Legislature(1995 - 1996)
02/03/1996 01:09 PM House CRA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE COMMUNITY AND REGIONAL AFFAIRS
STANDING COMMITTEE
February 3, 1996
1:09 p.m.
MEMBERS PRESENT
Representative Ivan Ivan, Co-Chair
Representative Alan Austerman, Co-Chair
Representative Kim Elton
Representative Al Vezey
Representative Irene Nicholia
MEMBERS ABSENT
Representative Jerry Mackie
Representative Pete Kott
COMMITTEE CALENDAR
HOUSE BILL NO. 409
"An Act combining parts of the Department of Commerce and Economic
Development and parts of the Department of Community and Regional
Affairs by transferring some of their duties to a new Department of
Community and Economic Development; transferring some of the duties
of the Department of Commerce and Economic Development and the
Department of Community and Regional Affairs to other existing
agencies; eliminating the Department of Commerce and Economic
Development and the Department of Community and Regional Affairs;
adjusting the membership of certain multi-member bodies to reflect
the transfer of duties among departments and the elimination of
departments; and providing for an effective date."
- HEARD AND HELD
PREVIOUS ACTION
BILL: HB 409
SHORT TITLE: DEPT OF COMMUNITY & ECONOMIC DEVELOPMENT
SPONSOR(S): REPRESENTATIVE(S) KELLY, Therriault, James, Kohring
JRN-DATE JRN-DATE ACTION
01/11/96 2409 (H) READ THE FIRST TIME - REFERRAL(S)
01/11/96 2409 (H) CRA, FINANCE
01/16/96 2456 (H) COSPONSOR(S): KOHRING
02/01/96 (H) CRA AT 01:00 PM CAPITOL 124
02/01/96 (H) MINUTES(CRA)
02/03/96 (H) CRA AT 01:00 PM CAPITOL 124
WITNESS REGISTER
PETE KELLY, Representative
Alaska State Legislature
State Capitol Building, Room 513
Juneau, Alaska 99801
Telephone: (907) 465-2327
POSITION STATEMENT: As sponsor, answered questions on HB 409.
DIANE DUVALL, Treasurer
KIDPAC
8840 Gloralee Street
Anchorage, AK 99502
Telephone: (907) 279-5025
POSITION STATEMENT: Opposed HB 409 as written.
CARL BERGER, Executive Director
Lower Kuskokwim Economic Development Council
P.O. Box 2021
Bethel, Alaska 99559
Telephone: (907) 543-2031
POSITION STATEMENT: Supported HB 409, with suggestions.
PATTY MERITT
Play and Learn Nonprofit Child Care Center
4581 Drake Street
Fairbanks, Alaska 99709
Telephone: (907) 474-0841
POSITION STATEMENT: Testified on HB 409.
MIKE SCOTT, Manager
City of Kotzebue
P.O. Box 46
Kotzebue, Alaska 99752
Telephone: (907) 442-3401
POSITION STATEMENT: Testified on HB 409.
KARIN McCULLOUGH
P.O. Box 707
Petersburg, Alaska 99833
Telephone: (907) 772-9238
POSITION STATEMENT: Opposed HB 409.
MARGARET T. BEETUS, Mayor
City of Hughes
P.O. Box 45010
Hughes, Alaska 99745-0010
Telephone: (907) 889-2206
POSITION STATEMENT: Opposed HB 409.
ANDY DURNY, Treasurer
City of Nulato
P.O. Box 65009
Nulato, Alaska 99765
Telephone: (907) 898-2205
POSITION STATEMENT: Agreed with intent of HB 409 but had concerns.
STEVE ANDISON, General Manager
Kake Nonprofit Fisheries Corporation
City of Kake
P.O. Box 500
Kake, Alaska 99830
Telephone: (907) 785-3804
POSITION STATEMENT: Testified on HB 409.
BETH EDMANDS, Executive Director
Child Care Connection
2218 Alder Drive
Anchorage, Alaska 99508
Telephone: (907) 258-1185
POSITION STATEMENT: Opposed to HB 409 as written.
ALLEN JOSEPH, Director
Tribal and Program Support Services
Yukon Kuskokwim Health Corporation
P.O. Box 528
Bethel, Alaska 99559
Telephone: (907) 543-3336
POSITION STATEMENT: Opposed to HB 409.
CHERYL KEEPERS, Manager
Child Care Assistance Program
Fairbanks North Star Borough
P.O. Box 71267
Fairbanks, Alaska 99707
Telephone: (907) 459-1474
POSITION STATEMENT: Voiced concerns about HB 409.
MARGARET HANSEN, Local Government Specialist
Kotzebue Regional Office
Division of Municipal and Regional Assistance
Department of Community and Regional Affairs
P.O. Box 350
Kotzebue, Alaska 99752-0350
Telephone: (907) 442-2404
POSITION STATEMENT: Opposed HB 409.
TERRY HINDMAN
P.O. Box 1431
Petersburg, Alaska 99833
Telephone: (907) 772-4418
POSITION STATEMENT: Voiced concerns about HB 409.
CHARLES McKEE
P.O. Box 243053
Anchorage, Alaska 99524
(No telephone number provided)
POSITION STATEMENT: Opposed HB 409.
SCOTT CALDER
P.O. Box 75011
Fairbanks, Alaska 99707
Telephone: (907) 474-0174
POSITION STATEMENT: Testified on HB 409.
JOHN ANGAIAK
P.O. Box 528
Bethel, Alaska 99559
Telephone: (907) 543-6033
POSITION STATEMENT: Testified on HB 409.
EILEEN NEWMAN
Tanana Chiefs Conference, Inc.
122 First Avenue
Fairbanks, Alaska 99701
Telephone: (907) 452-8251
POSITION STATEMENT: Opposed HB 409.
KAREN KING
Alaska Head Start Directors Association
P.O. Box 200986
Anchorage, Alaska 99520
Telephone: (907) 277-9759
POSITION STATEMENT: Testified on HB 409.
JODI DELANEY
3200 Kris Kringle Drive
North Pole, Alaska 99705
Telephone: (907) 488-0334
POSITION STATEMENT: Testified on HB 409.
VIRGINIA WASHINGTON, Administrator
City of St. Michael
P.O. Box 70
St. Michael, Alaska 99659
Telephone: (907) 923-3222
POSITION STATEMENT: Voiced concerns about HB 409.
LINDA HALL, Commercial Insurance Broker
Alaska Independent Insurance Agents
and Brokers
3111 C Street, Suite 300
Anchorage, Alaska 99503
Telephone: (907) 561-1250
POSITION STATEMENT: Testified on HB 409.
LARE
1805 Bunker
Anchorage, Alaska 99503
Telephone: (907) 274-7793
POSITION STATEMENT: Testified on HB 409.
JOHN WHEATLEY, CEO
Willis Corroon Corporation of Anchorage
7740 McLure
Anchorage, Alaska 99516
Telephone: (907) 562-2266
POSITION STATEMENT: Testified on HB 409.
JEANINE KENNEDY, Executive Director
Rural Alaska Community Action Program
(RurAL CAP)
P.O. Box 200908
Anchorage, Alaska 99520
Telephone: (907) 279-2511
POSITION STATEMENT: Testified on HB 409.
PAUL FUHS, Lobbyist
Alaska ARDOR Association
10652 Porter Lane
Juneau, Alaska 99801
Telephone: (907) 790-3030
POSITION STATEMENT: Supported concept of HB 409.
PATRICIA J. STANLEY, Executive Director
Council of Athabascan Tribal Governments
P.O. Box 33
Fort Yukon, Alaska 99740
Telephone: (907) 662-2587
POSITION STATEMENT: Testified on HB 409.
ACTION NARRATIVE
TAPE 96-7, SIDE A
Number 0001
CO-CHAIR IVAN IVAN called the House Community and Regional Affairs
Committee meeting to order at 1:09 p.m. Members present at the
call to order were Representatives Ivan, Austerman, Elton and
Vezey. Members absent were Representatives Mackie, Kott and
Nicholia.
HB 409 - DEPT OF COMMUNITY & ECONOMIC DEVELOPMENT
Number 0139
CO-CHAIR IVAN reminded people testifying via teleconference that
they could fax copies of written testimony to (907) 465-4589 for
inclusion in the record. He called upon the sponsor of HB 409,
Representative Pete Kelly, to provide a brief recap of the bill.
Number 0193
REPRESENTATIVE PETE KELLY explained that HB 409 attempted to
combine the economic development functions of the Department of
Community and Regional Affairs (DCRA) and the Department of
Commerce and Economic Development (DCED). It also attempted to
peel off from DCRA and DCED some of the functions and programs that
did not match the mission statements of those departments. Those
functions and programs would be reassigned to other departments.
Number 0254
REPRESENTATIVE KELLY said economic development should be the
primary focus of the legislature and the Administration. The
previous year, the legislature had been forced to make cuts in both
DCRA and DCED, mainly in administrative services. This year,
additional cuts were required, again primarily in administrative
services. However, there was concern that cutting too deep, even
in administrative services, would begin to affect vital services to
the people of Alaska. By combining the efforts of economic
development, those services could be made more accessible and be
carried out in a better fashion. Representative Kelly emphasized
that HB 409 would cut no services; it attempted to combine
administrative functions to better carry out services and was
created to protect them. He added that users of economic
development services had expressed frustration in having to go back
and forth between agencies. He suggested setting up an 800 number
to facilitate one-stop shopping for economic development services.
Number 0499
CO-CHAIR IVAN thanked Representative Kelly and recognized that
Representative Nicholia had joined the meeting.
Number 0557
DIANE DUVALL, Treasurer, KIDPAC, testified via teleconference from
Anchorage. She spoke about the importance of coordinating policy
and programs for young children in Alaska. She advocated the
consolidation of child care, Head Start and other programs relating
to special-needs and disadvantaged children. She explained that HB
409 separated preschool children into two groups, Head Start and
child care, dividing families' lives. She suggested bringing
together representatives from the child care industry and Head
Start to consolidate and focus state agencies dealing with children
into one division. She expressed enthusiasm for the idea of better
aligning the missions and goals of the agencies. But HB 409, she
said, was divisive and not what they were looking for.
Number 0847
CARL BERGER, Executive Director, Lower Kuskokwim Economic
Development Council, testified via teleconference from Bethel. He
explained that the council was an Alaska Regional Development
Organization (ARDOR). He spoke on behalf of HB 409, particularly
with regard to economic development. He noted that 27 villages
were part of his council, a grass-roots organization supported by
private and some state funding. Mr. Berger wanted to see efforts
towards consolidating economic development services and their
accessibility, particularly in rural areas. In some cases, he
said, there had been a scatter-shot approach from federal, state
and private agencies to providing these services. He said HB 409
was a step in the right direction toward creating a single point of
contact.
Number 0966
MR. BERGER added that an ARDOR program, such as his, already acted
as a single point of contact in his region. He noted that the
council was interested in contracting for state services.
Number 1060
PATTY MERITT, Play and Learn Nonprofit Child Care Center, testified
via teleconference from Fairbanks. She referred to the two pages
of testimony she was submitting in writing and emphasized that the
agencies for Head Start and child care needed to stay together.
She felt that neither Head Start nor child care should be placed in
the Department of Health and Social Services (DHSS) or the
Department of Education (DOE). In particular, she said, child care
needed to be viewed as an economic tool. If it were placed in DOE
or DHSS, it would be viewed as a social service or welfare program.
Admittedly, she said, more revenue needed to be put into child care
to ensure adequate care and education for young children, but that
revenue needed to come from the private sector. She asserted that
parents cannot pay more and the government cannot contribute what
is needed; the private sector that should provide it was the
employer. For employers to recognize this need, however, it must
be seen as an economic tool. And the department that could do
that, she said, would either be the proposed Department of
Community and Economic Development or perhaps the Department of
Labor.
Number 1189
MS. MERITT said in terms of matching the mission statement,
Representative Kelly would be well served to look at the intent
behind child care, which enabled parents to work, getting them off
the public rolls and into being contributing citizens. She offered
to meet with committee members on Monday, February 4, in Juneau.
Number 1270
MIKE SCOTT, Manager, City of Kotzebue, testified via
teleconference. He believed DCRA and DCED should be left as is.
But if the state wanted to help rural areas with economic
development, he said, they should concentrate on coordination and
proposals to actually spur economic development, especially in
areas where transportation and energy were difficult to provide.
He did not believe HB 409 was the way to accomplish it. It would
be more productive, he felt, to set up programs to create jobs and
industrial development activity. Although he found the effort
behind HB 409 commendable, he thought it unwieldy and impractical.
CO-CHAIR IVAN recognized that Representative Carl Moses was present
and invited him to join the discussion if he wished.
Number 1380
KARIN McCULLOUGH testified via teleconference from Petersburg in
opposition to HB 409. She expressed concern about children and
their families; she recognized the need for long-term strategic
planning in state government with input from parents actually using
the services. She said the state's approach to child care affected
how parents approached their work life.
Number 1480
MARGARET T. BEETUS, Mayor, City of Hughes, testified via
teleconference. She said she totally opposed HB 409. She was
adamant that many families in Hughes would be "hugely affected" by
the proposed merger. She did not want to be the one who had to
explain to the people of her village why there was yet another
change.
Number 1664
REPRESENTATIVE KELLY asked if Ms. Beetus was aware HB 409 did not
propose to cut services.
MS. BEETUS responded that had been said in other instances, yet
they had to live with the consequences. "We don't believe what you
guys say anymore," she added.
Number 1680
REPRESENTATIVE KELLY reiterated that HB 409 did not cut services,
but attempted to protect them. He offered to send Ms. Beetus a
letter and perhaps give her a telephone call to discuss it.
MS. BEETUS again expressed skepticism about the merger. "If you're
going to merge two different departments, you guys come up here and
explain that to the people," she said. She emphasized she did not
want to take the blame.
Number 1730
ANDY DURNY, Treasurer, City of Nulato, testified via
teleconference. He said he agreed with the intent and goals of HB
409, but he had two concerns. First, he was concerned about
elimination of DCRA, which he felt, in his 14 years' experience, to
be the most responsible and helpful department with which they
dealt. Most other departments, he said, did not even know where
Nulato was located or what life was like there. Second, he was
concerned that efforts to streamline might create a work overload
instead.
Number 1808
STEVE ANDISON, General Manager, Kake Nonprofit Fisheries
Corporation, City of Kake, testified via teleconference. He
explained the City of Kake had been working with DCRA and DCED in
an effort to diversify their economy and add fishing back into the
economic mix along with logging. Mr. Andison expressed that the
two departments were distinctly different. He believed that DCRA
was better equipped to help rural communities and felt any attempt
to merge DCRA and DCED would weaken both departments. He advocated
leaving DCRA intact as a separate entity.
Number 2002
BETH EDMANDS, Executive Director, Child Care Connection, testified
via teleconference from Anchorage. She explained her own
background and that of Child Care Connection. She said she was
opposed to HB 409. While it addressed economic development, which
she favored, children's issues were merely an "aside" in the bill.
She offered to work with legislators to create a long-range plan
that did not separate children's services but brought them
together.
Number 2124
ALLEN JOSEPH, Director, Tribal and Program Support Services, Yukon
Kuskokwim Health Corporation, testified via teleconference from
Bethel in opposition to HB 409. He commented that he also spoke as
a concerned citizen. He said cuts had affected rural Alaska to the
point of smothering social and economic development. The services
found in DCRA were all that remained of the state's assistance to
rural Alaska. Mr. Joseph spoke against eliminating DCRA. If there
could be a compromise, he hoped DCRA would be made a division of
DCED. He feared rural and Head Start programs would lose priority
under the new scheme. He noted that he was a reviewer for DCRA's
Rural Development Assistance Grants; villages competed intensely
for $700,000 under that program. Mr. Joseph said the state's
efforts to eliminate DCRA was a slap to the villages. He added it
was not well thought out and was ignorant to the needs of rural
Alaskans.
Number 2240
CHERYL KEEPERS, Manager, Child Care Assistance Program, Fairbanks
North Star Borough, testified via teleconference about the impacts
of HB 409. She emphasized that DCRA's philosophical base was one
of community and economic development, which worked well for child
care programs. Child care assistance was not a welfare program,
she said, and did not belong in the Department of Health and Social
Services. She felt that if DCRA ceased to exist, child care
programs should be placed in a department where the foundation was
economic development. Finally, Ms. Keepers expressed concern about
the short notice on the hearing.
Number 2350
MARGARET HANSEN, Local Government Specialist, Kotzebue Regional
Office, Division of Municipal and Regional Assistance, Department
of Community and Regional Affairs, testified via teleconference
against HB 409. She felt the transfer of roles would hurt rural
communities and suggested combining DCED into DCRA instead, as DCRA
already had rural offices and staff who were born and raised in the
area.
Number 2422
TERRY HINDMAN testified via teleconference from Petersburg. She
voiced concerns about child care programs being transferred to the
Department of Health and Social Services. Several parents there
had expressed similar concerns, she said. She felt the issue
needed more time and additional hearings.
TAPE 96-7, SIDE B
Number 024
CHARLES McKEE testified via teleconference from Anchorage. He
referred to page 92 of HB 409 and said that 16 U.S.C. 1456, Section
307, the Coastal Zone Management Act of 1972, was the federal
application of what HB 409 was trying to accomplish. He adamantly
opposed the Coastal Zone Management Act; he also opposed HB 409
because it was simply trying to bring about the completion of that
act, he said. He cited an article written the winter of 1995 and
said, "I am economic development." He added he could not provide
economic development for himself or his community or anywhere else
"if you people do not comply with the law."
Number 0185
SCOTT CALDER testified via teleconference from Fairbanks. He
expressed interest in children's programs. He suggested the
committee listen to the concerns voiced earlier by the mayor of
Hughes, Margaret Beetus. He felt that children's programs should
conform to the expectations of parents of the particular children
involved; no programs should receive higher priority than the
community and economic interests of those parents. Mr. Calder
added that based on its track record, the Department of Health and
Social Services should have as little to do with Alaska's children
as possible.
Number 0269
MR. CALDER referred to AS 11.76.100(e), regarding persons convicted
of providing tobacco to minors, and discussed problems in a foster
home caring for his own son. He felt businesses should not be
"picked on" for violations, but that liability should be also
spread back to the Department of Health and Social Services, who
provided the money in the first place for minors to purchase
tobacco, for example. He also referred to AS 47.18.10(d),
regarding programs and services related to minors and noted that
parents were second on the list behind teens. Again, he said,
parents should not be on the list, but instead should be right at
the top of the process. Programs should be working for the parents
of the children, he added.
Number 0382
JOHN ANGAIAK testified via teleconference from Bethel, saying he
did not know whether HB 409 would be good for the rural areas. He
thought DCRA should be left alone. He referred to Rural
Development Assistance (RDA) grant applications and said that with
RDAs cut from $100,000 to $50,000, they did not provide enough
economic incentive to the rural villages, particularly in his area.
He foresaw consolidation having further detrimental impacts. Mr.
Angaiak gave examples of funding cuts and talked about tribal
councils not qualifying for certain grant programs. He reiterated
that $50,000 was not enough money for any project.
Number 0673
REPRESENTATIVE KELLY referred to Mr. Angaiak's mention of funding
level decreases and changing numbers of grant applicants. He asked
if Mr. Angaiak was aware that HB 409 did not in any way address
those issues as far as the level of funding.
Number 0693
MR. ANGAIAK responded that he was aware of that. However, he said,
the decrease to $50,000 was a significant change.
Number 0714
EILEEN NEWMAN, Tanana Chiefs Conference, Inc., testified via
teleconference from Fairbanks in opposition to HB 409. She read
from a two-page prepared statement that was then provided to the
committee. She was apprehensive of future cuts to rural Alaska and
felt it crucial that DCRA be kept intact. She expressed that
transferring the Revenue Sharing and Municipal Assistance Program
to the Department of Revenue, separating it from the Municipal and
Regional Assistance Program, would definitely mean a cut to
services to the villages. She opposed placing the Head Start
Program in the Department of Education and felt it required a more
holistic approach. She described the link that DCRA provided
between the villages and state government. She asked whether
eliminating whole departments was necessary to achieve efficiency
and whether other options had been evaluated.
Number 1007
KAREN KING, Alaska Head Start Directors Association, testified via
teleconference from Anchorage. She stated it was clear from
testimony that DCRA has a voice to rural Alaska. There appeared to
be an unacceptable chasm between rural and urban communities. She
asserted that HB 409 appeared to be an effort to widen that gap.
She asked if this was another attempt to make rural Alaskans leave
their native homeland and move to cities. She objected to placing
Head Start services under the Department of Education (DOE).
Participants in the Head Start community had not been solicited or
polled about the issue. She felt the changes were being done to
them rather than with them, and maybe in spite of them. She noted
that DCRA had been wonderfully supportive and responsive to the
Head Start community. Under HB 409, it seemed the bridge to rural
Alaska was being eliminated for doing a good job. Furthermore, the
fundamental philosophies of the Department of Education and Head
Start differed. Head Start saw parents as the prime educators, as
other testifiers had noted, as well as the shared decision-makers.
Rather than the "three Rs," socialization and self-concept skill
development were critical to Head Start.
Number 1168
MS. KING concluded by saying a transition to DOE would be expensive
in terms of time, energy and resources. Despite Representative
Kelly's assertions to the contrary, she saw HB 409 as a move to
reduce services in terms of administering programs that had already
been successful. She suggested an amendment disbanding DOE and
placing it in DCRA.
Number 1262
REPRESENTATIVE KELLY asked Ms. King if she was aware he had been
the chairman of the subcommittee providing funding to Head Start
the previous year. He noted that preservation of the Head Start
budget the previous year had mostly been due to his own efforts to
fund it at full levels. It was his desire, he said, to protect
Head Start.
Number 1370
JODI DELANEY testified via teleconference from Fairbanks. She said
she had not yet reviewed the whole of HB 409. She referred to
pages 2 and 6; she related her own problems with child support
enforcement and suggested those areas needed to be cleaned up
before they were combined. She referred to AS 11.35.005, defining
a relative, and spoke about a case involving the "best interests of
two twin babies that were wrongfully taken." She discussed her
interests relating to the bill and asked Representative Kelly to
contact her about HB 409. She said she would hate to see the good
parts die or get lost because it was too big to comprehend.
Number 1593
REPRESENTATIVE KELLY advised Ms. Delaney that in HB 409, she only
needed to pay attention to the bracketed and underlined language.
Most of Ms. Delaney's comments, as well as most of Mr. Calder's
before her, were directed to existing statute not affected by HB
409. Representative Kelly explained HB 409 was really a technical
bill renaming some departments because of the merger of DCRA and
DCED.
Number 1645
MS. DELANEY responded that from her corporate work experience,
change brought havoc, new ways of doing things and things being
left undone. Already, things were not being done or were being
done incorrectly. She said she understood how to read the bill.
But there were already serious problems that needed fixed first.
Number 1711
VIRGINIA WASHINGTON, Administrator, City of St. Michael, testified
via teleconference. She expressed concern about HB 409 and said
DCRA provided essential services and workshops to villages, linking
them to the region and the state. She wondered how much it would
cost to make the changes and how communities would be affected.
REPRESENTATIVE IRENE NICHOLIA pointed out that Ms. Washington had
asked a question.
Number 1934
REPRESENTATIVE KELLY said he had thought it was rhetorical and
asked Ms. Washington to repeat her question.
MS. WASHINGTON clarified that she wanted to know how a nonprofit
government would link to a profit-making system and how much it
would cost, for small villages like St. Michael, to turn over the
system.
Number 1934
REPRESENTATIVE KELLY replied it should not cost the villages
anything to turn over the system. As HB 409 was written, the field
people would remain in place and the functions of DCRA would
continue. He said that eliminating DCRA was a misnaming; they were
doing the same thing with DCED and creating a new department. All
the functions and services, he said, would remain. In an
environment of cutting budgets, he explained, the legislature was
faced with either cutting services or administration, or else
making administration more efficient. He said HB 409 attempted to
make the administration more efficient. Whereas HB 409 would have
up-front costs for the state, Representative Kelly did not envision
any costs or change of services at the field level in the villages.
Number 2037
LINDA HALL, Commercial Insurance Broker, Alaska Independent
Insurance Agents and Brokers, testified via teleconference from
Anchorage. She said there were several hundred members of her
organization statewide who were independent insurance agents. They
supported efforts to make government agencies more efficient and to
cut costs. However, she was concerned about moving the Division of
Insurance to the Department of Revenue. One of that division's
primary purposes, she said, was regulatory oversite of insurance
companies and agents. Equally important was consumer advocacy.
She felt encouraging a competitive marketplace was one of the best
ways to facilitate these. Moving the Division of Insurance to the
Department of Revenue would change its focus much to the detriment
of the current insurance environment.
Number 2240
LARE testified via teleconference from Anchorage. She said DCRA
had been a "small voice" and effective. She said Head Start did
not belong in the Department of Education. She discussed child
care as both an assistance for parents and as a business; it was
tied to family and community economics. She added that services
would in fact be cut if programs focusing on families and children
were moved to agencies where that was not their primary function.
TAPE 96-8, SIDE A
Number 0001
MS. LARE concluded by saying the notice on HB 409 had been
extremely short.
Number 0055
JOHN WHEATLEY, CEO, Willis Corroon Corporation of Anchorage,
testified via teleconference. He spoke in support of efforts
towards consolidation, but voiced concern about placing the
Division of Insurance, a regulatory agency responsible for consumer
protection, under the Department of Revenue.
Number 0142
JEANINE KENNEDY, Executive Director, Rural Alaska Community Action
Program (RurAL CAP), discussed what she thought impacts would be to
rural Alaska if DCRA were obliterated. She explained there were
200 villages in rural Alaska, which were isolated, remote and small
in population, inhabited by a unique population with cultures and
values different from western cultures and values. These villages
lacked infrastructure. The approach to get into business in
Anchorage, Fairbanks or Juneau would be different from that
required in a village. Trying to make everyone be the same would
not work. She said DCRA was one of the most efficient and well-
organized agencies in state government; she asked why one would get
rid of something that worked so well. She explained that what
worked about DCRA was their holistic approach. Rural Alaska, she
noted, had finally figured out DCRA, which would now be scrambled
up and put into something new. Ms. Kennedy thought this was
inefficient and would be costly. She asked how much it would cost
to move all the people and departments.
Number 0510
REPRESENTATIVE KELLY replied there was a current fiscal note of
$1.6 million for a one-time cost. There were indications of a
minimum $1 million per year savings from the merger.
Number 0545
MS. KENNEDY said she thought $1.6 million would be a good one-time
cost to put into infrastructure and economic development in rural
Alaska. She added that Head Start was not education; it was a
community program based on the parent as the primary educator. She
thought Head Start would be better left in DCRA because of its
community development approach and its promotion of local control.
Ms. Kennedy concluded by saying 200 people from rural Alaska would
be in Juneau March 18 - 22; she recommended they have an
opportunity for input on HB 409.
Number 0749
PAUL FUHS, Lobbyist, Alaska ARDOR Association, explained that ARDOR
associations were included within HB 409. Mr. Fuhs said his
association, which represented both urban and rural areas of the
state, saw no urban/rural split. Alaska was economically
interdependent, with most of the production being in rural Alaska.
His organization supported efforts to bring economic development
together in one place, including the concept of HB 409 in pulling
all the economic development programs into one. The bottom line
for ARDORs, he said, was private jobs.
Number 0890
MR. FUHS supported the idea of an 800 number providing a single
point of contact for economic development services; he felt it
would be well received throughout Alaska. He emphasized the
importance of training, which he recommended keeping in DCRA with
its economic development focus, rather than moving it to the
Department of Labor.
Number 1020
MR. FUHS discussed the impending cap on welfare. He said his
organization had no position on Head Start or child care, but he
noted that those would be included in economic development as
parents moved off of welfare. The ARDORs, he said, wanted to help
in these efforts and in providing private-sector jobs. They did
not view HB 409 as the elimination of DCRA, nor see it as a slap in
the face to rural Alaska.
Number 1090
MR. FUHS said he was "switching hats" and concluded by speaking not
as an ARDOR representative but as a private citizen and the former
commissioner of DCED. He referred to HB 409 sending the Division
of Banking, Securities and Corporations to another agency. Often
the first point of contact for people coming to Alaska, that
division, Mr. Fuhs felt, served an important economic development
function.
Number 1164
REPRESENTATIVE ELTON asked Mr. Fuhs whether he was concerned about
the proposed transfer of the Division of Insurance to the
Department of Revenue, speaking from his experience as a private
citizen and former commissioner of DCED.
Number 1189
MR. FUHS replied that there were some economic development parts of
the Division of Insurance; lack of a good insurance program was a
definite cost to business. He said the argument could be made that
the Division of Insurance was more regulatory than economic
development oriented. However, it was not as clear an argument as
for the Division of Banking, Securities and Corporations.
Number 1209
REPRESENTATIVE ELTON referred to the large number of boards a
commissioner was required to sit on; he asked Mr. Fuhs how he would
feel and whether he would have time for other things if he were
commissioner of the new combined department.
Number 1237
MR. FUHS explained that one of the main jobs of a commissioner was
sitting on those boards and commissions; he himself had sat on 18
of them. The nice thing about it, he said, was after the
legislators went home, a commissioner really got to put a stamp on
things through those boards and commissions. It was part of the
job.
Number 1263
REPRESENTATIVE ELTON asked whether Mr. Fuhs envisioned that one
commissioner could handle those duties from both DCED and DCRA.
MR. FUHS responded that his deputy commissioner had been able to
handle most of the regulatory functions. Mr. Fuhs suggested that
having those regulatory functions out of the department would free
more of a commissioner's time to look at economic development.
CO-CHAIR IVAN asked if there were any other people on
teleconference wishing to testify. He thanked the participants for
testifying and submitting documents for the record.
Number 1365
PATRICIA J. STANLEY, Executive Director, Council of Athabascan
Tribal Governments (CATG), gave a brief background of CATG,
explaining it began in 1985 as a way of taking responsibility for
growth and development in the Yukon Flats, a 55,000 square mile
area. The CATG had discovered there was no way to address only
economic development without having an infrastructure in place.
The past 11 years had seen a slow process of strengthening village
governments to prepare for taking on responsibilities for service
delivery, which CATG considered part of economic development, as
well as creating a base for private jobs to develop. Ms. Stanley
said her area depended on DCRA as one place that provided
everything from child care to planning, training for
administrators, setting up financial management systems and
straightening out bookkeeping.
Number 1500
MS. STANLEY added that her concern was in being able to go one
place where people knew each other, where there was a comfort level
and an expectation of receiving services. She asked where the $1
million savings would come from and what it would mean in terms of
services.
REPRESENTATIVE KELLY responded that the $1 million in savings would
come from eliminating administrative positions.
Number 1559
MS. STANLEY indicated she would prefer to see DCRA beefed up,
rather than taken apart. If consolidation were necessary, she
would rather see DCED go into DCRA than the other way around.
REPRESENTATIVE KELLY replied that he thought Ms. Stanley had
mistaken the purpose of HB 409. It was not necessarily eliminating
DCRA, but rather merging DCRA with DCED and changing the name. He
added there were not many testifiers opposing eliminating DCED and
said he was not sure why, but that would be just as big a mistake.
Representative Kelly emphasized that the economic development
functions of the two departments were being merged. He suggested
that was the engine that was going to drive the state, as well as
the engine most capable of pulling both urban and rural Alaska into
the 21st century so that Alaska could depend more on jobs and less
on government. He likened it to the old adage about teaching
people to fish rather than giving them fish.
Number 1659
MS. STANLEY proposed that when the Village Participation Conference
(VPC) met in Juneau, there should be another chance for testimony
and to get to know the bill better. She agreed with prior
testifiers who had suggested it was too much of a fast track to
digest. It was too important of an issue for every family in rural
Alaska; they needed additional time to consider.
Number 1698
CO-CHAIR IVAN expressed appreciation for Ms. Stanley's concerns.
However, he said, the committee had done all they could through the
notification process to reach rural communities in the state. He
assured Ms. Stanley that the committee was not trying to fast-track
a bill, but rather was trying to conduct some good public
discussion.
Number 1720
REPRESENTATIVE NICHOLIA noted that while HB 409 merged departments,
it also moved Head Start and child care into the Department of
Education.
Number 1738
REPRESENTATIVE ELTON asked Representative Kelly about his estimate
of $1 million in savings and noted that at the previous Thursday's
hearing, he had understood the savings in the fiscal note to be
$340,000. He further understood that at this point in time, at
least, no new fiscal note was forthcoming until there were further
amendments to the bill.
Number 1763
REPRESENTATIVE KELLY explained the $300,000 savings was the
departments' own estimate. He was not relying on the departments
to provide estimates of savings, which was his purview as the
chairman of the subcommittee budgets. However, he was relying more
on the departments for estimates of moving and other costs.
Representative Kelly added that, in reference to notification and
opportunity to look HB 409 over, the financial aspect of HB 409
would be discussed at length in the House Finance Committee and its
subcommittee meetings, where they would consider the $1 million
savings, fiscal notes and other issues; at that time, there would
be even more information. Representative Kelly indicated
willingness to amend the bill, using suggestions he considered
valuable, in order to have HB 409 make as much sense as possible.
Number 1822
REPRESENTATIVE ELTON added he thought it especially important to
note, during the course of the public hearing while many people
were on-line, that DCRA and DCED and their directors of
administration had come up with a fiscal note indicating savings of
approximately $300,000 to $350,000 per year. Representative Elton
said he looked forward to seeing the spreadsheets and work done by
the sponsor of the bill. However, he said, there were two
different estimates of savings.
Number 1845
REPRESENTATIVE KELLY noted that as cooperative as the departments
had been, they were not the legislature. The legislature would
determine through the power of appropriation the spending and
savings levels coming out of the merger, or from anything else they
did.
CO-CHAIR IVAN thanked Ms. Stanley for her testimony and asked if
anyone else present wanted to testify. He thanked the testifiers
across the state and present in person.
Number 1887
MR. ANDISON added a comment via teleconference. He referred to the
$1 million-per-year savings and said changing the name of the two
departments and putting it under a new title would not save the
money; there would actually be cuts of positions or programs, or
reduction in some way. He said in his experience, both DCED and
DCRA had their hands full. Mr. Andison said he saw little
duplication of services or job duties. Where efforts were
duplicated, he thought elimination of a job or program should
occur; however, drastic down-sizing would leave someone's work
undone or services poorly provided. He added that the Department
of Revenue would probably be pretty overworked. Communities
utilizing the services of both DCED and DCRA would somehow
ultimately suffer, he believed.
Number 1942
MR. ANDISON expressed to Representative Kelly that he himself, and
other people in the rural areas, would feel better if they
understood exactly where the jobs would be cut and where the duties
would be absorbed. Perhaps with clarification, he said, brought to
them in a concise way, and if they saw it was not going to
negatively affect them, they might be more supportive of some kind
of down-sizing. As it was, they worried about elimination of
something they depended upon to build their infrastructure.
Number 1995
CO-CHAIR AUSTERMAN asked Representative Kelly to take to heart the
concerns raised at the meeting, especially with regard to the
difficulty the 200 rural communities would have in going to a
variety of agencies to cover their needs. He noted that the
concept of a one-stop shop in DCRA was valued. Issues that
particularly stood out involved Head Start and child care and how
dependent they were. Co-Chair Austerman suggested that might tie
back to economic development. He thought Head Start and child care
might be reevaluated and put back into HB 409.
Number 2040
CO-CHAIR AUSTERMAN further suggested considering the interaction
between economic development and the Division of Banking,
Securities and Corporations, which was the first stop for new
companies coming to Alaska. He asked if those issues could all be
addressed or at least looked at before the next hearing.
CO-CHAIR IVAN noted that HB 409 would be heard again on Tuesday,
February 6, 1996. He asked the departments and the bill sponsor to
continue their dialogue and coordination on fiscal note questions.
He then thanked the committee for attending the Saturday meeting.
Number 2075
ADJOURNMENT
There being no further business to conduct, CO-CHAIR IVAN adjourned
the House Community and Regional Affairs Committee meeting at 3:20
p.m.
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