend                                                                    
split." He remarked that this  scenario represented a higher                                                                    
Capital Budget.  He noted that  the graph showed  a scenario                                                                    
depicting  2 percent  budget growth.  He qualified  that the                                                                    
slide                                                                                                                           
                                                                                                                                
Senator Wielechowski asked about  the difference between 1.5                                                                    
percent and 2.25 percent budget growth.                                                                                         
                                                                                                                                
Mr.  Painter   highlighted  page  3,  "Plan   Comparisons  -                                                                    
Scenarios with  $250 million  capital budget."  He addressed                                                                    
Senator  Wielechowski's question  and noted  that the  third                                                                    
column , and pointed out the CBR balance.                                                                                       
                                                                                                                                
Senator Wielechowski  asked about  an estimate for  a yearly                                                                    
basis of 1.5 percent and 2.5 percent inflation.                                                                                 
                                                                                                                                
Mr.  Painter  noted  that  the  amount  was  compounded  and                                                                    
estimated, so he  did not have that  information. He guessed                                                                    
that  it would  be  approximately $50  million  a year,  but                                                                    
compounding.                                                                                                                    
                                                                                                                                
Co-Chair  Stedman  asked  Mr.   Painter  to  give  his  best                                                                    
estimate for  answers and follow  up with greater  detail if                                                                    
requested.                                                                                                                      
                                                                                                                                
Senator Micciche noted that the  estimate was based on an 8-                                                                    
year  span. He  remarked that  there was  a $150  million to                                                                    
state at  far below regular  interest. He wondered  how long                                                                    
that would be sustainable.                                                                                                      
                                                                                                                                
Mr. Painter continued to address slide 3.                                                                                       
                                                                                                                                
9:40:48 AM                                                                                                                    
                                                                                                                                
Co-Chair von  Imhof considered the four  columns and thought                                                                    
it  was  shown that  with  a  higher  inflation rate  and  a                                                                    
dividend floor of 25 percent;  inflation ate more from state                                                                    
services  each year  while the  dividend was  held harmless.                                                                    
She thought  the scenario would require  more reductions and                                                                    
would be particularly difficult with healthcare expenses.                                                                       
                                                                                                                                
Mr. Painter  addressed page  4, "2.  Senate Budget  with OMB                                                                    
capital budget,  2.25 percent budget growth,  75/25 dividend                                                                    
split." The slide  was based on a request,  and isolated the                                                                    
2.25 percent budget growth.                                                                                                     
                                                                                                                                
Mr. Painter looked at page  5, "Plan Comparisons - Scenarios                                                                    
with  2.25 percent  budget growth."  He remarked  that there                                                                    
was a scenario that showed  using the surplus for dividends,                                                                    
and  the third  showed a  50/50 dividend  split. The  result                                                                    
from that  scenario resulted in  the CBR running out  by the                                                                    
end of the period.                                                                                                              
                                                                                                                                
Senator  Hoffman considered  that  slides 4,  6,  and 8  all                                                                    
showed  two and  one quarter  for the  growth rate.  He felt                                                                    
that Mr.  Teal made a  strong argument for the  1.5 percent.                                                                    
he understood  Co-Chair von Imhof's concerns  about Medicaid                                                                    
and other growth factors that  were out of the legislature's                                                                    
control.  He recommended  the rate  of 1.5  percent to  make                                                                    
better comparisons.                                                                                                             
                                                                                                                                
Mr. Painter stated  that the purpose of slide 4  was to show                                                                    
the higher inflation rate.                                                                                                      
                                                                                                                                
Senator  Hoffman  reiterated  that  his request  for  a  1.5                                                                    
percent rate.                                                                                                                   
                                                                                                                                
9:45:27 AM                                                                                                                    
                                                                                                                                
Senator  Wielechowski  asked to  be  reminded  what the  OMB                                                                    
capital budget looked like on a per year basis.                                                                                 
                                                                                                                                
Mr. Painter replied that the  OMB capital budget was roughly                                                                    
$100 million per year of unrestricted general funds.                                                                            
                                                                                                                                
Mr. Painter  discussed page  6, "3.  Senate Budget  with OMB                                                                    
capital  budget, 2.25  percent  budget  growth, $1,600  then                                                                    
50/50  dividend." He  stated that  he had  the request  from                                                                    
Senator Hoffman.  He noted  that the  slide showed  the 2.25                                                                    
percent growth  rate. He  noted that  once the  dividend was                                                                    
increased, the CBR would run out in the scenario.                                                                               
                                                                                                                                
Mr. Painter displayed page 7,  "Plan Comparisons - Scenarios                                                                    
with $1,600 then 50/50 dividend."   He stated that the slide                                                                    
showed the numbers with a  lower inflation rate. He remarked                                                                    
that  the unplanned  draws  would be  less  with that  lower                                                                    
budget growth rate.                                                                                                             
                                                                                                                                
Mr.  Painter  addressed  a  worksheet  of  graphs  that  was                                                                    
requested  by Senator  Hoffman and  addressed  (copy not  on                                                                    
file),  which  showed the  scenario,  but  with 1.5  percent                                                                    
inflation scenario.                                                                                                             
                                                                                                                                
Senator Hoffman explained that he  requested the scenario so                                                                    
that people could see that  the $1600 dividend would give at                                                                    
least four years to contemplate the gap.                                                                                        
                                                                                                                                
Co-Chair  Stedman   remarked  that  Senator  Olson   has  an                                                                    
additional scenario.                                                                                                            
                                                                                                                                
9:50:46 AM                                                                                                                    
                                                                                                                                
Co-Chair von Imhof stressed that  the "$1.6 billion deficit"                                                                    
was  contrived, and  felt  that  the state  did  not have  a                                                                    
fiscal  crisis. She  stated that  with both  the Senate  and                                                                    
House  plans,  there  was   approximately  $700  million  in                                                                    
surplus. She  stressed that the problem  was determining the                                                                    
priority.                                                                                                                       
                                                                                                                                
Senator Wielechowski noted that  the percent of market value                                                                    
(POMV)  draw was  5.25 percent  in  2020, and  reduced to  5                                                                    
percent in 2028; although there  was an effective percentage                                                                    
of 4.44 and 4.84 percent. He asked for an explanation.                                                                          
                                                                                                                                
Mr. Painter replied that the  effective percentage was lower                                                                    
than  the  stated  percentage,   because  of  the  five-year                                                                    
average in  the delay. The  FY 20 POMV  draw was based  on a                                                                    
five-year  average of  fiscal years  ending in  FY 18.  As a                                                                    
result  the actual  percentage of  that  year's balance  was                                                                    
lower  than   the  stated  draw,  assuming   that  the  fund                                                                    
continued to grow.                                                                                                              
                                                                                                                                
Co-Chair Stedman  announced that  it would  change depending                                                                    
on an advancing or declining market.                                                                                            
                                                                                                                                
Senator Micciche stressed that  it assumed the Callan growth                                                                    
assumption of 6.55 growth rate.                                                                                                 
                                                                                                                                
Mr. Painter agreed.                                                                                                             
                                                                                                                                
Co-Chair Stedman  remarked that it was  the projected growth                                                                    
rate by the consultants of the Permanent Fund.                                                                                  
                                                                                                                                
Mr. Painter  addressed page  8, "4.  Senate Budget  with OMB                                                                    
capital  budget, 2.25  percent  budget  growth, $1,600  then                                                                    
75/25 dividend."  He remarked that the  scenario showed that                                                                    
the CBR  would shrink, but  still existed through  the whole                                                                    
scenario.                                                                                                                       
                                                                                                                                
Mr. Painter looked at page  9, "Plan Comparisons - Scenarios                                                                    
with $1,600 then  75/25 dividend." He remarked  that the CBR                                                                    
was  still intact,  but was  reduced  to approximately  $400                                                                    
million. He  remarked that, with  the $250 million  and 2.25                                                                    
percent  growth there  would be  no CBR  by the  end of  the                                                                    
period.  He  also  remarked  that  there  may  not  be  some                                                                    
unplanned  draws from  the ERA,  but  with more  constrained                                                                    
budgets  there would  be more  of a  CBR at  the end  of the                                                                    
period in the scenario.                                                                                                         
                                                                                                                                
9:55:26 AM                                                                                                                    
                                                                                                                                
Mr. Painter highlighted page 10,  "5. Senate Budget with OMB                                                                    
capital budget, 1.5 percent  budget growth, 60/40 dividend."                                                                    
He remarked that there would  be significant deficits in the                                                                    
scenarios, of  approximately $400  million to  $600 million.                                                                    
He  remarked  that  the  CBR  would  be  eliminated  in  the                                                                    
scenario. He  did not do  multiple permutations,  but agreed                                                                    
to provide that information.                                                                                                    
                                                                                                                                
Co-Chair  Stedman surmised  that it  seemed that  there were                                                                    
many $300  million to  $400 million  deficits. He  felt that                                                                    
there  was  a  convergence  of  those  numbers.  He  queried                                                                    
impressions at running all the scenarios.                                                                                       
                                                                                                                                
Mr. Painter  replied that if  one had a  statutory dividend,                                                                    
the full $3000 would  result in higher deficits particularly                                                                    
with  higher budget  growth. He  stressed  that the  highest                                                                    
growth rate was with inflation.                                                                                                 
                                                                                                                                
Mr. Painter  addressed page 11,  "6. Senate Budget  with OMB                                                                    
capital  budget,   1.5  percent  budget   growth,  stairstep                                                                    
dividend  (25 percent  to 33  percent  to 40  percent to  50                                                                    
percent)."  He  stated  that the  scenario  showed  multiple                                                                    
steps up of dividends.                                                                                                          
                                                                                                                                
                                                                                                                                
Mr. Painter looked at page  12, "7. Senate Budget with $250m                                                                    
capital budget, 2.25 percent  budget growth, 50/50 dividend,                                                                    
repeal  of per-barrel  credit."  He remarked  that it  would                                                                    
show the impact of repealing the per barrel credit.                                                                             
                                                                                                                                
Co-Chair Stedman  queried the number  used for  the marginal                                                                    
revenue change.                                                                                                                 
                                                                                                                                
Mr. Painter replied that the  value of the credit during the                                                                    
period  ranged from  just over  $1 billion  to approximately                                                                    
41.2 billion  higher in  some of the  first years,  and then                                                                    
reducing slightly.                                                                                                              
                                                                                                                                
Co-Chair  Stedman  surmised  that  removed  the  per  barrel                                                                    
credit.                                                                                                                         
                                                                                                                                
Mr.  Painter agreed,  and stated  that it  assumed no  other                                                                    
changes in the tax law or company behavior.                                                                                     
                                                                                                                                
10:00:14 AM                                                                                                                   
                                                                                                                                
Senator Bishop asked  for an explanation of  the deficits in                                                                    
FY 22 to FY 26 on the slide.                                                                                                    
                                                                                                                                
Mr.  Painter replied  that repealing  the per  barrel credit                                                                    
had a  larger revenue  impact in the  first two  years, then                                                                    
declining,  then   increasing  again.  He  stated   that  it                                                                    
resulted in surpluses and then  deficits, which was based on                                                                    
the 50/50 split.                                                                                                                
                                                                                                                                
Co-Chair   Stedman  noted   that  regardless   of  politics,                                                                    
changing one component impacted other components.                                                                               
                                                                                                                                
Mr. Painter noted the slide in  the packet that was added to                                                                    
the presentation  title, "8. Senate Budget  with OMB Capital                                                                    
Budget, 1.5  percent growth  statutory dividend."  He stated                                                                    
that  the statutory  calculation  was roughly  $3000 in  the                                                                    
current year,  growing, and then shrinking  again. He stated                                                                    
that  the scenario  showed  deficits  of approximately  $1.2                                                                    
billion in the  first year, and increasing  to $1.7 billion,                                                                    
and then  decreasing again  toward the  end of  the forecast                                                                    
period. He noted that the CBR  would run out near the end of                                                                    
FY 22.                                                                                                                          
                                                                                                                                
Co-Chair  Stedman felt  that  it was  important  to see  the                                                                    
impact of a $300 PFD.                                                                                                           
                                                                                                                                
Co-Chair Stedman  noted that there  was a reflection  of the                                                                    
urgency related to changes.                                                                                                     
                                                                                                                                
10:05:24 AM                                                                                                                   
                                                                                                                                
Senator Micciche  felt that it  was an easy problem  to fix.                                                                    
He stressed  that the problem  extremely complex  that would                                                                    
result in a painful decision.                                                                                                   
                                                                                                                                
Co-Chair  von  Imhof  stressed that  the  public  felt  many                                                                    
different things.                                                                                                               
                                                                                                                                
Senator Hoffman  stated that the statutory  dividend was way                                                                    
to  high to  consider further.  He stressed  that the  split                                                                    
must be resolved in the  long-term, otherwise there would be                                                                    
a political issue in all of the elections.                                                                                      
                                                                                                                                
Senator  Wielechowski remarked  that  there  were many  laws                                                                    
that the public  felt might be irrational, and  that was the                                                                    
reason for  the legislature. He shared  that the legislature                                                                    
decided on a  dividend, and felt that the  formula should be                                                                    
followed. He agreed  that the issue was so  important to the                                                                    
public, and felt that it should  be decided by a vote of the                                                                    
people.                                                                                                                         
                                                                                                                                
Senator Bishop  remarked that there must  be a comprehensive                                                                    
"road  show" to  show the  potential implications  of future                                                                    
Alaskans.                                                                                                                       
                                                                                                                                
Co-Chair  Stedman felt  that  there needed  to  be a  "split                                                                    
bill." He noted  that there was a committee  bill that would                                                                    
take the percentage of market value (POMV) draw.                                                                                
                                                                                                                                
Senator Olson stated that he was  the one that asked for the                                                                    
step  down split  scenario. He  noted that  he was  still in                                                                    
favor of a full PFD.                                                                                                            
                                                                                                                                
Co-Chair Stedman  thanked the  committee and  the presenters                                                                    
for their time and consideration of the different models.                                                                       
                                                                                                                                
10:16:58 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:17:01 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  Stedman announced  that the  meeting would  recess                                                                    
until 1:30pm.                                                                                                                   
                                                                                                                                
10:17:26 AM                                                                                                                   
RECESSED                                                                                                                        
                                                                                                                                
1:32:59 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 32                                                                                                            
                                                                                                                                
     "An  Act  relating  to   criminal  law  and  procedure;                                                                    
     relating   to   controlled  substances;   relating   to                                                                    
     probation; relating to  sentencing; relating to reports                                                                    
     of  involuntary  commitment;  amending Rule  6,  Alaska                                                                    
     Rules  of  Criminal  Procedure; and  providing  for  an                                                                    
     effective date."                                                                                                           
                                                                                                                                
1:33:30 PM                                                                                                                    
                                                                                                                                
Co-Chair von Imhof  emphasized that one of  the Senate's top                                                                    
priorities  was  to  address   crime.  Her  intent  was  for                                                                    
committee members to fully understand the bill and identify                                                                     
                                                                                                                                
1:35:12 PM                                                                                                                    
                                                                                                                                
JOHN  SKIDMORE, DIRECTOR,  CRIMINAL DIVISION,  DEPARTMENT OF                                                                    
LAW,  wanted to  know  the details  that  he should  provide                                                                    
within the fiscal note.                                                                                                         
                                                                                                                                
Co-Chair  von   Imhof  stated  that   she  would   like  the                                                                    
highlights of the fiscal note.                                                                                                  
                                                                                                                                
Mr.  Skidmore   addressed  a  new   fiscal  note   from  the                                                                    
Department of Law, OMB Component 2202.                                                                                          
                                                                                                                                
Senator Bishop asked if Mr.  Skidmore was confident that six                                                                    
prosecutors would be sufficient.                                                                                                
                                                                                                                                
Mr.  Skidmore replied  that the  fiscal note  indicated what                                                                    
would be initially appropriate.                                                                                                 
                                                                                                                                
Senator Bishop stated that to  get his support for the bill,                                                                    
he did not want to use the cheap route.                                                                                         
                                                                                                                                
1:40:03 PM                                                                                                                    
                                                                                                                                
Co-Chair  von Imhof  noted  that the  last  sentence on  the                                                                    
second page  which showed that additional  support staff may                                                                    
be appropriate.                                                                                                                 
                                                                                                                                
Mr. Skidmore affirmed that statement.                                                                                           
                                                                                                                                
1:40:31 PM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman thought  it  would be  nice  to have  more                                                                    
clarity in  referencing the document related  to each fiscal                                                                    
note.                                                                                                                           
                                                                                                                                
Co-Chair von Imhof agreed.                                                                                                      
                                                                                                                                
Mr. Skidmore referenced the document  heading for the fiscal                                                                    
note OMB Component 2202.                                                                                                        
                                                                                                                                
Co-Chair Stedman recalled  that before the passage  of SB 91                                                                    
(which was  passed to lower  costs), and wondered  where the                                                                    
state  would be  as related  to the  timelines of  the crime                                                                    
bills.                                                                                                                          
                                                                                                                                
Co-Chair von  Imhof thought Co-Chair  Stedman was  asking if                                                                    
the department  had lost  staff and if  the fiscal  note was                                                                    
bringing the department back to status quo.                                                                                     
                                                                                                                                
Mr. Skidmore  stated that  the request  would not  bring the                                                                    
department back  to the previous  levels in 2015.  He stated                                                                    
that it would bring the number close to it.                                                                                     
                                                                                                                                
Senator Hoffman  thought the CS  addressed recriminalization                                                                    
of driving with cancelled  licenses. He wondered whether any                                                                    
of the dollars would be administered in rural Alaska.                                                                           
                                                                                                                                
Mr. Skidmore answered in the affirmative.                                                                                       
                                                                                                                                
Senator Wilson was trying to  find the average case load per                                                                    
prosecutor for misdemeanors.                                                                                                    
                                                                                                                                
Mr. Skidmore did not have a definitive number.                                                                                  
                                                                                                                                
1:45:58 PM                                                                                                                    
                                                                                                                                
Senator Wilson asked if Mr.  Skidmore expected the appellate                                                                    
court to have an increase in cases.                                                                                             
                                                                                                                                
Mr. Skidmore answered in the affirmative.                                                                                       
                                                                                                                                
Senator Wielechowski addressed  Co-Chair Stedman's question,                                                                    
and asked if  the department would be able  to prosecute all                                                                    
misdemeanors and felonies.                                                                                                      
                                                                                                                                
Mr. Skidmore  stated that the  department believed  that the                                                                    
numbers reflected in the fiscal note.                                                                                           
                                                                                                                                
1:48:17 PM                                                                                                                    
                                                                                                                                
Co-Chair von  Imhof commented that  the it was  difficult to                                                                    
pair  with  numbers from  the  past  because the  state  had                                                                    
federal  funds   for  drug  offenses.  She   referenced  the                                                                    
designation of being  a high-intensity drug-trafficking area                                                                    
(HIDTA).  She  stressed that  it  all  interplayed with  the                                                                    
number of crimes and criminals.                                                                                                 
                                                                                                                                
Mr. Skidmore agreed with Co-Chair von Imhof's comments.                                                                         
                                                                                                                                
Co-Chair von  Imhof summarized that  the fiscal  note showed                                                                    
approximately  $1.48  million  annually for  the  next  four                                                                    
years, with thirteen positions.                                                                                                 
                                                                                                                                
1:50:12 PM                                                                                                                    
                                                                                                                                
Senator  Wielechowski appreciated  an early  conversation he                                                                    
had  with  Mr.  Skidmore.  He asked  about  a  provision  in                                                                    
Section 41 of the bill. He  proposed an amendment to say the                                                                    
court  could suspend  the license  of someone  that was  not                                                                    
making  a good  faith  effort  to pay.  He  wondered if  the                                                                    
amendment could be supported by the administration.                                                                             
                                                                                                                                
Mr. Skidmore  relayed that he  had not considered  the full.                                                                    
He was not  comfortable taking a position on  that without a                                                                    
full understanding.                                                                                                             
                                                                                                                                
Co-Chair von Imhof requested a hard copy of the amendment.                                                                      
                                                                                                                                
Senator Wielechowski  addressed Section 24 of  the bill that                                                                    
pertained  to terroristic  threats. He  thought the  section                                                                    
was  reasonable,  however  there  was  some  incongruity  in                                                                    
Section 24, lines 25 through  29. He stated that it appeared                                                                    
that if  a person,  for example, threatened  to blow  up the                                                                    
pipeline, that  person had  broken the  law. He  stated that                                                                    
threatening to shoot  someone in the head did  not break the                                                                    
law. He wondered whether that was incongruous.                                                                                  
                                                                                                                                
Mr.  Skidmore  recalled that  he  had  discussed a  scenario                                                                    
related  to  a phone  call  that  threatened a  person,  and                                                                    
stated that it would not  satisfy an eminence for an assault                                                                    
in the third degree.                                                                                                            
                                                                                                                                
Mr. Skidmore  was not sure  he agreed that the  language was                                                                    
inconsistent.                                                                                                                   
                                                                                                                                
Senator Wielechowski  pondered if  it should  be a  crime to                                                                    
call a person and threaten to shoot the person.                                                                                 
                                                                                                                                
Mr. Skidmore noted that the  conduct might be too broad. The                                                                    
language in the current bill could be changed if needed.                                                                        
                                                                                                                                
1:55:52 PM                                                                                                                    
                                                                                                                                
Senator  Wielechowski  addressed  Section 26  of  the  bill,                                                                    
which   dealt  with   criminal   possession  of   controlled                                                                    
substances.  He  was concerned  about  making  a felony  for                                                                    
simple  possession, which  would  follow  an individual  far                                                                    
into the  future and affect many  areas of life. He  was not                                                                    
sure it  was the  right policy call.  He thought  the matter                                                                    
was worthy of debate.                                                                                                           
                                                                                                                                
Co-Chair  von Imhof  agreed  that the  matter  was a  policy                                                                    
call, and thought the matter came  to the heart of the issue                                                                    
of crime.                                                                                                                       
                                                                                                                                
Senator Micciche stated  he had supported SB  91. He thought                                                                    
the members  had not been  aware of its eventual  impact. He                                                                    
had  spent  time  learning  about  suspended  judgement.  He                                                                    
thought  it was  a  matter of  simple  market economics.  He                                                                    
strongly supported suspended entry  of judgement. He thought                                                                    
without a  deterrent, there  was a  low probability  of drug                                                                    
users making a life change.                                                                                                     
                                                                                                                                
2:00:31 PM                                                                                                                    
                                                                                                                                
MICHAEL DUXBURY,  DEPUTY COMMISSIONER, DEPARTMENT  OF PUBLIC                                                                    
SAFETY,  used an  analogy to  illustrate the  differences in                                                                    
Schedule 1A and Schedule 2A drugs.                                                                                              
                                                                                                                                
Mr.  Duxbury   discussed  the   presentation,  "Representing                                                                    
Dosages of  Opioids," (copy  on file).   He showed  slide 2,                                                                    
"1/10 gram  = 1 dose."  The slide  showed a penny.  He noted                                                                    
that 1/10 gram was a dose  to maintain an addiction. He made                                                                    
note of the small size of the substance.                                                                                        
                                                                                                                                
Mr.  Duxbury  advanced to  slide  3,  "Heroin Doses,"  which                                                                    
showed various  pictures. He drew  attention to red  box. He                                                                    
emphasized  that  it  took  very little  heroin  to  make  a                                                                    
person.                                                                                                                         
                                                                                                                                
2:05:30 PM                                                                                                                    
                                                                                                                                
Mr.  Duxbury displayed  slide 4,  "Heroin Doses,"  which was                                                                    
the same as the previous  slide but with a box encapsulating                                                                    
one gram of  heroin. He noted that if there  was fentanyl in                                                                    
the heroin, there was propensity for harm in overdose.                                                                          
                                                                                                                                
Mr.  Duxbury  referenced  slide  5,  "Heroin  Doses,"  which                                                                    
showed the same photograph with  a box. He drew attention to                                                                    
the smaller  amounts of the  drug. He discussed the  cost of                                                                    
heroin in remote areas of the state.                                                                                            
                                                                                                                                
Mr. Duxbury spoke to slide 6, "Lethal Dose of Fentanyl":                                                                        
                                                                                                                                
     Fentanyl is 100 times more powerful than heroin                                                                            
     This represents a lethal dose of fentanyl                                                                                  
                                                                                                                                
2:09:08 PM                                                                                                                    
                                                                                                                                
Co-Chair  von Imhof  asked  how a  person  made or  acquired                                                                    
fentanyl.                                                                                                                       
                                                                                                                                
Mr. Duxbury  stated that fentanyl  was coming to  the United                                                                    
States  from China,  and often  came through  the mail.  The                                                                    
drug had begun coming from Mexico, as well as Canada.                                                                           
                                                                                                                                
Co-Chair von  Imhof thanked Mr. Duxbury  for the information                                                                    
in his presentation.                                                                                                            
                                                                                                                                
Senator Micciche asked  to go back to slide 3,  and asked to                                                                    
hear an explanation on the "user-dealer" and large dealer.                                                                      
                                                                                                                                
Mr. Duxbury stated  that a person that was  addicted and was                                                                    
living  on the  street  or barely  functional  would take  a                                                                    
number of doses and sell the rest in order to get money.                                                                        
                                                                                                                                
Senator Micciche asked how larger dealers were protected.                                                                       
                                                                                                                                
Mr. Duxbury wanted to  juxtapose Senator Micciche's question                                                                    
with another  idea. He  felt that a  small amount  of heroin                                                                    
could still  be considered  of doing  great harm.  He stated                                                                    
that if  a person  was capable was  selling a  small amount,                                                                    
could sell a large amount.                                                                                                      
                                                                                                                                
2:15:49 PM                                                                                                                    
                                                                                                                                
Senator  Wielechowski agreed  with Mr.  Duxbury in  the case                                                                    
that fentanyl  did not have  reasonable use. He  thought the                                                                    
bill   criminalized  (in   the   fourth  degree)   morphine,                                                                    
oxycodone.  He  wondered  if  he  was  reading  the  statute                                                                    
correctly.                                                                                                                      
                                                                                                                                
Mr.  Duxbury thought  the law  and system  did not  have the                                                                    
resources to take a person with one pill.                                                                                       
                                                                                                                                
Senator   Wielechowski   wondered   why  one   should   give                                                                    
prosecutors  the  ability to  prosecute,  when  there is  an                                                                    
assumption that they would never pursue prosecution.                                                                            
                                                                                                                                
Mr.  Duxbury reiterated  that he  was not  saying the  crime                                                                    
would not be  charged, rather he was  referencing the effort                                                                    
put into it. He stressed  that there were many counterfeited                                                                    
pills, sometimes made out of fentanyl to mimic other drugs.                                                                     
                                                                                                                                
2:20:07 PM                                                                                                                    
                                                                                                                                
KELLY   HOWELL,   DIRECTOR,   DIVISION   OF   ADMINISTRATIVE                                                                    
SERVICES, DEPARTMENT  OF PUBLIC SAFETY, addressed  FN 1 from                                                                    
the  Department of  Public Safety,  OMB component  3200. She                                                                    
detailed that the note was a zero fiscal note.                                                                                  
                                                                                                                                
Senator  Micciche asked  if the  zero fiscal  note reflected                                                                    
that  the  department  was  not able  to  intervene  in  the                                                                    
increase in crime.                                                                                                              
                                                                                                                                
Ms.  Howell asked  if Senator  Micciche was  referencing the                                                                    
fiscal  note related  to the  transmission of  mental health                                                                    
records from the Court System.                                                                                                  
                                                                                                                                
Senator  Micciche  stated  that   he  did  not  see  another                                                                    
Department  of Public  Safety (DPS)  fiscal note  associated                                                                    
with the bill.                                                                                                                  
                                                                                                                                
Ms.  Howell relayed  that the  department  had not  included                                                                    
additional fiscal notes related  to the additional work that                                                                    
may or may not be related to the bill.                                                                                          
                                                                                                                                
2:25:20 PM                                                                                                                    
                                                                                                                                
Co-Chair von  Imhof asked if  DPS could receive  records, or                                                                    
whether DPS was asking for records.                                                                                             
                                                                                                                                
Ms. Howell  stated that  the department  was asking  for the                                                                    
records to be transmitted.                                                                                                      
                                                                                                                                
Co-Chair  von Imhof  stated that  the  committee would  hear                                                                    
more about the issue.                                                                                                           
                                                                                                                                
Senator  Hoffman   noted  that   Western  Alaska   had  many                                                                    
challenges;  it  was  a  vast  area  and  his  district  was                                                                    
extremely  large.  He  stated  that  the  drug  problem  was                                                                    
growing,  but  alcohol  abuse  was   still  the  number  one                                                                    
problem. He  wondered whether the  Launch program  was still                                                                    
intact.                                                                                                                         
                                                                                                                                
Mr. Duxbury answered in the affirmative.                                                                                        
                                                                                                                                
Senator Hoffman asked  for the successes of  the program and                                                                    
a program description.                                                                                                          
                                                                                                                                
Mr.  Duxbury  stated  that  there was  an  issue  with  drug                                                                    
enforcement work in  every village. He used an  analogy of a                                                                    
shotgun  shell  as related  to  the  drug issue  in  Western                                                                    
Alaska. He stated that there was  work in hubs, and move out                                                                    
when there  is a  need to  chase down  a problem.  There was                                                                    
usually a  focus on the  transportation conduit  like rivers                                                                    
and snow machines.                                                                                                              
                                                                                                                                
2:30:15 PM                                                                                                                    
                                                                                                                                
Mr.   Duxbury  continued   to   address  Senator   Hoffman's                                                                    
question.  He  showed  slide  4,  and  discussed  successful                                                                    
seizure of alcohol  and drugs at the airport  destined for a                                                                    
community.                                                                                                                      
                                                                                                                                
Senator  Hoffman  asked with  the  passage  of SB  32,  what                                                                    
impacts on crime were anticipated.                                                                                              
                                                                                                                                
Mr. Duxbury  replied that  focusing on  one gram  might help                                                                    
him to save lives.                                                                                                              
                                                                                                                                
2:32:25 PM                                                                                                                    
                                                                                                                                
SYLVAN  ROBB, ADMINISTRATIVE  SERVICES DIRECTOR,  DEPARTMENT                                                                    
OF CORRECTIONS,  OFFICE OF MANAGEMENT  AND BUDGET,  spoke to                                                                    
FN 6  from Department  of Corrections, OMB  component number                                                                    
1381. She  noted that  the fiscal note  did not  address the                                                                    
bill committee  substitute, and  the department  was working                                                                    
to update the note.                                                                                                             
                                                                                                                                
Co-Chair von  Imhof appreciated  discussing the  fiscal note                                                                    
with the understanding that it would change.                                                                                    
                                                                                                                                
Ms. Robb stated  that the majority of the  fiscal note would                                                                    
still  stand.  There  was  language  in  the  analysis  that                                                                    
referenced DNA collection, which would be removed.                                                                              
                                                                                                                                
Co-Chair von Imhof queried the OMB number.                                                                                      
                                                                                                                                
Ms. Robb replied that it was OMB 1318.                                                                                          
                                                                                                                                
2:34:25 PM                                                                                                                    
                                                                                                                                
Ms.  Robb continued  that the  costs related  to the  fiscal                                                                    
note were  for the  increased sentences. The  estimates were                                                                    
arrived  using the  number of  offenders in  the system  for                                                                    
2018, while looking  back at the length of  stay for similar                                                                    
stays in 2014 since many parts  of the bill went back to law                                                                    
in place in 2014.                                                                                                               
                                                                                                                                
Co-Chair von  Imhof noted  that the  fiscal note  was broken                                                                    
down  into  sections and  showed  an  estimated increase  in                                                                    
inmates while referencing bill sections.  She asked how many                                                                    
additional inmates were estimated in total.                                                                                     
                                                                                                                                
Ms.   Robb  stated   that  the   department  projected   465                                                                    
additional inmates in the first  year, and additional 523 in                                                                    
the second  year, and  then an additional  528 in  the third                                                                    
year and beyond.                                                                                                                
                                                                                                                                
Co-Chair von Imhof asked if the  state had the space for the                                                                    
estimated increase in inmate population.                                                                                        
                                                                                                                                
Ms. Robb  stated that current  operations did not  allow for                                                                    
those additional inmates.                                                                                                       
                                                                                                                                
Senator Wilson queried the current capacity.                                                                                    
                                                                                                                                
Ms.  Robb  replied  that the  general  capacity  within  the                                                                    
system was 4664  beds, and a maximum capacity  could only be                                                                    
functional for  30 days before court  standards. The maximum                                                                    
capacity was 4838.                                                                                                              
                                                                                                                                
Senator Micciche  asked if  the state was  at 92  percent of                                                                    
prison capacity.                                                                                                                
                                                                                                                                
Ms. Robb replied in the  affirmative, but it fluctuated from                                                                    
day to day.                                                                                                                     
                                                                                                                                
Senator Micciche surmised  that there was room  for 440 more                                                                    
before maximum capacity.                                                                                                        
                                                                                                                                
Ms. Robb  trusted that calculation. She  reiterated that the                                                                    
system was  not able to  operate at maximum  capacity beyond                                                                    
30 days.                                                                                                                        
                                                                                                                                
Senator  Micciche  asked  if  maximum  capacity  included  a                                                                    
Palmer Correctional Facility.                                                                                                   
                                                                                                                                
Ms.  Robb  replied  that  it  did  not  include  the  Palmer                                                                    
Correctional Facility.                                                                                                          
                                                                                                                                
Co-Chair  von Imhof  queried the  cost and  capacity if  the                                                                    
state was to reopen the Palmer Correctional Facility.                                                                           
                                                                                                                                
Ms.  Robb  stated  that  the   department  had  looked  into                                                                    
reopening the  Palmer facility. The one-time  cost to reopen                                                                    
the  facility was  approximately  $5.8  million. She  stated                                                                    
that  many  of  the  equipment and  usable  items  had  been                                                                    
distributed  to  other  institutions. She  stated  that  the                                                                    
fiscal note reflected the cost  to run the facility, but did                                                                    
not include the one-time cost.                                                                                                  
                                                                                                                                
2:40:41 PM                                                                                                                    
                                                                                                                                
Co-Chair  von  Imhof  asked  for  the  cost  to  reopen  the                                                                    
facility.                                                                                                                       
                                                                                                                                
Ms. Robb stated $5.8 million.                                                                                                   
                                                                                                                                
Co-Chair  von  Imhof  queried  the number  of  beds  in  the                                                                    
facility.                                                                                                                       
                                                                                                                                
Ms. Robb did not know the capacity.                                                                                             
                                                                                                                                
Co-Chair  von Imhof  asked for  an estimate  of the  beds in                                                                    
Palmer.                                                                                                                         
                                                                                                                                
Ms. Robb estimated several hundred.                                                                                             
                                                                                                                                
Senator Wielechowski thought  from FY 20 to FY  25 there was                                                                    
roughly  $245  million  in additional  costs,  and  wondered                                                                    
whether  it  was  anticipated  that  substantial  additional                                                                    
funds  would   be  required  to   obtain  the   capacity  to                                                                    
incarcerate the offenders.                                                                                                      
                                                                                                                                
Ms. Robb stated that  the additional cost required (assuming                                                                    
capacity  stayed the  same) would  be the  one-time cost  of                                                                    
$5.8 million to re-open the Palmer facility.                                                                                    
                                                                                                                                
Senator  Wielechowski surmised  that  there was  substantial                                                                    
additional costs.                                                                                                               
                                                                                                                                
Ms.  Robb stated  that the  additional cost  to operate  the                                                                    
Palmer facility would be the  one-time cost to reopen, which                                                                    
was $1.8 million.                                                                                                               
                                                                                                                                
Senator  Wielechowski   wondered  whether  there   would  be                                                                    
additional costs.                                                                                                               
                                                                                                                                
Ms. Robb replied  that the cost to operate  the facility was                                                                    
reflected in the fiscal note.                                                                                                   
                                                                                                                                
Co-Chair von Imhof thought it  might be necessary to re-open                                                                    
the  Palmer   facility  if  the  number   estimated  inmates                                                                    
materialized. She hoped that the  department was preparing a                                                                    
tentative plan.  She knew that the  department had initially                                                                    
proposed 500  inmates down  south, and did  not know  of the                                                                    
status of that proposal.                                                                                                        
                                                                                                                                
2:44:54 PM                                                                                                                    
                                                                                                                                
Senator Wilson  asked about if  the numbers  quoted included                                                                    
the number of  prisoners that would be  exiting, and whether                                                                    
they were first-time or repeat offenders.                                                                                       
                                                                                                                                
Ms. Robb  stated that it  took into account that  those were                                                                    
in and  out of the facilities  over the course of  that time                                                                    
period.                                                                                                                         
                                                                                                                                
Senator Wilson asked if the  numbers of individuals entering                                                                    
the   system  included   first-time   offenders  or   repeat                                                                    
offenders.                                                                                                                      
                                                                                                                                
Ms. Robb noted that it was all manner of offenders.                                                                             
                                                                                                                                
2:46:31 PM                                                                                                                    
                                                                                                                                
Senator Wilson  looked at  Mr. Skidmore's  presentation from                                                                    
the  previous day  (copy on  file). He  thought some  of the                                                                    
violations were  technical and wondered if  adjustment would                                                                    
lower the number.                                                                                                               
                                                                                                                                
Senator Wielechowski asked if there  was a reason the fiscal                                                                    
note did not  reflect the $5.8 million needed  to reopen the                                                                    
Palmer facility.                                                                                                                
                                                                                                                                
Ms. Robb specified  that the fiscal note  was addressing the                                                                    
governor's  amended budget,  which  offered sending  inmates                                                                    
out of state.                                                                                                                   
                                                                                                                                
Senator Wielechowski  thought he  heard Ms. Robb  state that                                                                    
there was no plan to send inmates out of state.                                                                                 
                                                                                                                                
Ms. Robb  reminded that the  operating budget  was currently                                                                    
in the hands of the legislature.                                                                                                
                                                                                                                                
Co-Chair  von   Imhof  asserted   that  the   committee  was                                                                    
considering SB  32. She thought  it was important to  have a                                                                    
fiscal note that  would address what was in  the bill rather                                                                    
than what was wanted by the governor.                                                                                           
                                                                                                                                
2:50:30 PM                                                                                                                    
                                                                                                                                
Senator Micciche  thought it was  important to keep  in mind                                                                    
that  there were  many beds  in the  system, and  there were                                                                    
many  levers  in the  operation  management  that could  not                                                                    
result  in  overcrowding. He  noted  that  DOC had  taken  a                                                                    
conservative stance.                                                                                                            
                                                                                                                                
Ms.  Robb stated  that the  length of  sentence used  in the                                                                    
estimate was not  based on the sentencing  range, rather the                                                                    
actual time-served was used to make the determination.                                                                          
                                                                                                                                
Senator  Wielechowski  wondered  whether  the  number  would                                                                    
increase after the passage of the bill.                                                                                         
                                                                                                                                
Ms. Robb stated that the  fiscal note reflected the addition                                                                    
of the extra inmates.                                                                                                           
                                                                                                                                
Senator   Wielechowski  considered   that   the  number   of                                                                    
prisoners  would  increase  by   hundreds  beyond  the  2018                                                                    
numbers.                                                                                                                        
                                                                                                                                
Ms. Robb  affirmed that  the department  limited projections                                                                    
to that for which data was available.                                                                                           
                                                                                                                                
Co-Chair  von  Imhof  agreed  that  DOC  was  a  down-stream                                                                    
agency.  She was  not sure  if the  fiscal note  reflected a                                                                    
high range or  medium range. She stressed  the importance of                                                                    
accuracy in the fiscal note.                                                                                                    
                                                                                                                                
2:56:40 PM                                                                                                                    
                                                                                                                                
Senator  Wielechowski  thought  Co-Chair von  Imhof  made  a                                                                    
great point. He  thought the fiscal note was off  by tens of                                                                    
millions of dollars per year.                                                                                                   
                                                                                                                                
Co-Chair von Imhof suggested that  Ms. Robb had an option to                                                                    
provide fiscal ranges when updating the fiscal note.                                                                            
                                                                                                                                
Senator Micciche thought fiscal ranges were a good idea.                                                                        
                                                                                                                                
Senator Bishop  encouraged the department not  to "low ball"                                                                    
the fiscal note.                                                                                                                
                                                                                                                                
Senator  Wilson   stated  that  the  Palmer   facility  held                                                                    
approximately  500 minimum  to medium  security inmates.  He                                                                    
stressed  that   the  bills  would  hopefully   address  the                                                                    
credits.  He stressed  that the  numbers  may go  up in  the                                                                    
current bill, but  there were other bills  that could reduce                                                                    
the cost.                                                                                                                       
                                                                                                                                
3:01:12 PM                                                                                                                    
                                                                                                                                
NANCY MEADE,  GENERAL COUNSEL,  ALASKA COURT  SYSTEM, stated                                                                    
that  the Courts  did not  have a  position on  the policies                                                                    
reflected in the bill. The one  section of the bill that had                                                                    
a great impact  was Section 49, which required  the Court to                                                                    
provide old mental commitment orders DPS.                                                                                       
                                                                                                                                
Ms. Meade thought  other sections of the bill  would lead to                                                                    
increased  filings, and  would lead  the Court  to submit  a                                                                    
fiscal note.                                                                                                                    
                                                                                                                                
Ms. Meade addressed FN 9 from the Judiciary.                                                                                    
                                                                                                                                
3:07:09 PM                                                                                                                    
                                                                                                                                
Senator Wielechowski  asked about the typical  caseload of a                                                                    
Superior Court judge.                                                                                                           
                                                                                                                                
Ms. Meade replied that it  varied depending on location, but                                                                    
in  Anchorage some  have as  many as  660 cases.  She stated                                                                    
that   the  smaller   locations  that   sometimes  conducted                                                                    
district work saw substantially less numbers.                                                                                   
                                                                                                                                
Senator  Wielechowski stated  that  LAW  submitted a  fiscal                                                                    
note  that  showed  just  for   increasing  on  felony  drug                                                                    
offenses would  result in  740 more  cases. He  wondered how                                                                    
one additional  judge would deal  with all those  cases, and                                                                    
whether there should be additional judges.                                                                                      
                                                                                                                                
Ms. Meade  replied that it  was unknown. She noted  that the                                                                    
misdemeanor cases had reduced in the last previous year.                                                                        
                                                                                                                                
3:09:47 PM                                                                                                                    
                                                                                                                                
Co-Chair von  Imhof knew that  Ms. Meade had  concerns about                                                                    
the date of  1981 in the Section 49 of  the bill relating to                                                                    
submission of mental health commitments.                                                                                        
                                                                                                                                
Ms. Meade  explained that  that problem  with the  old cases                                                                    
was access. She noted that  the change would cost additional                                                                    
staff time to  access the files. The need  was not reflected                                                                    
in the fiscal note.                                                                                                             
                                                                                                                                
Co-Chair  von Imhof  thought Ms.  Meade had  made a  comment                                                                    
about the cases.                                                                                                                
                                                                                                                                
Ms. Meade thought  there was about 22,000  cases that needed                                                                    
to be examined.                                                                                                                 
                                                                                                                                
Co-Chair von Imhof hoped that  Ms. Meade could work with LAW                                                                    
to  let the  members  know  if the  provision  needed to  be                                                                    
addressed.                                                                                                                      
                                                                                                                                
Senator  Wielechowski asked  if there  had been  analysis on                                                                    
the impact  on the number of  cases that would be  tried. He                                                                    
thought when court fees were increased.                                                                                         
                                                                                                                                
Ms. Meade stated there was no analysis of the increase in                                                                       
trial rate.                                                                                                                     
                                                                                                                                
3:14:32 PM                                                                                                                    
                                                                                                                                
Senator Wilson asked if SB 91 changed global resolution of                                                                      
charges.                                                                                                                        
                                                                                                                                
Ms. Meade knew that plea bargains could be resolutions of                                                                       
multiple charges.                                                                                                               
                                                                                                                                
Senator Olson thanked Ms. Meade for her straight-forward                                                                        
answers. He thought some fiscal notes were lacking.                                                                             
                                                                                                                                
Co-Chair von Imhof asked members to work with her staff to                                                                      
consider proposed amendments.                                                                                                   
                                                                                                                                
SB 32 was HEARD and HELD in committee for further                                                                               
consideration.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
3:18:27 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:18 p.m.                                                                                          

Document Name Date/Time Subjects
04 23-25 19 LFD SFC Long-Term Plan-1.pdf SFIN 4/25/2019 9:00:00 AM
LFD Fiscal Plan
042519 SFIN LFD Fiscal Model Outputs.pdf SFIN 4/25/2019 9:00:00 AM
LFD Fiscal Plan
SB 32 Representing Dosages of Opioids 04.25.19.pdf SFIN 4/25/2019 9:00:00 AM
SB 32
SB 32 New Fiscal Note LAW.pdf SFIN 4/25/2019 9:00:00 AM
SB 32