Legislature(2023 - 2024)SENATE FINANCE 532
01/24/2023 05:00 PM House LEGISLATIVE BUDGET & AUDIT
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| Audio | Topic |
|---|---|
| Start | |
| Election of Chair and Vice Chair | |
| Overview of Committee Process | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
LEGISLATIVE BUDGET AND AUDIT COMMITTEE
January 24, 2023
5:00 p.m.
MEMBERS PRESENT
Representative Ben Carpenter, Chair
Senator Bert Stedman, Vice Chair
Representative DeLena Johnson
Representative Sarah Vance
Representative Frank Tomaszewski
Representative Andy Josephson
Senator Bill Wielechowski
Senator James Kaufman
Senator Scott Kawasaki
MEMBERS ABSENT
Senator Lyman Hoffman
Senator Click Bishop (alternate)
OTHER LEGISLATORS PRESENT
Representative Mike Cronk
COMMITTEE CALENDAR
ELECTION OF CHAIR AND VICE CHAIR
OVERVIEW OF COMMITTEE PROCESS
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
KRIS CURTIS, Legislative Auditor
Legislative Audit Division
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided information on the role of the
Legislative Audit Division.
ALEXEI PAINTER, Legislative Fiscal Analyst
Legislative Finance Division
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided information on the role of the
Legislative Finance Division.
ACTION NARRATIVE
5:00:46 PM
SENATOR STEDMAN called the Legislative Budget and Audit
Committee meeting to order at 5:00 p.m. Senators Stedman,
Wielechowski, Kawasaki, and Bishop (alternate), and
Representatives Carpenter, Vance, Tomaszewski, and Josephson
were present at the call to order. Senator Kaufman and
Representative Johnson arrived as the meeting was in progress.
^Election of Chair and Vice Chair
Election of Chair and Vice Chair
5:01:36 PM
SENATOR STEDMAN announced that the first order of business would
be nominations for the chair and vice chair of the Legislative
Budget and Audit Committee.
REPRESENTATIVE VANCE nominated Representative Ben Carpenter as
chair of the Legislative Budget and Audit Committee for the
Thirty-Third Alaska State Legislature, and she asked that
nominations be closed. There being no objection, it was so
ordered.
5:02:07 PM
The committee took a brief at-ease.
5:02:20 PM
CHAIR CARPENTER opened nominations for the vice chair.
REPRESENTATIVE TOMASZEWSKI nominated Senator Bert Stedman as
vice chair of the Legislative Budget and Audit Committee for the
Thirty-Third Alaska State Legislature, and he asked that
nominations be closed. There being no objection, it was so
ordered.
^Overview of Committee Process
Overview of Committee Process
5:03:10 PM
CHAIR CARPENTER announced that the next order of business would
be an overview of the Legislative Budget and Audit Committee's
function and processes.
CHAIR CARPENTER offered opening comments, introduced the
committee secretary and the Legislative Information Offices
(LIO) moderator, and noted that the committee was governed by
statute, as opposed to the Uniform Rules. He introduced the
Legislative Budget and Audit Committee Handbook [hard copy
included in the committee packet], which detailed the
authorizing statutes for the committee, and he highlighted key
differences about this specific committee.
5:04:55 PM
The committee took a brief at-ease.
5:05:04 PM
CHAIR CARPENTER invited Kris Curtis, Legislative Auditor, to
explain the interaction between the Legislative Audit Division
and the committee.
5:05:27 PM
KRIS CURTIS, Legislative Auditor, Legislative Audit Division,
Alaska State Legislature, introduced herself and her staff,
noting that she had been with the division for almost 30 years
and in her current role for 11 years. She directed attention to
the Legislative Budget and Audit Committee Handbook and
highlighted its inclusion of the authorizing statutes for the
committee and the two permanent staff agencies, identified as
the Legislative Audit Division and the Legislative Finance
Division. Additionally, the handbook included the committee's
formal policies and procedures, which guide the conduct of
business. She cited page 39 of the handbook, which listed the
formal rules, as well as the dates of adoption. She expressed
her belief that the more significant areas included the approval
and release of the audit reports and approval of the audit
requests, as well as contracts and reimbursement for travel.
5:07:27 PM
MS. CURTIS discussed the confidential report release procedures
outlined on page 47 of the handbook. She emphasized that
statute made the audit and performance review process
confidential and that it was important for committee members and
staff to take the necessary precautions to protect against the
premature release of these documents. She proclaimed that the
reports should not be copied or distributed for any purpose.
She explained that the reports were first brought to the
committee as a preliminary report and distributed for discussion
during the executive session. At this time, she would review
the recommendations and conclusions presented in the report.
When the committee comes out of executive session, a motion to
release the report to the agency under review would be voted on.
If released, the agency would be asked to formally respond to
the report. These formal comments would be forwarded to Ms.
Curtis for review and would remain confidential. She continued
to explain that she would add these comments to the preliminary
report and return it to the committee as a final report at least
two days prior to the Legislative Budget and Audit Committee
meeting. These reports, she said, would be delivered in a
sealed envelope, marked "confidential," and printed on blue
paper to distinguish this confidential document from others.
The report would then be discussed during an executive session
and, after exiting executive session, a vote would be taken to
release the report as a final public document.
5:10:11 PM
MS. CURTIS reported on the status of audit work. She directed
attention to the matrix of current audits, titled "DLA Audit
Status January 23," [hard copy included in the committee
packet]. She relayed that there were six performance audits,
five sunset audits, and one statewide financial audit. She
noted that the "Office of Children's Services Compliance with
Foster Care Reform Parts 2 and 3" was the oldest of the six
audit requests and was put on hold until after the pandemic at
the committee's request. She reported that the audit work on
"Spending on Janus Contracts" had been completed, adding that
she expected to bring the preliminary audit report before the
committee before the end of session. She shared that the "Oil
and Gas Production Tax Audit Process" would be started in the
spring or summer [2023]. She went on to list the "Technical
Vocational Education Program," noting that the TVEP program was
up for sunset in 2024. The "Alaska Information Technology
Systems" audit was a security audit, she said, that directed Ms.
Curtis to procure the services of Internet technology (IT)
security experts to help review the state security systems. She
conveyed that four of the five sunset audits were required to be
completed by statute and released as documents before the next
session starts [in January 2024]. She explained that the sunset
follow-up to extend the Board of Chiropractic Examiners included
uncodified law that directed the Legislative Audit Division to
provide a status of the recommendations to the committee before
June 30, 2023. Finally, the opinion on the Annual Comprehensive
Financial Report (ACFR) financial audit was statutorily required
to be available by December 15 [2022]. She acknowledged that it
was late, adding that she hoped to get the opinion out by mid-
January [2023] pending the completion of outside audits, which
had not yet been received.
5:13:41 PM
CHAIR CARPENTER questioned whether the ACFR financial audit
could be provided to the committee exclusive of the outside
audits. He suggested that the pending outside audits could be
supplemented upon completion.
MS. CURTIS indicated that the ACFR was reliant upon that which
was missing. She noted that one of the missing pieces was
significant to the audit.
5:14:18 PM
CHAIR CARPENTER invited Alexei Painter, Legislative Fiscal
Analyst, to explain the interaction between the Legislative
Finance Division and the committee.
5:14:45 PM
ALEXEI PAINTER, Legislative Fiscal Analyst, Legislative Finance
Division, Alaska State Legislature, introduced himself as the
director of the division and described the division as "the
finance division proper." He shared that the division's primary
interaction with the committee would be for Revised Programs
Legislative (RPLs), which he described as requests by the
executive branch for additional authorization to spend money.
He relayed that the Office of Management & Budget (OMB) would
submit the RPLs, and that the Legislative Finance Division would
review those requests and send them to the committee. He
pointed out that even if the committee were to vote down an RPL,
the governor may withdraw it or implement it after 45 days. He
emphasized that the RPL process was fundamentally advisory, as
it would be unconstitutional for the committee to have the power
of appropriation. He noted that, per the statutes governing the
Legislative Finance Division, the division could take on special
projects at the direction of the committee. He invited
questions from the committee members.
5:17:32 PM
REPRESENTATIVE JOSEPHSON asked whether the 45-day timeline was
operative for RPLs that had been rejected in December.
MR. PAINTER answered yes, the 45-day timeline began on the day
of submission to the legislature.
REPRESENTATIVE JOSEPHSON commented on Mr. Painter's
characterization of the Legislative Budget and Audit Committee
as "advisory." He sought to confirm that the question of
identifying the appropriator was unresolved in some contexts.
MR. PAINTER said the law provided that money may be appropriated
conditionally to the Legislative Budget and Audit Committee
process. He stated that the power of appropriation remained
with the full body that appropriated the additional amounts
contingent on the process. He added that the statutory process
did not provide the committee with the authority to stop RPLs,
as the delegation of that power could not be granted to a
committee.
REPRESENTATIVE JOSEPHSON pointed out that the governor could
effectively appropriate money during the interim with the RPL
process. He asked whether that was a fair analysis.
MR. PAINTER emphasized that, in contrast to making new
appropriations, the governor was increasing existing
appropriations in accordance with the appropriation in the bill
that allowed him to do so.
5:20:15 PM
MR. PAINTER, in response to a question from Senator Stedman,
explained that according to statute, an RPL was appropriate for
an unanticipated increase in federal revenue. He reiterated
that it must be unexpected revenue that was not anticipated
during the budget process. He noted that the legislature could
place additional restrictions on the RPL process though the
appropriation language.
5:21:44 PM
SENATOR WIELECHOWSKI asked whether the [Alaska] Supreme Court
had ruled on the legality of the RPL process. He characterized
the process as "questionable."
MR. PAINTER shared his understanding that the courts had not
ruled on the RPL process.
CHAIR CARPENTER offered closing remarks and thanked Ms. Curtis
and Mr. Painter for their presentations.
5:22:27 PM
ADJOURNMENT
There being no further business before the committee, the
Legislative Budget and Audit Committee meeting was adjourned at
5:22 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 2023 LBAC Handbook DRAFT.pdf |
JBUD 1/24/2023 5:00:00 PM |
|
| DLA Audit Status January 23.pdf |
JBUD 1/24/2023 5:00:00 PM |