Legislature(2007 - 2008)BELTZ 211
03/04/2008 09:00 AM Senate STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| SB265 | |
| SB276 | |
| HB259 | |
| SB296 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 276 | TELECONFERENCED | |
| + | SB 265 | TELECONFERENCED | |
| *+ | SB 296 | TELECONFERENCED | |
| + | HB 259 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 296-CRIME VICTIM COMPENSATION FUND
VICE-CHAIR STEVENS announced the consideration of SB 296.
9:43:16 AM
TREVOR FULTON, Staff to Senator McGuire, Alaska State
Legislature, said SB 296 creates a non general fund program for
the Violent Crimes Compensation Board (VCCB), which generates
funds for the board with no additional outlay of state funds.
The arguments for and against putting dedicated funds into
statute are familiar territory. It would be the 83rd such fund
on the books. It is difficult to argue that the state is better
off forgoing the additional $0.60 in federal grants that would
be generated for every dollar put into the compensation fund.
The mission of the VCCB is to mitigate the financial hardships
innocent victims can suffer as a direct result of violent crime.
The board may pay for medical expenses, counseling, lost income,
funeral expenses, and other costs for Alaska victims of violent
crimes. SB 296 will generate additional funds for this program
without additional appropriations.
9:45:04 AM
SENATOR GREEN read a part of the bill and asked where the
connection is with the source of the money that is coming in.
She asked what funds the bill is talking about.
SENATOR FRENCH said the sponsor statement says that the VCCB
awards $1.3 million every year. In paragraph three, it says if
the VCCB can get these funds that it's taking to pay into the
budget, it would have gotten an extra $.60 on every dollar in
federal grants. The last sentence says without any effort the
VCCB would have gained almost $1 million in ten years. "You must
not be talking about all of the money received, because if
you're giving out $1 million a year and you're [getting] $0.60
on every dollar, if you just get that money into a special fund,
then you should be talking about $600,000 a year." There is a
disconnect between the money coming from the federal government
and the money the VCCB is taking in.
9:47:15 AM
VICE-CHAIR STEVENS said the bill is not moving today because
Chair McGuire has left.
GERAD GODFREY, Chair, Violent Crimes Compensation Board, Juneau,
said he doesn't understand the question. When anyone comes to
the board with a claim, they sign a subrogation agreement. The
maximum for any victim is $40,000. That is entirely
compensatory. It has to be tangible losses, like medical,
counseling, lost wages, and relocation expenses. For example,
someone comes who was a victim of a DWI. "We know they're going
to win a lawsuit insurance settlement," but that will take time.
But this person is out of work and bills are piling up. The
board gives money, and it is a de facto loan. When the person
tries to pay it back, the board has no means to accept it - it
has no receipt authority. That money that operated as a loan
while awaiting a suit could compensate other victims, but
instead it goes into the general fund. The $0.60 on the dollar
is available regardless of what the state puts up. The board is
funded through garnished PFDs of felons.
9:50:36 AM
MR. GODFREY said during the Murkowski administration, "we were
looking at a $400,000 decrement because the PFD average had gone
down so much. However that money gets put up, it is eligible for
$0.60 to the dollar in federal matching funds." There is no cap
on the federal money. He spoke of a graph illustrating the money
that originated from the board's initial funding, which came
from the garnished PFD money. "When it comes back to us, we
don't get it; it goes to the general fund." If that money were
put back into the VCCB fund, it would be eligible, yet again,
for the $0.60 federal match. Ultimately, if the board was given
the money that it recuperates, in the next era of decrements the
board believes it could sustain itself.
9:52:58 AM
SENATOR GREEN suggested a review of the language in Section 1,
because she finds it confusing. She asked, "Is it improper to
use the word such as subjugation, or court-ordered restitution?"
SENATOR FRENCH said the clearer the better.
SENATOR FRENCH said he is fuzzy on the details. It is not clear
why some dollars count for the federal match and why some don't.
MR. GODFREY said all the money the state puts up, whatever the
source, is eligible for the sixty cents on the dollar. The money
that is eligible that the VCCB puts up this year that didn't get
expended because of recuperation comes back and is eligible
again, rather than a different allocation of money. "If $30,000
was put up this year and therefore it's eligible for sixty cents
to the dollar federal money, and it was utilized in the form of
that illustration I gave you, like the DWI victim, that $30,000,
and it comes back to us again, next year that same $30,000 is
yet again eligible for sixty cents to the dollar. Rather than
using new money, we're using the same money to get that sixty
cents on the dollar again."
9:55:52 AM
SENATOR BUNDE said it just recycles the money. It is almost an
arbitrage thing. It seems barely legal.
VICE-CHAIR STEVENS said, "But do you object to that?"
SENATOR BUNDE said no.
SENATOR GREEN said the problem is that the money that comes back
in from subrogation goes to the general fund and never gets back
into your account; therefore, you cannot get the sixty cents.
MR. GODFREY said it is fuzzy, but whatever the state puts up
next year - from the general fund, garnished PFDs, or the money
that the fund retains -- it will still be eligible for the
match. "We are double dipping that same money." The federal
money is available regardless of how the state puts it up. The
money can be used again after it operates as a de facto loan and
get the sixty cents on the dollar that it already received.
SENATOR BUNDE said the bill just cuts out a step - the $30,000
comes back and goes to the general fund, and the legislature
appropriates it, but it may decide not to. But if this is money
that VCCB generated, maybe it should go back to them.
MR. GODFREY said exactly.
9:58:30 AM
MR. GODFREY said the amount that comes back to the VCCB was not
expended - it was recuperated. It should still be available to
serve its purpose. The board imposed policy limitations on how
much it would award certain categories. It had to restrict
awards dramatically. It could either help the first 30 percent
of claimants with 100 percent of their needs or help all of them
at 55 percent of what they were entitled too. He hopes SB 296
will change that.
SENATOR BUNDE said if someone is convicted, they lose their PFD
to the victim. When the victim repays, the money goes to the
general fund. But this program generates money for the general
fund, and if SB 296 passes, that money goes back to the VCCB.
"It is money they generated anyway."
VICE-CHAIR STEVENS said the state provides a dollar and it is
matched with sixty cents. It gets loaned to a victim, and then
when the victim pays it back, it can get a federal match again
if it goes into the VCCB fund.
MR. GODFREY said Senator Stevens definitely has the concept.
10:00:57 AM
SENATOR FRENCH said he supports the board, and maybe there
should be a revised fiscal note. It sounds like the state would
be spending less general funds.
SENATOR GREEN asked if the board is ever not repaid.
MR. GODFREY said there are limited resources and only three
staff. "We do not have a whole lot of motivation - the board
itself is all volunteers -- to pursue those people that -
everyone had to sign a subrogation agreement - those people that
ultimately are going to win a lawsuit and if the perpetrator is
solvent - perhaps the perpetrator worked on the Slope and has
some cash in the bank or what-have-you. We do not expend the
resources to go after that because we can't recuperate it, so it
just doesn't serve our purpose to spend our limited resources to
pursue somebody who we know can give us back that $25,000 when
we're not going to recuperate it." He said it is not time well
spent by the board to pursue money owed to the VCCB. Typically
they will retain an attorney, especially if it is not an
insurance settlement, and then they are obliged to disclose
that. He estimated that 90 percent of the time their attorney
will petition the board to ask forgiveness on the subrogation.
They will give their best compelling argument as to why. One
example may be a resultant injury that requires more therapy.
The board wants an attorney to give a good pitch, "and we pretty
much take it at the first blush … because to spend the resources
to vet out the veracity of what the attorney is saying … he's
going to make the best argument and sometimes we buy it,
sometimes we don't." If the board knew it could recuperate it,
it would spend more time and ask for more documentation and some
follow-up from the attorney. "Yes, there's times when we do not
recuperate money that was due us."
10:04:35 AM
SENATOR GREEN suggested that it would be difficult to
approximate what the board could get back from people, and she
asked if his attitude would change if SB 296 passes.
MR. GODFREY said it would change because the board could become
self sufficient by recuperating that money -- and lean on the
general fund less and less to the point of not needing it at
all. There would then be more motivation to go after it. He
would probably develop a series of steps for an attorney to go
through. "We would like to go after the money whether it's going
to the general fund or not; we just don't have the resources."
SENATOR GREEN asked if he would object to language in the bill
asking the board to pursue the payments.
MR. GODFREY said he would have no problem with that.
VICE-CHAIR STEVENS suggested working on the sponsor statement.
SENATOR FRENCH said he would like to hear from the people who
prepared the fiscal note and who oversee the funds.
VICE-CHAIR STEVENS said also to pursue Senator Green's idea.
MR. GODFREY said the board has been working on this for years
and he appreciates the opportunity to provide clarity.
VICE-CHAIR STEVENS set SB 296 aside and adjourned the meeting at
10:08:03 AM.
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