Legislature(1999 - 2000)
01/14/2000 08:07 AM House BUD
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
JOINT COMMITTEE ON LEGISLATIVE BUDGET AND AUDIT
January 14, 2000
8:07 a.m.
MEMBERS PRESENT
Representative Gail Phillips, Chair
Representative Con Bunde
Representative Eric Croft
Representative Gary Davis
Representative Gene Therriault
Representative Eldon Mulder (Alternate)
Senator Randy Phillips, Vice Chair
Senator Al Adams
Senator Rick Halford
Senator Gary Wilken
Senator Drue Pearce (Alternate)
MEMBERS ABSENT
Senator Sean Parnell
COMMITTEE CALENDAR
APPROVAL OF MINUTES
CONSIDERATION OF RPLs
EXECUTIVE SESSION
AUDIT REPORTS
REPORT FROM THE DENALI COMMISSION
OTHER COMMITTEE BUSINESS
ADJOURNMENT
WITNESS REGISTER
DAVID TEAL, Legislative Fiscal Analyst
Legislative Finance Division
Alaska State Legislature
P.O. Box 113200
Juneau, Alaska 99811
POSITION STATEMENT: Provided an explaination of the two RPLs up
for consideration.
TOM LAWSON, Director,
Division of Administrative Services,
Department of Community and Economic Development (DCED)
P.O. Box 110803
Juneau, Alaska 99811
POSITION STATEMENT: Provided information on the RPL 08-0-0101.
JANET CLARK, Director
Division of Administrative Services
Department of Health and Social Services (DHSS)
P.O. Box 110650
Juneau, Alaska 99811
POSITION STATEMENT: Provided information on the RPL 06-0-0180.
MATT ANDERSON, Unit Manager
Community Health and Emergency Medical Services (EMS)
Department of Health and Social Services
P.O. Box 110650
Juneau, Alaska 99811
POSITION STATEMENT: Provided information on the RPL 06-0-0180.
KRAG JOHNSON, Legislative Coordinator
Denali Commission
510 L Street, Number 410
Anchorage, Alaska 99501
POSITION STATEMENT: Presentation on the Denali Commission.
JEFF STASER, Co-Chairman
Denali Commission
510 L Street, Number 410
Anchorage, Alaska 99501
POSITION STATEMENT: Presentation on the Denali Commission.
ACTION NARRATIVE
TAPE 00-1, SIDE A
Number 0001
CHAIR GAIL PHILLIPS called the Joint Committee on Legislative
Budget and Audit meeting to order at 8:07 a.m. Members present at
the call to order were Representatives Phillips, Bunde, Croft,
Davis and Therriault, and Senators Phillips and Wilken.
Representative Mulder and Senators Adams, Halford and Pearce
arrived after the call to order.
CHAIR PHILLIPS introduced her new committee staff, Pat Hartley from
Homer.
The following staff members from the Legislative Finance Division
introduced themselves: Ginger Blaisdell, Fiscal Analyst, who is
responsible for the Department of Health and Social Services (DHSS)
and the statewide operating budget; Rob Carpenter, Fiscal Analyst,
who is responsible for the Department of Law, the Department of
Public Safety, the Department of Corrections and the Alaska Court
System; Michael Crabb, Fiscal Analyst, who is responsible for the
University of Alaska, the Department of Environmental Conservation
(DEC) and the Department of Natural Resources (DNR); Tracy
Carpenter, Fiscal Analyst, who is responsible for the capital
budget and the Department of Transportation (DOT); Amanda Ryder,
Fiscal Analyst, who is responsible for the Department of Community
and Economic Development (DCED), the Department of Military and
Veterans Affairs (DMVA), the Department of Fish and Game (ADF&G)
and the Department of Revenue (DOR); Diana Forbes (ph), not
present, who is responsible for the Department of Administration
and the Department of Labor and Workforce Development.
APPROVAL OF MINUTES
CHAIR PHILLIPS indicated that the first order of business is the
approval of the minutes from the Legislative Budget and Audit
meeting held on December 16, 1999.
Number 0250
SENATOR PHILLIPS made a motion to approve the minutes from the
December 16, 1999, meeting.
CHAIR PHILLIPS asked whether there was any objections. There being
none, the minutes from the December 16, 1999, meeting were approved
as read.
CONSIDERATION OF RPLS (REVISED PROGRAM - LEGISLATIVE)
Number 0268
CHAIR PHILLIPS indicated that the next order of business is the
consideration of the RPLs. The first RPL under consideration is
08-0-0101/DCED Industry Network Corporation Grant.
Number 0312
DAVID TEAL, Legislative Fiscal Analyst, Legislative Finance
Division, Alaska State Legislature, explained that the RPL,
08-0-0101, is a grant for $145,000 and contains two parts; one
part is for the forest products development specialist and the
second is a grant intended to help match Alaska companies with
overseas buyers. He indicated that there are a number of subparts;
it will fund some salaries and space that are currently obligations
of the agency; it will also fund an Alaska products catalogue and
provide some assistance to Alaska companies. He summarized by
saying that it pays to do some things that the DCED is already
doing, because it will free up money to pay for the forest products
development specialist, which is in the first part of the grant.
He pointed out that the Legislative Budget and Audit Committee took
up the RPL, 08-0-0101, in the last meeting on December 16, 1999.
He indicated that some concerns were expressed; one was that cuts
were made in these areas during the last legislative session and
the Legislative Budget and Audit Committee was not sure of the
subcommittee's approval of those cuts. Second, there was a formal
memo written by the subcommittee chair objecting to those cuts, but
the objection has been withdrawn. Third, there was a concern with
future funding. In the DCED's December 16, 1999 presentation, it
appeared tha the funding was speculative beyond this fiscal year
and the Legislative Finance Division spoke with the Industry
Network Corporation (INC) and it indicated that there was a good
chance of receiving some continued funding, but there are no
promises.
TOM LAWSON, Director, Division of Administrative Services,
Department of Community and Economic Development (DCED), indicated
that there were some concerns expressed at the last Legislative
Budget and Audit meeting by Representative Austerman, who submitted
a letter to the committee. Representative Austerman's concerns
were addressed and he has withdrawn his objection to the RPL,
08-0-0101. He explained that at the last meeting it appeared that
perhaps the scope of work for the forest products effort is a bit
ambitious considering the time frame that remains in the fiscal
year. He pointed out that what wasn't made clear during the
meeting on December 16, 1999, was that most, if not all, the
projects are at an advanced stage of completion and the DCED is
seeking to have someone in place for the remainder of this fiscal
year in order to complete those projects, which would enable the
DCED to recoup the time and money already invested in the projects
and bring those projects to fruition. One of those projects is a
directory of Alaska sawmills; there are approximately 100 sawmills
in Alaska and more than 60 of those companies have already provided
information to be included in the directory to be distributed to
buyers of Alaska forest products and development of the web site.
The other project is the promotion of Alaska's value added products
in Japan, Korea and Taiwan; one of those main projects is the
production and distribution of an Alaska products catalogue in the
language of the customer, which would be distributed at trade shows
and one-on-one meetings with potential buyers.
CHAIR PHILLIPS asked, "For clarification, the department [DCED] has
been doing these projects, they've been doing these things -- this
money will pay the department [DCED] back?"
MR. LAWSON responded that in terms of the marketing of Alaska's
value added products in Asia those were projects that were already
budgeted for and with the Industry Network Corporation Grant, RPL
08-0-0101, providing funds to do that those funds can be allocated
toward the forest products specialist position for the remainder of
this fiscal year.
Number 0602
REPRESENTATIVE BUNDE wondered if it would involve hiring an
employee and paying his or her salary. He referred to the
expression "soft money," which gives verbal assurance that the
grant will continue. He asked, "If the money goes away does the
employee go away?"
MR TEAL indicated that the DCED assured them that the grant would
continue.
REPRESENTATIVE BUNDE noted that one of the other reasons the RPL,
08-0-0101, was turned down at the December 16, 1999, meeting was
that the legislative session's start was very near.
SENATOR PHILLIPS made a motion to approve the RPL, 08-0-0101/DCED
Industry Network Corporation Grant.
CHAIR PHILLIPS asked for unanimous consent. There being no
objection the RPL, 08-0-0101/DCED Industry Network Corporation
Grant was approved. She indicated that the next order of business
is the RPL, 06-0-0180/HSS Public Preparedness for Bioterrorism.
Number 0717
MR. TEAL explained that (indisc. -- paper shuffling) $700,000 in
federal receipts from the Center for Disease Control bioterrorism
preparedness and response program. The intent is to detect and
respond to outbreaks of bioterrorism, increase the state's
biological laboratory capacity and improve public health electronic
communication, and up front equipment purchases. He indicated that
the RPL, 06-0-0180, was discussed at the December 16, 1999, meeting
and the concerns expressed were the sense of urgency, how soon does
it need to be approved and that it was a new initiative; RPLs are
intended to fund existing programs and a new initiative should
really have full legislative review. The third concern was with
the six positions, which the new write-up has as three new
positions and three filling-vacancy positions.
Number 0804
JANET CLARK, Director, Division of Administrative Services,
Department of Health and Social Services (DHSS), indicated that Mr.
Teal adequately described the RPL, 06-0-0180, $700,000 and there is
no state match required; it is a four year grant. The grant was
awarded on August 30, 1999 and there is a letter from the federal
agency basically saying that there are some time sensitive actions
that the DHSS needs to take in the first grant year or it will
jeopardize getting the second, third and fourth year grants. She
noted that the DHSS has a requirement to spend the equipment
dollars in the first year, because waiting until the start of the
new fiscal year, July 1, 2000, will not allow time to purchase the
equipment and have it in place as required by the grant. She said
that in January, after the Legislative Budget and Audit meeting in
December, the DHSS received a noticed from the Center for Disease
Control (CDC) about an anthrax threat to planned parenthood
agencies in many states. The DHSS wanted to include this
information to help the committee understand that it is a real
threat that is becoming more common. She added that there was no
threat in Alaska.
MS. CLARK further stated that they view this as a way to build the
infrastructure for Alaska using federal money. As opposed to the
DCED's RPL these activities are not part of their regular work
plan. This is a new activity for them and they think it will help
strengthen Alaska's program. It was a competitively awarded grant;
Alaska was one of 20 states to receive it. The federal government
does see Alaska as strategically located. There is a lot of
support from the military and Federal Bureau of Investigation
(FBI), because of the military presence in Alaska and the pipeline.
She added that Alaska was almost a sure in when they went for the
competitive proposal.
CHAIR PHILLIPS mentioned that in the House Finance Committee
meeting the previous day in conversations with the military there
seemed to be much more emphasis on bioterrorism. She noted that
bioterrorism is a concern for Alaska.
SENATOR PHILLIPS stressed that from this point forward he would
like the agencies to refrain from saying that this is only federal
funds. He stated, "We just went through a vote September 14.
People in Alaska obviously think we spend too much money; they
think the budget is $6 to $7 billion and they frankly don't care
whether it's federal or state or whatever. It's spending in the
state and the message we got last September is we are spending too
much money and they really don't give a rip whether it's state
general dollars or federal dollars, so I wish the agencies would
refrain from saying it's only federal funds. Therefore, ... we
should be concerned about it, because we just had a vote; 84
percent of them said, 'you spend too much money,' or at least
that's the interpretation, so be conscious of what you say on how
much money we're spending in the state of Alaska, whether its state
funds, receipts, or whatever."
MS. CLARKE said that she would take that into account.
REPRESENTATIVE CROFT stated, "Well, I'd urge you not to take it
into account. I think it makes a great deal of difference and you
should tell us whether it's federal money or program receipts or
general fund money; there's a lot of different interpretations and
it's, to some extent, our job and our job in the next election to
explain what we thought they meant in the vote, but yours is to
tell us the source of funds and the source of funds here is all
federal." He asked, "What were the criteria that were in the grant
that allowed us to receive it; strategic importance was one, I
guess, what were some of the others do you recall?"
MATT ANDERSON, Unit Manager, Community Health and Emergency Medical
Services (EMS), Department of Health and Social Services (DHSS),
indicated that there is indeed a heightened national concern about
bioterrorism and as a consequence federal money is being made
available to build public health infrastructures specifically for
the purpose of identifying and responding to bioterrorist threats.
The application actually allowed the DHSS to apply for funding in
several different categories including laboratory capacity,
epidemiology capacity, health alert network and a few others.
REPRESENTATIVE CROFT wondered, "Would the military necessarily tell
us if there'd been a threat to military institutions, might they
keep that secret?"
MR. ANDERSON said that he did not know the answer. He informed the
committee, "I know that we have an outstanding rapport with the
military and involve them in all of our planning. I would suspect
that they would make us aware of anything that threatened the
civilian population and I do know that the FBI [and] the military
are always concerned about the safety of the citizenry and I would
suspect that they would make any threats known if they thought we
could do something about it."
CHAIR PHILLIPS explained that the legislature was informed that
there will be a 20-member team of bioterrorism specialists that
will be assigned to Alaska and they will be able to work with any
local government entity that has a threat against them, like a fire
department or a police department. She added that Alaska is one of
the few states that has been assigned this specialized team.
Number 1141
REPRESENTATIVE BUNDE indicated, "I share Senator Phillip's concern
that for those, not admittedly, not everyone views it that way, but
for those who take $6 billion plus and divide it by their residents
of the state and say we are outrageous in our spending, this adds
fuel to their frustration and again their frustration doesn't
matter. The money comes from the people whether it's federal
dollars or it's -- more of it, a greater percentage of it comes
from, if it's federal dollars, from you and I than if it's state
dollars, because we don't pay any state income tax; we most
certainly pay federal income taxes." He asked, "You said this was
granted on a competitive basis, 1 of 20 states, is that because
Alaska has a higher threat of bioterrorism ...?
MR. ANDERSON stated, "Alaska was seen as having strategic
importance partly because of its remoteness. Calling for the
calvary means quite a lag in response and we needed to develop --
they understood that we needed to develop some self-sufficiency up
here. One of the consequences of that was that Anchorage was named
as one of 127 cities to be designated as a metropolitan medical
strike team to build their infrastructure within their community,
but more importantly the federal government, I think, wanted to
prime the pump to get enhanced capabilities to detect both,
particularly covert bioterrorist events and have responses that
protect not only the citizens but the rescuers. An interesting
note regarding the raid team that's being assigned to Alaska and an
interesting irony is the fact that all of these teams that are
being built in Anchorage ... are somewhat dependent, I think in
varying degrees, but some largely dependent on the ability of the
Department of Health and Social Services to rapidly identify that
an event has occurred and identify or rule out a particular agent.
And I think if history is any indication it's only a matter of time
before the anthrax threats march across the country and -- so far
they're in Wisconsin, but I think it's probably a matter of time
before they're here and I think we need to be prepared for that and
I think this gives us a great opportunity to get our house in order
with respect to bioterrorism at the same time significantly
improving our basic public health infrastructure."
Number 1283
REPRESENTATIVE CROFT asked, "This allows us to detect so that then
we can call this swat team or the military swat team -- how does
this augment the military response capability that Representative
Phillips talked about?"
MR. ANDERSON said that he has not been entirely briefed on the
capabilities of the raid team and they have yet to be trained. He
pointed out that Alaska was named as a recipient of the raid team
only that morning.
REPRESENTATIVE CROFT wondered, in general terms, how they are
informed of an outbreak.
MR. ANDERSON said that there would be two different kind of events;
an overt event where you receive a letter that says, 'you've just
been exposed to anthrax,' or a covert event where you have one very
sick person going to one hospital and another very sick person
going to a different hospital and the inability to put those
together.
REPRESENTATIVE CROFT clarified that by using the term 'covert' Mr.
Anderson means that there is no announcement and people just start
getting sick and how quickly they can figure out that it isn't just
the flu.
Number 1357
MS. CLARKE indicated that the funds were not earmarked in any
appropriation bill by Senator Ted Stevens at the federal level. It
was from the federal agency itself and in that sense it was
certainly competitive.
SENATOR WILKEN stated that he too would like to know the source of
the funds. He pointed out that he draws a very bright line between
his money and the federal government's money. If he is presented
with a project that he feels is good for the people of Alaska then
he is willing to spend his money and if he can get some help from
tax dollars from Arkansas or New York he would do that as well. He
informed the committee that he is not in the camp that is worried
about spending $6 billion. He wondered how the 20-person
contingency is going to interface with the money that is being
spent, because he can see that as time marches on they will be
linked up.
CHAIR PHILLIPS indicated that when the military has the team in
place the Legislative Budget and Audit committee could request a
report from them and hold another meeting later in the session also
with those people from the DHSS.
REPRESENTATIVE THERRIAULT wondered about the personnel request. He
clarified that their intention is to fill three vacant positions
and add three new ones instead of the original proposal, which was
to add six new positions.
MS. CLARKE said, "That's correct."
REPRESENTATIVE THERRIAULT clarified that there is $800,000 with
$200,000 to be spent on equipment and $100,000 a piece for each
position.
MS. CLARKE stated, "One of the issues with the information on the
RPL is that we were considering contracting for the microcomputer
technicians and so the money is in contractual for those positions,
however, this is one area that it's actually cheaper to hire state
employees than to go out on an hourly basis and contract, so we do
have to move that money into personal services so that's why the
dollars don't quite look right."
REPRESENTATIVE THERRIAULT asked Ms. Clarke to describe the
positions, because they will need to be looked at in the next
budget.
MS. CLARKE stated, "We're asking for three positions; a
microbiologist trained especially for biological agents to work in
the lab, a distance learning coordinator to ensure the
communication system is fully utilized for training and a public
health specialist to work with health and medical providers on
recording unusual disease events in some of these hospitals or
other positions.
REPRESENTATIVE THERRIAULT wondered if the DHSS has any of that
capability now as far as disease outbreaks or if someone is
monitoring disease outbreaks.
MS. CLARKE responded that they do have disease specialists, but
anthrax is a different biological agent and different skills are
needed.
Number 1535
MR. ANDERSON indicated that there are individuals who identify the
bugs and surveil for disease outbreaks; try to find the causes and
recommend treatment. Those resources are stretched very thin right
now, plus those individuals lack the training and capabilities to
deal specifically with biological agents. The individuals that
will be hired under the grant will be doing things that are much
different from their traditional calling. One of the things that
this grant does do is promote "dual use" where in times of stress
on those traditional resources these people can be used to assist
with a normal disease outbreak.
REPRESENTATIVE THERRIAULT wondered if these individuals hired under
the grant just equip-up and wait for the call to come or can they
assist in normal disease outbreaks.
MR. ANDERSON indicated that they have the individuals under a very
ambitious work plan; they will be developing capabilities over the
next four years in a very coherent manner to identify and respond
to bioterrorist events. When they are not engaged in those
activities or when a need comes for them to migrate to an emergic
response they have the capability to do so.
Number 1645
SENATOR PEARCE wondered how many private labs there are in the
state.
MR. ANDERSON said that he did not know the answer to that, but that
there are more and more each year; none of which have the
capability of doing the kinds of tests that are being done by the
public health lab.
SENATOR PEARCE wondered if the microbiologists would be working as
a training resource to the private labs.
MR. ANDERSON explained that part of the project is to ensure that
training takes place throughout the state, not only to state
personnel involved in surveillance, protection and response, but
also the private medical community so, to the extent that their
resources permit them, they can identify the organism or rule out
the organism. Therefore, even when that does occur the public
health laboratory will have significantly more resources than any
private lab in the state.
SENATOR PEARCE asked, "Are there federal labs in the state?"
MR. ANDERSON responded that there are federal labs in the state;
none of which have the capabilities for identifying these
particular organisms. Most of the organisms are sent out to the
Center for Disease Control surveillance.
Number 1704
SENATOR PEARCE stated, "So, we're planning as a state to develop
the expertise and the lab that will be responsible for training up
and down; up to the federal laboratory personnel, be they military
or civilian, and down to the private -- I don't mean up and down
pejoratively -- but, down to the private labs in the state. Just
in reading the description of the whole program it sounds like
we're using -- it sounds to me, reading between the lines, that
we're using the threat of a bioterrorist attack, which I take
seriously, as a way to fill in some positions that the department
would like to have that aren't necessarily all that ...
specifically centered on the bioterrorism; like a distance learning
coordinator. I know that Senator Stevens did get $30 million for
distance delivery in the state and I can't imagine we need another
distance learning coordinator, so I'm a little confused by all --
by some of the descriptions. So, one microbiologist in the state,
in the state lab, is suddenly going to be the person for the whole
state who sets up the system by which labs will be able to do the
work and catch and then find any sort of an attack statewide."
MR. ANDERSON responded that one microbiologist and one
epidemiologist will be responsible for building the capabilities
within those two sections. This is a multi-disciplinary and
multi-organizational project involving partners from the military,
from the municipality of Anchorage and from law enforcement to
ensure that their needs are being met and without efforts being
duplicated. Within those organizations, such as laboratories and
the section of epidemiology, a great deal of dialogue has taken
place to ensure that the entire organization is enhanced by this
and not simply relying on one person to do all the work, even
though that person will be primarily responsible for writing plans,
for identifying training opportunities and for ensuring that the
correct equipment is purchased.
Number 1814
SENATOR PEARCE wondered where the description of the other three
employees was listed.
MS. CLARKE indicated that on page 2 of the write up where it reads,
"existing vacant PCNs will be for microcomputer technicians."
SENATOR PEARCE said, "So, three microcomputer technicians."
MS. CLARKE responded, "Right. To keep the new communication system
up."
SENATOR PEARCE wondered who is keeping the system up now.
Number 1835
MR. ANDERSON explained that this particular communication system
does not exist. A major thrust of the federal initiative was a
health alert network, which would allow two things to occur; one is
very rapid alerting to health care providers that an event has
taken place and the second is the ability to conduct distance
learning in recognition of the fact that most of public health
throughout the country is inadequately trained, at this point, to
deal with terrorist events.
SENATOR PEARCE emphasized that there is an entire distance delivery
system of medical services in place and being built. She indicated
that $171,000 is not going to statewide system and certainly not
enough microcomputers to have three technicians.
MR. ANDERSON explained that the major initiative he knows of in
Alaska is called the AFHCAN (Alaska Federal Health Care Access
Network) project and it has the potential to really improve
telecommunication and distance education in Alaska; however, it is
mostly destined for federal facilities and community health aides.
What is not linked right now is our public health nursing network
and the distance learning project. The offerings available from
public health personnel, all of their specialties, is enormous. He
believes that the distance learning coordinator will be very busy
identifying and distributing the training.
SENATOR PEARCE stated, "The distance learning coordinator and the
three microcomputer technicians are going to be working on
something that's entirely ... outside of this particular grant and
just bioterrorism and computers that are -- a system that's being
built with money somewhere else that you don't talk about in here."
Number 1920
MS. CLARKE indicated, "Public health nurses are one of the last
groups to come into the networking age and we do not have our
public health nursing centers networked, and so this will allow us
to do that for public health nursing, as well as, putting the
support to keep that network going. So, you are correct. We are
able to use this federal grant to do something that we believe we
need to do anyway. So, that's where we say that the health alert
network doesn't exist; this will help connect this network with
other networks that clearly, as you point out, do exist."
Number 1956
REPRESENTATIVE BUNDE expressed concern, similar to the previous
RPL, about the fact that this grant will cause the state workforce
to grow by three people. He asked if this will be "soft money" and
is there any assurance from the DHSS that in the third or fourth
year if the grant is not forthcoming that the individuals will go
away.
MS. CLARKE responded, "Absolutely." She explained that the
Division of Public Health has significant "soft money" and they've
had to lose specialists when a federal grant has gone away. It is
a typical way that they've funded public health. She expressed
concern with having the full legislature review the new proposal,
which she feels is a good one. The grant was awarded in August and
there are some requirements to spend the dollars in a timely
manner; therefore, if they wait until July 1 they could not spend
the money as the federal agency has required and it might
jeopardize the second, third and fourth year. That is why the RPL
is being re-submitted to the committee.
REPRESENTATIVE BUNDE indicated that he understands the time crunch,
but that there does seem to be some duplication between the federal
agencies and the state. He wants to be sure this grant is
something that is absolutely necessary and it isn't just that the
state wants the same toys as the federal government. He asked if
bioterrorism is referring to domestic terrorism or foreign
terrorism, because foreign terrorism seems to be a federal
responsibility.
MR. ANDERSON stated that the threats were carefully considered
during the grant writing process. Unfortunately in most of these
events the source is uncertain, whether it's domestic or foreign.
During a response that information is not critical, because either
way the response is conducted in the same way. He explained that
one of the things they took great pains to do was survey the
resources that currently exist in Alaska. At the time of the grant
the raid team did not exist. He indicated that the DHSS is
scheduled to meet with representatives from that team next week.
He said that he could assure the committee to date that the process
that has been used was entirely geared toward insuring the support
and enhancement of existing capabilities and not duplicate,
although there may be minor overlap between federal agencies and
the state, but that may be healthy.
REPRESENTATIVE BUNDE stated, "I to would add my voice to hearing
about how this will be coordinated with what is really another
state agency, the National Guard, and I appreciate you having an
awareness and concern about duplication."
CHAIR PHILLIPS indicated that a meeting would be scheduled.
REPRESENTATIVE CROFT said, "It seems to me you're facing the
criticism that this is a whole new program or it's not really a
whole new program, and if it's a whole new program people have
concerns that they don't want to start a whole new program and if
it's not than it's just a subterfuge to do what you were doing
before. I don't think it's all of one or the other. I mean I
think it is a new initiative that's going to leverage some existing
things. It's been interesting watching you getting grilled on both
ends that, 'this is entirely new, isn't it,' and, 'this isn't
entirely new, isn't it,' but I do hope you will coordinate --
leverage whatever we have in terms of communication equipment or
networks and coordinate with whatever the federal government has."
Number 2165
REPRESENTATIVE THERRIAULT stated, "Just looking at the backup here
it says, 'it is expected that the general funds to maintain this
effort at the end of the grant period,' which is ... four or five
[years], 'will not be needed since the majority of the funding is
for development and equipment purchase, which will be completed by
the end of the grant period,' but if you've got specially trained
personnel is that a realistic statement that there won't be some
kind of ongoing need now. It maybe four years from now, but
there's going to have to be some personnel kept on."
MS. CLARKE indicated, "We'll have to assess that at the time and it
maybe that if we have some occurrences that this certainly becomes
more important than something else we're doing with state general
funds, but right now this is 'soft money' and that's how we're
approaching it."
Number 2210
CHAIR PHILLIPS asked if there was any opposition to the approval of
RPL 06-0-0180/HSS/HSS Public Preparedness for Bioterrorism. There
being none the RPL was approved.
EXECUTIVE SESSION
Number 2216
SENATOR PHILLIPS made a motion to move to executive session for the
purpose of discussing the audits. There being no objection, the
committee went into executive session at 9:10 a.m.
[Chair Phillips asked the Legislative Finance Division staff,
Legislative Audit Division staff, Tom Maher and Pat Hartley
(Legislative Budget and Audit Committee aide) to attend the
executive session]
CHAIR PHILLIPS made a motion to resume open session. There being
no objection, the committee resumed open session at 9:40 a.m.
AUDIT REPORTS
Number 2235
SENATOR PHILLIPS made a motion to release the following audits: the
Department of Administration, Alaska Oil and Gas Conservation
Commission, and Department of Community and Economic Development,
Regulatory Commission of Alaska; the Department of Administration,
Division of Alaska Longevity Programs, Alaska Pioneer's Home; the
Department of Transportation and Public Facilities, Central Region,
Homer Gravel Roads Project. There being no objection, those three
audits were released to the public. He noted that the Alaska
Housing Finance Audit is not up for release and reminded members
that it is still a preliminary audit at this time.
SENATOR PHILLIPS made a motion to release the preliminary audits
for departmental review ... . There being no objection, those
audits were released to the agencies for review.
TAPE 00-1, SIDE B
[Tape malfunction -- was not recording until 0055]
Number 0055
PAT DAVIDSON, Legislative Auditor, Legislative Audit Division,
Alaska State Legislature, "-- need to follow up as needed on any of
the issues and concerns raised in the consultants report on a broad
based outside just the Mat-Su [Matanuska - Susitna] Youth Facility.
Alternatively, the committee may wish to hold any action and wait
for the consultants report, which may be out within the next month,
month and a half, take a look at what those findings and concerns
are and than develop or any individual member develop an audit
request as it relates to DOT."
Number 0148
SENATOR PHILLIPS made a motion to approve the recommendation by Pat
Davidson, "I believe that the Division of Legislative Audit should
review the costs and benefits utilizing DOT's staff managed
facilities construction projects compared to the private
construction management. Additionally, the division should follow
up as needed on any issues and concerns raised by the consultants
of review of the Matsu-Su Youth Facility Project." There being no
objection, the recommendation was approved.
REPORT FROM THE DENALI COMMISSION
Number 0238
KRAG JOHNSON, Legislative Coordinator for the Denali Commission,
stated,
The commission was introduced by Senator Stevens and
approved by Congress in 1998. It's an innovative
federal/state partnership to solve critical problems in
Alaska. The many reports and stories that come out about
the Denali Commission's funding, and so to review the
facts, the original FY [Fiscal Year] 99 appropriation for
the commission was $20 million and the funding for the
current fiscal year, fiscal year 2000, is at $20 million
and the commission has submitted a work plan to the
Secretary of Commerce for next years budget that is
requesting $45 million for fiscal year '01.
To recap, real quickly, the FY99 funded project's list is
included in the packet. Primarily the commission
followed the adopted theme of rural energy. Over
three-quarters of the budget was funded for bulk fuel
storage facilities and energy upgrades. And the
commission's intent is to start with basic
infrastructure, like the bulk fuel storage facilities and
energy upgrades, and then expand from this point. So,
the selection of the projects for FY99 followed the
Department of Community and Regional Affairs, Division of
Energy's listing, which is now the Alaska Energy
Authority and that was the priority listing for selection
of communities. It's estimated the need for bulk fuel
storage facilities in Alaska is approximately $450
million and list is included.
Moving onto the current fiscal year, the commission will
be deciding funding allocations for the fiscal year 2000
at a January 21 meeting here in Juneau next Friday, and
the commission has decided to continue with the rural
energy theme, which means approximately 75 percent of
this year's budget will go to further bulk fuel storage
facilities and energy upgrades. And once again the
commission will follow the bulk fuel storage facility and
energy upgrade listing from the Alaska Energy Authority.
I can mention the commission's requesting $45 million for
Congress for FY01. A copy of the actual work plan that
was submitted to the Secretary of Commerce is in the
packet and the commission will continue once again with
the rural energy theme, but also is discussing adopting
additional themes for FY01 and a few of those that are
being discussed are rural health clinics and multi-use
facilities. A complete copy of that work is in the
packet.
Also, recent news about the Trans-Alaska Pipeline
liability funds and so to kind-of briefly go over that
the state, and presumably DEC, would be receiving $18
million from this Trans-Alaska Pipeline liability fund
settlement for bulk fuel tank remediation in Alaska. And
the $6.2 million was designated to the permanent fund by
law and the Denali Commission will, in the future, be
receiving an annual appropriation from the interest of
the this account that's estimated to be $8.5 million and
this will be a continuous annual appropriation.
So, to give you an idea of the economic engine that could
-- the economic engine the commission could become if we
had this funding source from the Trans-Alaska Pipeline
account and the end of next year and the beginning of the
next fiscal year and the request of $45 million for FY01,
it's possible the commission would have approximately $62
million available in FY01. We also included, in your
packets, a copy of the first draft of a statewide energy
plan. The commission partnered with the USDA [United
States Department of Agriculture] rural development and
AIDEA [Alaska Industrial Development and Export
Authority] to put together a statewide energy plan. The
goal is to provide some consistent policies and
coordinated efforts with the agencies that are funding
Alaska enery projects and a copy of the first phase of
this plan is included in the packet. And phase two of
the plan is slated to be completed by the October 2000.
Work force development and economic development are two
areas the commission also has been charged with. It
could be the most important work of the commission, but
is also the most difficult to make an impact. At the
upcoming meeting next week a training strategy and an
economic development strategy will be before the
commission for further discussion and both copies of
those strategies are in the January 21 backup material.
Number 0625
JEFF STASER, Co-Chairman, Denali Commission, indicated that they
are not before the committee to ask for money; they are there to
explain who they are, what they are doing and how they do it. They
think of themselves as a partnership between the federal government
and the people of the state; the federal government is the venture
capitalist willing to invest in the state and the people of the
state make the decisions on how to spend the money. He said that
the co-chair on the commission is the Governor and there are five
statewide organizations. He sees the legislators as stock-holders
and investors. He urged that the commission cannot succeed without
the partnership of everbody in Alaska. As a federal agency the
U.S. Congress is basically acting like the board of directors; they
are investing state elected federal tax dollars from around the
country in Alaska and every state has the right to ask the
commission how and why they are spending their money in Alaska.
The commission's message is to demonstrate to them that they are
not doing things that could otherwise be done by anybody else in
the state; that these are appropriate things for the federal
government to be participating in. Alaska, with 600,000 people,
has a disproportionate share of influence over federal spending.
He said that Alaskans should be proud of what they can do and have
been doing with the help from the federal government. The start of
the commission, back in April, when they established themselves as
a federal agency was with their own budgeting. They formed
interagency staff with highly skilled professionals that were being
detailed from other organizations to their staff. The federal
agencies recognize this as an avenue to go around some of their
problems and to participate in creative solutions for all of
Alaska. He pointed out that they have three years worth of federal
budgeting done in the last nine months. They not only did their
part in presenting to the federal community their needs and the
justification of what they are doing, but they have been persuasive
as a team. They have persuaded the President of the United States
to budget for the Denali Commission.
Number 0868
REPRESENTATIVE BUNDE wondered what is involved in state funds.
MR. STASER indicated that the Denali Commission is to go where
there are gaps; where the state cannot get to a problem. They
look, as part of their criteria, for cost-sharing. They figure
that if local communities in the state are not willing to invest in
a project, why should the commission invest. He noted that
currently they do not require matching funds from the state. If it
is a project that is being cost-shared then it should be given
higher priority.
REPRESENTATIVE MULDER wondered how many general funds are in the
commission's budget and if there are federal requirements for how
much money can be spent on staffing.
MR. STASER responded, "Absolutely." He said that in the law there
is a 5 percent cap of what can be spent on overhead. With all of
the start-up costs and staffing issues over the last year with the
first $20 million overhead was less than 3 percent.
REPRESENTATIVE BUNDE wondered what was meant by "multi-use
facilities."
MR. STASER explained that there are some great examples of how the
federal government designs a program based on national assessments
of need that leave gaps. The federal government doesn't understand
the uniqueness of Alaska, so they ask if the commission needs bulk
fuel tanks or multi-use facilities, which the commission is
thankful of, even though the commission hasn't carved out a place
for them yet. He pointed out that if they can get economies of
scale and efficiencies by consolidating programs then let's do it.
He indicated that they have federal agencies coming to them saying,
"let's enter into an MOU (memorandum of understanding), extend your
authorities to our program and we can get more bang for the federal
buck."
REPRESENTATIVE BUNDE wondered if the money is a federal
appropriation or money that gets filtered through the state budget.
Number 1152
MR. STASER explained that the commission put in a work plan, which
contained the requests they thought they needed and why. The
Congress puts together a budget, which is signed into law by the
President. The money goes to the OMB (Office of Management and
Budget) at the federal level and they allocate it out to the
agencies.
REPRESENTATIVE BUNDE clarified that the money does not expand
Alaska's total budget.
REPRESENTATIVE DAVIS wondered who is responsible for the
multi-purpose building five years from now when it needs to be
repaired.
MR. STASER indicated that at this point it is difficult to comment
on how the multi-purpose area will be structure. This is an issue
that the commission is wrestling with. The principles that they
have outlined in their criteria are what are the long-term
operations in maintenance and how can it be a self-sufficient
enabling type of utility. The priority will go where the needs
are, but there also needs to be flexibility. The issues of
operations and maintenance are critical to the selection process.
The commission is being instructed by the communities on what they
need and how they are going to maintain it.
Number 1394
REPRESENTATIVE THERRIAULT described his experience with visiting a
facility in a community that was well maintained; somebody in the
community was responsible for maintaining the facility and there
was no vandalism. He also described a different scenario where the
facility had holes punched through the walls and the machinery was
in disrepair; there was no one in the community that wanted to take
on the responsibility of the facility. He pointed out that there
is a level of sophistication that makes all the difference.
MR. STASER stated that sovereignty is something that is within us.
He indicated that he has a high level of confidence in the people
of Alaska. There has been an explosion in the population in rural
parts of the Alaska and it puts a strain on the utilities and
infrastructure, but there is also a generation that has learned how
to use the federal government effectively.
REPRESENTATIVE BUNDE said that he hopes the commission sticks to
that, because he has seen too many times people waiting for someone
to write a grant rather than picking up a shovel and starting the
project.
MR. STASER explained that they need to be guided by the Alaska
legislature and other members of the state to fill the gaps and to
get the federal government to do the right thing. It takes team
work.
Number 1628
SENATOR HALFORD pointed out that Alaska has a history in some
communities where the pipe from the sewer and water system that
failed from the 1980s is sitting next to the pipe that failed from
the 1990s. In these communities the highest ground is between
three and four feet above sea level; therefore, the sewer system,
which is water born and gravity-based is never going to work in
some of those locations. He hopes some money gets put into
alternative methods of dealing with sewer systems in those areas.
MR. STASER indicated that the commission is working with the Alaska
Science Technology Foundation. He said that the commission is not
interested in doing a lot of research, but if some good ideas are
generated by the Alaska Science Technology Foundation and the
Alaska legislature, then the commission would be willing to get
them out to the communities.
SENATOR PHILLIPS wondered if the commission is doing the same
things in the area of alternative energy.
MR. STASER replied, "Yes." He indicated that as the commission
grows and expands they are going to look at all the alternative
ways.
OTHER COMMITTEE BUSINESS
There was no other business discussed at the meeting.
ADJOURNMENT
Number 1824
CHAIR PHILLIPS adjourned the Joint Committee on Legislative Budget
and Audit at 10:20 a.m.
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