Legislature(1995 - 1996)

02/20/1996 01:13 PM CRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
              HOUSE COMMUNITY AND REGIONAL AFFAIRS                             
                       STANDING COMMITTEE                                      
                       February 20, 1996                                       
                           1:13 p.m.                                           
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Ivan Ivan, Co-Chair                                            
 Representative Alan Austerman, Co-Chair                                       
 Representative Kim Elton                                                      
 Representative Pete Kott                                                      
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 Representative Jerry Mackie                                                   
 Representative Al Vezey                                                       
 Representative Irene Nicholia                                                 
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 * HOUSE BILL NO. 401                                                          
 "An Act authorizing the issuance and sale of revenue bonds to fund            
 public wastewater systems, nonpoint source water pollution control            
 projects, including solid waste management systems, and estuary               
 conservation and management projects; authorizing the use of the              
 Alaska clean water fund to pay and secure the bonds and to pay                
 costs related to issuance and administration of  the bonds;                   
 authorizing certain measures to secure payment of the bonds; and              
 amending Alaska Rule of Civil Procedure 3."                                   
                                                                               
      -  PASSED OUT OF COMMITTEE                                               
                                                                               
 * HOUSE BILL NO. 400                                                          
 "An Act relating to welfare reform by establishing the Alaska                 
 Family Independence Program; repealing the aid to families with               
 dependent children and job opportunity and basic skills programs;             
 relating to an exemption to Alaska Wage and Hour Act for certain              
 work activities of the Alaska Family Independence Program; relating           
 to the duty to support children of minor parents; relating to                 
 certain licenses and applications for a license for persons who are           
 not in substantial compliance with orders, judgments, or payment              
 schedules for child support; relating to an exemption to the state            
 procurement code for certain services for the general relief                  
 program and Alaska Family Independence Program; relating to                   
 eligibility for day care benefits administered by the Department of           
 Community and Regional Affairs; authorizing the Department of                 
 Health and Social Services to operate a public assistance program             
 consistent with the Alaska Family Independence Program under                  
 federal waivers and providing certain immunity from liability for             
 activities of that program; amending Alaska Rule of Civil Procedure           
 90.3; and providing for an effective date."                                   
                                                                               
      -  HEARD AND HELD                                                        
                                                                               
 (* First public hearing)                                                      
                                                                               
 PREVIOUS ACTION                                                               
                                                                               
 BILL:  HB 401                                                               
 SHORT TITLE: REVENUE BONDS: WATER & WASTE PROJECTS                            
 SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                  
                                                                               
 JRN-DATE     JRN-DATE             ACTION                                      
 01/08/96      2378    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/08/96      2378    (H)   CRA, STATE AFFAIRS, RESOURCES, FINANCE            
 01/08/96      2379    (H)   2 ZERO FISCAL NOTES (REV, DEC)                    
 01/08/96      2379    (H)   GOVERNOR'S TRANSMITTAL LETTER                     
 02/20/96              (H)   CRA AT  1:00 PM CAPITOL 124                       
                                                                               
 BILL:  HB 400                                                               
 SHORT TITLE: WELFARE REFORM                                                   
 SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                  
                                                                               
 JRN-DATE     JRN-DATE             ACTION                                      
 01/08/96      2375    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/08/96      2376    (H)   CRA, STATE AFFAIRS, HES, FINANCE                  
 01/08/96      2376    (H)   10 FNS (3-DCED, 5-DHSS, 2-LABOR)                  
 01/08/96      2376    (H)   3 FISCAL NOTES (DOE, DPS, REV)                    
 01/08/96      2376    (H)   5 ZERO FNS (ADM, DCRA, DEC, F&G, DHSS)            
 01/08/96      2376    (H)   3 ZERO FNS (LABOR, LAW, DPS)                      
 01/08/96      2377    (H)   GOVERNOR'S TRANSMITTAL LETTER                     
 02/20/96              (H)   CRA AT  1:00 PM CAPITOL 124                       
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 KEITH KELTON, Director                                                        
 Division of Facility Construction and Operation                               
 Department of Environmental Conservation                                      
 410 Willoughby Avenue, Suite 105                                              
 Juneau, Alaska  99801-1795                                                    
 Telephone:  (907) 465-5180                                                    
 POSITION STATEMENT:  Presented HB 401 on behalf of the                        
                      Administration.                                          
                                                                               
 MARIE SANSONE, Assistant Attorney General                                     
 Natural Resources Section                                                     
 Civil Division (Juneau)                                                       
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska  99811-0300                                                    
 Telephone:  (907) 465-3600                                                    
 POSITION STATEMENT:  Answered questions on HB 401.                            
                                                                               
 BERDA WILLSON, Assistant Manager                                              
 Nome Joint Utilities                                                          
 City of Nome                                                                  
 P.O. Box 70                                                                   
 Nome, Alaska  99762                                                           
 Telephone:  (907) 443-5288                                                    
 POSITION STATEMENT:  Supported HB 401.                                        
                                                                               
 DIANA BENNETT, Finance Manager                                                
 Anchorage Water and Wastewater Utility                                        
 Municipality of Anchorage                                                     
 3000 Arctic Boulevard                                                         
 Anchorage, Alaska  99503                                                      
 Telephone:  (907) 786-5623                                                    
 POSITION STATEMENT:  Supported HB 401.                                        
                                                                               
 LEE SHARP, Attorney at Law                                                    
 Preston, Gates & Ellis                                                        
 420 L Street, Suite 400                                                       
 Anchorage, Alaska  99501-1937                                                 
 Telephone:  (907) 276-1969                                                    
 POSITION STATEMENT:  As bond counsel to the state, testified on HB            
                      401.                                                     
                                                                               
 JAY LIVEY, Deputy Commissioner                                                
 Department of Health and Social Services                                      
 P.O. Box 110601                                                               
 Juneau, Alaska  99811-0601                                                    
 Telephone:  (907) 465-3030                                                    
 POSITION STATEMENT:  Presented department's position and answered             
                      questions on HB 400.                                     
                                                                               
 JIM NORDLUND, Director                                                        
 Central Office                                                                
 Division of Public Assistance                                                 
 Department of Health and Social Services                                      
 P.O. Box 110640                                                               
 Juneau, Alaska  99811-0640                                                    
 Telephone:  (907) 465-3347                                                    
 POSITION STATEMENT:  Presented department's position and answered             
                      questions on HB 400.                                     
                                                                               
 CAROL YAKISH, Social Worker                                                   
 Kodiak Area Native Association                                                
 402 Center Street                                                             
 Kodiak, Alaska  99615                                                         
 Telephone:  (907) 486-5725                                                    
 POSITION STATEMENT:  Testified on HB 400.                                     
                                                                               
 LOUISE CHARLES, Administrator                                                 
 Job Opportunities and Basic Skills Program                                    
 Tanana Chiefs Conference                                                      
 122 First Avenue                                                              
 Fairbanks, Alaska  99701                                                      
 Telephone:  (907) 452-8251                                                    
 POSITION STATEMENT:  Supported HB 400.                                        
                                                                               
 ANGELA SALERNO, Executive Director                                            
 Alaska Chapter, National Association                                          
    of Social Workers                                                          
 1727 Wickersham Drive                                                         
 Anchorage, Alaska  99507                                                      
 Telephone:  (907) 563-4502                                                    
 POSITION STATEMENT:  Supported HB 400.                                        
                                                                               
 GENE OTTENSTOER                                                               
 Victims of the State; and                                                     
    Guardians of Family Rights                                                 
 c/o P.O. Box 1059                                                             
 Delta Junction, Alaska  99737                                                 
 Telephone:  (907) 895-4805                                                    
 POSITION STATEMENT:  Opposed HB 400.                                          
                                                                               
 SINEAD PHIPPS                                                                 
 Board of Directors                                                            
 Guardians of Family Rights                                                    
 c/o P.O. Box 704                                                              
 Delta Junction, Alaska  99737                                                 
 (No telephone listed)                                                         
 POSITION STATEMENT:  Opposed HB 400.                                          
                                                                               
 SHARON OLSEN, Chairperson                                                     
 Alaska Native Coalition on Employment                                         
    and Training (ANCET)                                                       
 320 West Willoughby Avenue, Suite 300                                         
 Juneau, Alaska  99802                                                         
 Telephone:  (907) 586-1432                                                    
 POSITION STATEMENT:  Testified on HB 400.                                     
                                                                               
 DARLENE DEWEY, Child Care Coordinator                                         
 Child Care and Development Block Grants                                       
 Kawerak, Incorporated                                                         
 P.O. Box 948                                                                  
 Nome, Alaska  99762                                                           
 Telephone:  (907) 443-3763                                                    
 POSITION STATEMENT:  Testified on HB 400.                                     
                                                                               
 BRENDA AKELKOK                                                                
 Bristol Bay Native Association                                                
 P.O. Box 310                                                                  
 Dillingham, Alaska  99576                                                     
 Telephone:  (907) 842-5257                                                    
 POSITION STATEMENT:  Testified on HB 400.                                     
                                                                               
 KRISTEN BOMENGEN, Assistant Attorney General                                  
 Human Services Section                                                        
 Civil Division (Juneau)                                                       
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska  99811-0300                                                    
 Telephone:  (907) 465-3600                                                    
 POSITION STATEMENT:  Answered questions on HB 400.                            
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 96-14, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 CO-CHAIR IVAN IVAN called the House Community and Regional Affairs            
 Committee meeting to order at 1:13 p.m.  Members present at the               
 call to order were Representatives Ivan, Austerman, Elton and Kott.           
 Members absent were Representatives Mackie, Vezey and Nicholia.               
 HB 401 - REVENUE BONDS:  WATER & WASTE PROJECTS                             
                                                                               
 Number 0059                                                                   
                                                                               
 CO-CHAIR IVAN noted that committee packets for HB 401 contained               
 copies of the bill, a bill summary, a sectional analysis, zero                
 fiscal notes from the Department of Environmental Conservation and            
 the Department of Revenue and back-up material.                               
                                                                               
 Number 0140                                                                   
                                                                               
 KEITH KELTON, Director, Division of Facility Construction and                 
 Operation, Department of Environmental Conservation (DEC),                    
 presented HB 401 on behalf of the Administration, saying he was               
 explaining both HB 401 and its companion bill, SB 207.  He offered            
 some background.  In 1987, when the Clean Water Act was                       
 reauthorized, it was mandated to drop the construction grants                 
 program and shift it into a low-interest loan program for the                 
 construction of wastewater facilities.  It also could apply to                
 solid waste facilities where ground water contaminants were being             
 treated, dealing with estuary contamination and controlling                   
 nonpoint source pollution.                                                    
                                                                               
 Number 0213                                                                   
                                                                               
 MR. KELTON explained that since 1989, DEC had administered the                
 Alaska Clean Water Fund, a program set up to make those low-                  
 interest loans.  The loans, which had fluctuating interest rates              
 tied to the municipal bond index, were available to incorporated              
 communities having a dedicated revenue stream to repay the loans.             
 Typically, the loans were for twenty years, with interest rates of            
 4 - 5 percent; currently, they were at 3.75 percent.  The loans               
 were, therefore, a fairly attractive financing alternative as                 
 general fund grants diminished.  To date, the fund had received               
 approximately $80 million, a combination of state and federal                 
 dollars.  Until the last two years, the demand for those funds had            
 been less than the availability.  However, that trend was                     
 reversing.                                                                    
                                                                               
 Number 0305                                                                   
                                                                               
 MR. KELTON expressed that at the current rate of obligation, the              
 fund would be used up in two years, except for the revolving                  
 portion that would come back.  Twenty-one other states administered           
 this "leveraged program," using the corpus of the fund as                     
 collateral and selling revenue bonds to leverage the account into             
 more dollars.  Mr. Kelton said DEC had worked with the Department             
 of Law, bond counsel and the Department of Revenue to come up with            
 a process that fit Alaska's needs.                                            
                                                                               
 Number 0373                                                                   
                                                                               
 MR. KELTON referred to the top half of a wall chart and said, "This           
 describes the program that we currently have in place, the Alaska             
 Clean Water Fund, which is capitalized 80 percent by federal                  
 dollars, 20 percent by state."  He referred to the blue center                
 portion, representing current funds, and said, "Of that $80                   
 million, approximately $50 million has been loaned to 24                      
 recipients.  In your packets, you will find a list of the                     
 communities that currently have received loans."  He added that the           
 only requirements were being incorporated and having a dedicated              
 revenue stream.  After the fund loaned money to municipal projects,           
 the repayment stream recycled back into the program.  That was what           
 was in place right now, he said.  The $30 million that was left               
 would be gone in two years unless something was done to "leverage"            
 that money, he added.                                                         
                                                                               
 Number 0463                                                                   
                                                                               
 MR. KELTON indicated that HB 401 set up a bond redemption fund,               
 which would then pay the bond issuance costs to the state bond                
 committee.  That committee would issue bonds for purchase by                  
 investors with the proceeds returning to a bigger Alaska Clean                
 Water Fund.  Those funds would recycle back through projects with             
 the repayment stream returning to the bond redemption fund to pay             
 off the bonds, and so forth.  There was the possibility of making             
 that $30 million into a much larger number and funding more                   
 projects statewide.  Although the program was not restricted to any           
 community, by virtue of the fact that it required a dedicated                 
 payment stream, it primarily benefited larger, incorporated                   
 communities.  Mr. Kelton indicated there was a list of                        
 participating communities in the bill packet.                                 
                                                                               
 Number 0570                                                                   
                                                                               
 CO-CHAIR AUSTERMAN referred to the $50 million in loans already               
 made and asked, "When does that cycle back in, so that there's not            
 a need to go out and buy more bonds?"                                         
                                                                               
 MR. KELTON replied that the whole repayment stream, as well as                
 additional federal capitalization, was dedicated to paying off the            
 bonds.  The $50 million already out there was a big incentive to              
 the bond-buying market, he said, since that repayment stream was              
 already dedicated.  That, in addition to the $30 million currently            
 unobligated, would provide the corpus to the fund.                            
                                                                               
 Number 0615                                                                   
                                                                               
 CO-CHAIR AUSTERMAN asked if Mr. Kelton was saying the total $80               
 million of the original fund was going to be the corpus.                      
                                                                               
 MR. KELTON clarified that the $30 million "just sitting there"                
 would be the main collateral.  However, there was money coming back           
 from the original $50 million already loaned to communities; that             
 repayment stream, with interest, returned to the fund and provided            
 assurance to the bond purchasers that the state had the ability to            
 repay those bonds.                                                            
                                                                               
 Number 0675                                                                   
                                                                               
 CO-CHAIR AUSTERMAN asked how big the bonds under discussion were.             
 Specifically, he was curious where the $50 million would go after             
 it was paid back.                                                             
                                                                               
 MR. KELTON replied it would go to new projects.  It would continue            
 to recycle.  This was one of the questions the Senate committee had           
 as well, he said, explaining, "We're working on two amendments                
 right now in their Senate CRA committee that will provide the cap             
 that you're talking about.  The language has not been approved yet            
 in the Senate CRA committee, but we're expecting it to be heard               
 tomorrow, and one of the proposals is that they would establish a             
 $15 million-per-year cap on the amount of revenue bonds that could            
 be sold, up to $100 million total.  This would allow a finite                 
 maximum the state would be able to go in debt on, even though this            
 particular proposal does not require the full faith and credit of             
 the state.  They're revenue bonds and, basically, the communities             
 are the ones who are establishing their full faith and credit."               
                                                                               
 Number 0753                                                                   
                                                                               
 REPRESENTATIVE PETE KOTT asked Mr. Kelton to explain the process as           
 it existed today, without the new legislation.                                
                                                                               
 MR. KELTON expressed that the program currently provided low-                 
 interest loans from the $80 million combination of state and                  
 federal dollars.  As those funds came back as principal and                   
 interest, they were again available for loans.  All HB 401 did was            
 to establish a larger pot of money through the sale of revenue                
 bonds.  The administration of the program would proceed exactly as            
 before.                                                                       
                                                                               
 Number 0828                                                                   
                                                                               
 REPRESENTATIVE KOTT asked whether, as the fund was depleted, money            
 would come back to municipalities, keeping that pool of money at              
 the present level, at least.                                                  
                                                                               
 MR. KELTON replied, "We definitely expect it will revolve.  The               
 level will be somewhat dependent on how many bonds are sold."  He             
 said they expected it to stabilize and be a revolving loan fund,              
 providing a fund in the neighborhood of $10 million to $15 million            
 per year.                                                                     
                                                                               
 Number 0872                                                                   
                                                                               
 REPRESENTATIVE KIM ELTON stated that his understanding was, "At the           
 present time, we have a loan fund that's capitalized with about $80           
 million.  $50 million of that is already out in loans to                      
 municipalities, leaving $30 million yet to be allocated.  Under               
 this bonding proposal, and if we accept the caps that are being               
 discussed on the other side, you would have the authority, over a             
 period of time, to build up your loan fund from the $80 million               
 that you have now to $180 million at some point in the future,                
 assuming that the caps that are being discussed on the other side             
 are imposed."                                                                 
                                                                               
 Number 0872                                                                   
                                                                               
 MR. KELTON said that was correct.                                             
                                                                               
 REPRESENTATIVE ELTON continued, saying, "So that you'd have a                 
 revolving loan fund that was partially capitalized with federal               
 dollars/state dollars/bond dollars, and the pool was $180 million             
 instead of $80 million."                                                      
                                                                               
 MR. KELTON indicated that was also correct.  He added, "We do                 
 expect that the reauthorization of the Clean Water Act, which is up           
 again, will include additional federal appropriations into this, so           
 with a state match, it could ultimately grow above that level."               
                                                                               
 Number 0950                                                                   
                                                                               
 CO-CHAIR AUSTERMAN asked Mr. Kelton what he saw as the dollar need.           
 He said, "If, in the last few years, you've been able to keep the             
 $30 million in there and not have to spend it, but now you say that           
 there's becoming more of a demand, at some point in time, the                 
 revolving aspect of this thing, where the $50 million comes back in           
 and is reloaned, is an ongoing process."  He asked if more than $80           
 million was needed if it was on a revolving loan basis.                       
                                                                               
 Number 0981                                                                   
                                                                               
 MR. KELTON replied that additional loans would be limited to the              
 repayment stream "once the first amount is out there."  With                  
 repayment on a 20-year cycle, only 1/20th of that would come back             
 in any given year.  After the money was cycled once, there would no           
 longer be $80 million until it started coming back.                           
                                                                               
 Number 1018                                                                   
                                                                               
 CO-CHAIR AUSTERMAN said that got back to his original question                
 about how long the cycle time was.                                            
                                                                               
 MR. KELTON responded that they were 20-year loans.  He pointed out            
 that the committee packets contained, in addition to the list of              
 projects where money had been loaned, a list of communities that              
 had expressed interest in receiving loans.  Currently, that list              
 involved approximately $78 million.  He added, "There is no                   
 certainty or an obligation on their part that they would ever need            
 to apply for those loans, but that's an expression of interest at             
 this date.  We do this on an annual basis.  Some of these projects            
 will get grants; some of them will fall by the wayside for other              
 reasons.  But at the current rate, which is $13 million a year, we            
 will be out of that corpus of $30 million within a two-year period.           
 We're trying to expand our capability of providing loan funds to              
 communities while we still have this corpus available.  Once this             
 corpus is loaned, we no longer have the collateral available to               
 sell these revenue bonds.  Passage of this legislation this year              
 will enhance the ability of this legislation to be effective,                 
 because the smaller that gets, the less leveraging we'll have                 
 available."                                                                   
                                                                               
 Number 1126                                                                   
                                                                               
 CO-CHAIR IVAN said he understood there were two situations.                   
 Currently, the Village Safe Water Program made grants to rural                
 water and sewer projects.  In contrast, this program was geared               
 towards those built-up communities like Anchorage that had the                
 necessary payback capability, through property taxes or other                 
 revenue streams.  Co-Chair Ivan asked if this would free up funds             
 for water and sewer projects, especially the Village Safe Water               
 Program, which funded rural areas lacking payback capability.                 
                                                                               
 Number 1180                                                                   
                                                                               
 MR. KELTON replied he would not presume how money might be                    
 appropriated by the legislature.  However, the legislature                    
 certainly had the potential, if part of the capital budget demand             
 were assumed by the loan program, of making additional limited                
 dollars in the capital budget available to other communities.                 
                                                                               
 Number 1215                                                                   
                                                                               
 CO-CHAIR IVAN referred to the 50/50 municipal matching grant and              
 asked if this program would free up funds from the municipal                  
 matching grants as they were today.  For example, he believed the             
 average provided was $25,000 per community for use as a matching              
 grant towards community projects.                                             
                                                                               
 Number 1255                                                                   
                                                                               
 MR. KELTON asked if Co-Chair Ivan was talking about the Governor's            
 matching grants program or DEC's.                                             
                                                                               
 CO-CHAIR IVAN replied, "the current capital matching grant                    
 program."                                                                     
                                                                               
 MR. KELTON thought it best to use the two programs in conjunction             
 with each other.  This would provide the ability to increase the              
 amount of dollars available to local projects.  If a community was            
 short of money after receiving a matching grant, it would certainly           
 be eligible to borrow the balance from the loan program, he said.             
 He thought the main place it saved was in the capital budget that             
 was approved, outside of the matching grants program.                         
                                                                               
 Number 1298                                                                   
                                                                               
 CO-CHAIR IVAN referred to Mr. Kelton's mention of estuary                     
 conservation.                                                                 
                                                                               
 MR. KELTON clarified that was estuary pollution control or                    
 correction.  Although it was eligible, they had never received an             
 application for estuary enhancement.  However, it was written into            
 the federal law, which the state was mandated to repeat in statute.           
                                                                               
 Number 1335                                                                   
                                                                               
 CO-CHAIR IVAN asked if state agencies were authorized to apply for            
 loans.                                                                        
                                                                               
 MR. KELTON replied that federal language authorized state agencies            
 to be eligible for loans.  He noted that was an item that the                 
 Senate CRA committee had also questioned.  As a result of that                
 committee's work, he said, there was an amendment that would be               
 prepared and heard the next day which redefined that to eliminate             
 state agencies.                                                               
                                                                               
 Number 1368                                                                   
                                                                               
 CO-CHAIR IVAN referred to the term "liberally construed" and asked            
 for a definition.                                                             
                                                                               
 MARIE SANSONE, Assistant Attorney General, Natural Resources                  
 Section, Civil Division (Juneau), Department of Law, explained that           
 in terms of statutory construction, the term "liberal construction"           
 meant that this statute should be broadly construed to give effect            
 to its beneficial purposes of providing money for the public                  
 wastewater projects and other pollution projects.  The term was               
 fairly standard in statutes, Ms. Sansone said.  In contrast,                  
 "strict construction" or "narrow construction" would indicate a               
 much more restrictive view of the words of the statute.                       
                                                                               
 Number 1477                                                                   
                                                                               
 REPRESENTATIVE KOTT asked if underground storage tanks would fall             
 within the scope of HB 401.                                                   
                                                                               
 MR. KELTON indicated that would have happened only if they were               
 going to make loans to state agencies.  Some states had dedicated             
 this program to that purpose, he added.  He emphasized the fund               
 primarily would be for new construction.                                      
                                                                               
 Number 1534                                                                   
                                                                               
 REPRESENTATIVE KOTT asked for an explanation of "state aid                    
 intercept."                                                                   
                                                                               
 MR. KELTON responded that the packet contained a more complete                
 discussion of that issue.  In a nutshell, the bond counsel had                
 informed them that having the "state aid intercept" language in               
 there meant the difference between selling the bonds at a "AA"                
 rating versus an "A" rating.  "It's assurance to the buyers of the            
 bonds that there's less chance of default," he said.  If there was            
 a default by a borrower, the state agency or agencies with control            
 of the funds could intercept undesignated funds to repay the                  
 defaulted loan.  It would apply to specifically appropriated funds,           
 Mr. Kelton said.  He referred to an example in the packet and added           
 that in the nationwide history of the loan program over the past              
 seven years, there had been no defaults.  In Alaska's history,                
 there had not been a single late payment.  They did not view this             
 as a significant problem, he emphasized.  Any community that                  
 defaulted would ruin its own credit rating.                                   
                                                                               
 Number 1651                                                                   
                                                                               
 BERDA WILLSON, Assistant Manager, Nome Joint Utilities, City of               
 Nome, testified via teleconference in favor of HB 401.  She asked             
 that the funds be provided only to communities in need and not to             
 state agencies.                                                               
                                                                               
 Number 1738                                                                   
                                                                               
 DIANA BENNETT, Finance Manager, Anchorage Water and Wastewater                
 Utility (AWWU), Municipality of Anchorage, testified via                      
 teleconference in favor of HB 401 and SB 207, its companion bill.             
 She read from a prepared statement:                                           
                                                                               
 "Although AWWU shares a common work force and management team, it             
 is actually two separate utilities for regulatory purposes,                   
 establishing separate rates for service and incurring separate debt           
 for capital projects.  The wastewater utility relies substantially,           
 in fact, almost entirely, on the Alaska Clean Water loan fund to              
 finance its comprehensive capital improvement plan.  We anticipate            
 borrowing $4-6 million annually from the loan program.  I hope the            
 funds will be available to do so.                                             
                                                                               
 "The low-interest loan program has been extremely popular and well            
 received throughout the country.  The Anchorage Wastewater Utility            
 has borrowed $8.8 million from this low-interest loan program, at             
 rates substantially lower than would be possible in the regular               
 bond market.  We estimate this has saved the ratepayers at least              
 $400,000 over the past four years, in addition to the flexibility             
 the program affords us.  In the years this Alaskan program has been           
 in existence, ADEC has made loans totaling $53 million.  There is             
 still a tremendous need for low-cost funding throughout the state.            
 ADEC received requests for $13 million in loans for the current               
 fiscal year.                                                                  
                                                                               
 "The bill now under discussion will allow what many other states              
 have done and leverage this initial capitalization money from the             
 federal government.  Increasing the amount of funds available                 
 allows projects to be completed sooner than if we have to wait for            
 our projects to move above the `cut line.'  This is a good way to             
 increase the pool of money available for necessary water quality              
 projects, without putting any other programs at risk.  The burden             
 for repayment remains with the communities requiring the funds and            
 there is a strong incentive for them, or for us, to continue to               
 make our repayments.                                                          
                                                                               
 "Without increasing the availability of funds, at the current                 
 request level of $13 million a year, the state is going to run out            
 of money to loan in only two years.  The loans are being repaid,              
 but the repayment stream has not reached equilibrium yet, and when            
 it does, it will still only be, I believe, $4-5 million, which is             
 well below the projected need.  The communities around the state              
 need this source of low-interest money to help finance sorely                 
 needed water quality improvements.                                            
                                                                               
 "The revenue bonds will be backed, not by the full faith and credit           
 of the state, but by the revenue coming from repayment of the                 
 loans.  As you've heard, in the history of the low-interest loan              
 program, there has never been a default -- not in the entire United           
 States.  In fact, in Alaska, there has never even been a late                 
 payment.  These bonds will be extremely safe.  The state will not             
 be required to `bail out' any agency over this.                               
                                                                               
 "You may have seen a Municipality of Anchorage memo listing some              
 recommended changes in this bill.  The Utility is substantially in            
 favor of the bill as was originally written; however, we were asked           
 to comment on the bill, with an eye to any proposed changes.  This            
 Utility works closely with ADEC and we have agreed among our two              
 groups that this bill, with or without any or all of the suggested            
 revisions, is extremely workable and will benefit the whole state             
 of Alaska.  I urge you to pass this bill.  Thank you for your                 
 time."                                                                        
                                                                               
 Number 1930                                                                   
                                                                               
 LEE SHARP, Attorney at Law, Preston, Gates & Ellis, testified via             
 teleconference that his firm had been acting as bond counsel to the           
 state, assisting ADEC with some of the language in HB 401.  He                
 expressed that he was available for questions with respect to the             
 peculiarities of bonding.                                                     
                                                                               
 Number 1954                                                                   
                                                                               
 CO-CHAIR AUSTERMAN asked Mr. Kelton how long ago the loan program             
 had begun.                                                                    
                                                                               
 MR. KELTON replied the program had been in place about six years.             
                                                                               
 CO-CHAIR AUSTERMAN referred to the $15 million per year of maximum            
 bonding, with $50 million being repaid over 20 years.  He suggested           
 there was a time frame for looking at getting that $15 million                
 stream coming back, so that bonding would no longer be needed.                
                                                                               
 Number 1969                                                                   
                                                                               
 MR. KELTON said it depended on the lengths of the loans.  Although            
 most were 20-year loans, some were less.  To come up with a firm              
 figure was difficult.  For example, if all $80 million were already           
 loaned for 20-years, the maximum principal repaid per year would be           
 $5 million.  There may be interest, as well.  That was a long ways            
 from the demand of $15 million, even if all the money were out                
 there and repayments coming back.                                             
                                                                               
 CO-CHAIR IVAN asked if others wished to testify; there were none.             
                                                                               
 Number 2062                                                                   
                                                                               
 REPRESENTATIVE ELTON noted that HB 401 had several other committee            
 referrals.  In light of that, he moved that HB 401 move from the              
 committee with individual recommendations and attached zero fiscal            
 notes.  There being no objection, it was so ordered.                          
 HB 400 - WELFARE REFORM                                                      
                                                                              
 Number 2093                                                                   
                                                                               
 CO-CHAIR IVAN noted that committee packets for HB 400 contained a             
 copy of the bill, the Governor's transmittal letter and numerous              
 fiscal notes from affected agencies.                                          
                                                                               
 Number 2133                                                                   
                                                                               
 JAY LIVEY, Deputy Commissioner, Department of Health and Social               
 Services (DHSS), expressed his intent to provide an overview of               
 both HB 400 and the progress of welfare reform in Washington, D.C.,           
 as those issues seemed to be linked.                                          
                                                                               
 Number 2148                                                                   
                                                                               
 MR. LIVEY explained there seemed to be two major issues with regard           
 to what was happening in D.C.  The major change was replacing the             
 entitlements with block grants.  Historically, Aid to Families with           
 Dependent Children (AFDC) had been a joint federal-state                      
 partnership in which the federal government matched state                     
 expenditures.  If populations increased or the economy turned                 
 downward, adding welfare recipients, the federal government would             
 participate with the state in funding those additional costs.  With           
 block grants, however, that was not necessarily the case.  The                
 block grant amount coming to the state would be based on a prior              
 expenditure year, which in Alaska's case would probably be 1994.              
 If the cost of AFDC rose in the future, it would leave the state              
 with the choice of adding funds or making changes to the program.             
                                                                               
 Number 2218                                                                   
                                                                               
 MR. LIVEY said the second major theme in D.C. was that welfare was            
 more than AFDC.  In the U.S. Congress, welfare reform included                
 changes to child support, food stamp, child care, Medicaid and                
 other programs.  In addition, there were bills in Congress                    
 combining and placing into block grants all the employment and                
 training money currently coming to the states.  On the federal                
 level, welfare reform meant comprehensive changes to a lot of                 
 programs that were interactive and which affected each other.                 
                                                                               
 Number 2260                                                                   
                                                                               
 MR. LIVEY explained that a stand-alone welfare reform bill had                
 passed both the House and the Senate in the U.S. Congress; that               
 bill had been vetoed by the President.  In addition, there were               
 welfare reform proposals currently under negotiation in the Budget            
 Reconciliation Act.  Recently, the National Governors Association             
 had met in D.C. and come up with a proposal about welfare reform.             
 Congressional hearings were scheduled on those provisions over the            
 next couple of weeks.   Mr. Livey thought there was a good chance             
 something would happen in welfare reform in the next year.                    
                                                                               
 Number 2296                                                                   
                                                                               
 MR. LIVEY said the ambiguity of not having federal welfare reform             
 had made everyone's jobs a little more difficult.  However,                   
 regardless of what happened in D.C., he felt reform should go                 
 forward.  If the U.S. Congress and the President went forward with            
 welfare reform, then HB 400 would provide a framework.  If that did           
 not happen, HB 400 offered a way of applying for waivers that would           
 implement as many provisions of the bill as possible.                         
                                                                               
 Number 2336                                                                   
                                                                               
 REPRESENTATIVE ELTON expressed concern that there was no protection           
 from future congresses.  If the block grant level was "x" one year,           
 it did not necessarily mean it would not be "y" the next year.                
 States would also have to pick up costs if federal funding was                
 reduced by a future congress.                                                 
                                                                               
 Number 2362                                                                   
                                                                               
 MR. LIVEY affirmed that was correct.  The bill, he said, was                  
 written so that the block grant amount received in 1996 would                 
 essentially be appropriated to the state every year for five years.           
 However, of course, Congress could come back and change that action           
 at any time.                                                                  
                                                                               
 REPRESENTATIVE ELTON noted that was exactly what the state had done           
 to municipalities under revenue sharing municipal assistance.                 
                                                                               
 Number 2383                                                                   
                                                                               
 JIM NORDLUND, Director, Central Office, Division of Public                    
 Assistance, Department of Health and Social Services (DHSS),                  
 indicated that the process leading to the legislation had been                
 quite thorough.  The bill was the product of several state agencies           
 besides DHSS, including the Departments of Labor, Law, Community              
 and Regional Affairs, Education, Administration, Revenue, and                 
 Commerce and Economic Development, as well as the Alaska Housing              
 Finance Corporation (AHFC) and the new Alaska Human Resources                 
 Investment Council (AHRIC).  An interagency task force had met over           
 the summer and in the fall; input from that task force was included           
 in the bill.  In addition, HB 400 was the product of the Governor's           
 blueprint for welfare reform which was released May 1, 1995.  There           
 had also been community meetings held in late summer and fall,                
 funded by the legislature, in 14 areas of the state.  Finally, HB             
 400 had been based on legislation introduced the previous year.               
                                                                               
 TAPE 96-14, SIDE B                                                            
 Number 0006                                                                   
                                                                               
 MR. NORDLUND emphasized that HB 400 was one element of a plan that            
 also included changes in the budget, as well as administrative                
 changes in DHSS that depended on neither the budget nor HB 400.               
                                                                               
 Number 0023                                                                   
                                                                               
 MR. NORDLUND set out the primary principles behind their approach             
 to welfare reform:  1) welfare would no longer be a permanent                 
 solution but would provide a temporary safety net; 2) work would be           
 emphasized; 3) benefits would be limited; and 4) recipients would             
 assume a measure of responsibility towards moving off public                  
 assistance and into the work force.                                           
                                                                               
 Number 0074                                                                   
                                                                               
 MR. NORDLUND touched briefly on changes in the operating budget.              
 In the current budget, they were requesting a "reinvestment of                
 saved benefit dollars."  This past year, he explained, there had              
 been a drop in the case load, which he suggested was, in part, due            
 to the state's welfare reform efforts.  They wanted to see those              
 dollars reinvested into job training and child care, which were               
 both essential for successful welfare reform.                                 
                                                                               
 Number 0104                                                                   
                                                                               
 MR. NORDLUND said his agency was trying to change the culture of              
 the welfare office.  In the past, they had simply determined                  
 eligibility and issued benefits.  Now, they wished to work with               
 clients to develop self-sufficiency plans and help them through the           
 necessary steps.  They were co-locating their agency with the                 
 Department of Labor's Division of Employment Security at various              
 locations around the state, both for programmatic and symbolic                
 reasons.                                                                      
                                                                               
 Number 0141                                                                   
                                                                               
 MR. NORDLUND explained that the bill itself, HB 400, was a                    
 comprehensive redesign of what was currently the AFDC program.  It            
 focused on work and self-sufficiency, as well as providing the                
 necessary tools.  It completely repealed the AFDC and JOBS                    
 programs.  Instead, it started over with a new program, the Alaska            
 Family Independence Program (AFIP).  The implementation of AFIP was           
 based on what DHSS anticipated to be changes in federal law.  As              
 Mr. Livey had mentioned, if the federal law did not change and                
 allow the state to implement the new program through the sweeping             
 changes envisioned in HB 400, there were provisions in the bill               
 that would allow DHSS to go forward and apply for waivers to                  
 implement as many changes as possible.                                        
                                                                               
 Number 0192                                                                   
                                                                               
 MR. NORDLUND noted that HB 400 was broadly constructed.  Many                 
 things the department planned to do would be done by regulation.              
 He suggested the fiscal note might provide a better idea of how the           
 program would operate than would the bill itself.  Mr. Nordlund               
 cited examples of ways the department would limit assistance.                 
                                                                             
 Number 0218                                                                   
                                                                               
 MR. NORDLUND referred to limits on benefits and said they were                
 carrying forward "what looks to be a requirement from the federal             
 government that there'll be a 60-month lifetime limit on benefits."           
 Secondly, they anticipated basing payment levels on household                 
 expenses, reducing benefits, for example, to families receiving               
 free or subsidized housing.  That would result in a savings of                
 approximately $2 million; in the fiscal note, DHSS was asking for             
 a realignment of those savings into increasing the earned income              
 disregard, which would provide further incentive for recipients to            
 take jobs.  There were a number of work incentives in the                     
 legislation, Mr. Nordlund added.                                              
                                                                               
 Number 0295                                                                   
                                                                               
 MR. NORDLUND said teens would be required to live at home and                 
 finish their high school education or obtain their GEDs in order to           
 receive benefits.  One-parent families would receive higher                   
 priority than two-parent families.  Sanctions or disqualifications            
 would also be established for recipients who refused to take                  
 appropriate jobs, assuming adequate child care was available and              
 that they were adequately trained for that employment.  Mr.                   
 Nordlund pointed out the heavy emphasis in HB 400 on work and job             
 development.  The Governor and DHSS intended for all recipients to            
 be in work-related activities within two years of first receiving             
 benefits.  A family would also be required to adhere to a self-               
 sufficiency plan developed between case workers and the family.               
 Mr. Nordlund said HB 400 also eliminated "what are currently                  
 federal regulations that are disincentives to work," one of which             
 was the 100-hour rule that disqualified any individual who worked             
 more than 100 hours per month.  He explained that most states were            
 doing away with that, either under waiver programs or state law.              
                                                                               
 Number 0394                                                                   
                                                                               
 MR. NORDLUND noted that current recipients were allowed a car                 
 valued at up to $1,500, which in many cases precluded adequate                
 transportation to work.  Under HB 400, that provision was                     
 eliminated for one car.  In addition, HB 400 provided incentives              
 for development of self-employment, if a recipient was so suited.             
 Opportunities for community service were also expanded through                
 nonprofit organizations.                                                      
                                                                               
 Number 0428                                                                   
                                                                               
 MR. NORDLUND emphasized that the primary reason AFDC existed, and             
 the reason DHSS wanted a cash assistance program to continue, was             
 that there were still poor people in Alaska with families.  The               
 bill continued to maintain a safety net for low-income individuals            
 with children.   What had been painstakingly avoided under HB 400             
 was making across-the-board benefit cuts.  Instead, cuts were being           
 made to provide incentives to work and to provide equity to                   
 families currently receiving AFDC.                                            
                                                                               
 Number 0481                                                                   
                                                                               
 MR. NORDLUND said the bill provided services to teen parents to               
 ensure they had safe homes.  He said they were working to establish           
 better cooperation and communication between food banks and food              
 kitchens in the state, as well.  He mentioned a food coalition                
 established by Commissioner Perdue.  More community involvement was           
 envisioned in the administration of what was currently the AFDC               
 program, Mr. Nordlund said.  Currently, the public assistance                 
 program was based on a state-to-client relationship, with 450                 
 employees in 12 offices located around the state.  In the future,             
 under welfare reform and the flexibility it would provide, he                 
 envisioned that local communities, including Native organizations,            
 local nonprofits or municipalities, could take over part of what              
 the Division of Public Assistance was currently administering.  Mr.           
 Nordlund added that HB 400 gave grant authority to DHSS to do that.           
                                                                               
 Number 0555                                                                   
                                                                               
 MR. NORDLUND explained that if a federal welfare bill were signed             
 into law, there was little doubt it would contain a Native set-               
 aside provision allowing Native organizations to contract directly            
 with the federal government to provide what is currently the AFDC             
 program.  The Administration was in support of that, Mr. Nordlund             
 said.  Furthermore, there was language in HB 400 that asked DHSS to           
 coordinate and cooperate with Native organizations as they worked             
 with the federal government to establish their own programs.                  
                                                                               
 Number 0608                                                                   
                                                                               
 MR. NORDLUND mentioned that child support was a big part of the               
 bill, which increased the tools available to the Department of                
 Revenue's Child Support Enforcement Division to collect payments              
 from child support obligors.  With regards to this, the language in           
 HB 400 was identical to that in the previous year's legislation.              
 He said language relating to possible withholding of individuals'             
 occupational or driver's licenses in lieu of child support payments           
 would probably be required by the federal government under welfare            
 reform proposals currently being considered by the Congress.                  
                                                                               
 Number 0663                                                                   
                                                                               
 MR. NORDLUND concluded by saying there was a section-by-section               
 analysis which had been provided with the legislation.                        
                                                                               
 CO-CHAIR IVAN referred to the possibility of block grants going to            
 the state, with some diverting to the Native community.  He asked             
 if that would decrease the number of personnel in the Division of             
 Public Assistance.                                                            
                                                                               
 Number 0695                                                                   
                                                                               
 MR. NORDLUND replied that the correct way of portraying that                  
 relationship would be that the monies coming from the federal                 
 government would not go to the state, but would go directly to the            
 Native organizations.  It would be a direct federal-Native                    
 relationship for the federal share of that money.  To answer Co-              
 Chair Ivan's question, he said there would probably be some affect            
 on the number of employees.  However, that was hard to determine              
 right now because currently the division also administered the food           
 stamp program, as well as the adult public assistance programs.               
 Their staff would still need to do eligibility for those programs,            
 while the Native organizations would do eligibility for the AFDC              
 programs.  He anticipated a reduction of staff if they gave up to             
 Native organizations not only the benefit dollars, currently                  
 administered by the state, but also some of the administrative                
 dollars.  However, it was too difficult to quantify right now, he             
 reiterated.                                                                   
                                                                               
 Number 0750                                                                   
                                                                               
 CO-CHAIR IVAN mentioned that he had voted for a measure that passed           
 the House last session.  He asked what the differences were between           
 HB 400 and the bill that passed the House the previous year.                  
                                                                               
 Number 0772                                                                   
                                                                               
 MR. NORDLUND explained that last year's legislation was based on              
 current law.  "The way we wanted to achieve welfare reform was                
 through waivers in the federal law," he said, adding that was a               
 much more piecemeal approach.  On the other hand, this year's                 
 legislation was a sweeping, comprehensive change, wiping clean the            
 current AFDC and child support statutes and starting all over.  "We           
 are doing this in anticipation of federal welfare reform," he said.           
 "Last year's legislation was based upon existing federal and state            
 law."                                                                         
                                                                               
 Number 0830                                                                   
                                                                               
 CO-CHAIR IVAN asked about the difference between last year's five-            
 year time line and the current one.                                           
                                                                               
 MR. NORDLUND explained that the previous year's legislation would             
 have been signed by the Governor except for the five-year                     
 provision.  Whether intentional or not, the way the Attorney                  
 General's Office read that legislation was that the five-year limit           
 would have kicked in for individuals starting at birth.  Any child            
 who was a beneficiary of the AFDC program for five years would                
 never be eligible for AFDC again, even if he or she needed                    
 assistance later as an adult with children.  The Governor had felt            
 that was exceptionally harmful to children and with some regret had           
 to veto an otherwise good piece of legislation because of that                
 provision, Mr. Nordlund noted.                                                
                                                                               
 Number 0885                                                                   
                                                                               
 CO-CHAIR IVAN referred to the Alaska Family Independence Program              
 (AFIP).  He asked about differences between AFIP and the AFDC and             
 JOBS programs that would be replaced.                                         
                                                                               
 Number 0906                                                                   
                                                                               
 MR. NORDLUND said the reason the JOBS program was no longer                   
 identified was not because that program was considered unimportant.           
 In fact, he said, they envisioned the whole public assistance                 
 agency essentially becoming like the JOBS program.  To make sure              
 that the AFDC program, as they knew it in the past, no longer                 
 existed, they had thought it appropriate to rename it.  It was also           
 renamed on the federal level, he noted.                                       
                                                                               
 Number 0971                                                                   
                                                                               
 REPRESENTATIVE ELTON said he was "half-way comforted" about the               
 five-year limit.  He asked if the five-year limit did not kick in             
 until the age of majority.                                                    
                                                                               
 MR. NORDLUND nodded yes.                                                      
                                                                               
 REPRESENTATIVE ELTON asked, "if a person, a parent, has been in the           
 program from the age of 21 to 26, what happens to the kids in that            
 family once the parent is kicked out?"  He further asked what                 
 percentage of the client base would probably be kicked out by a               
 five-year limit.                                                              
                                                                               
 Number 1014                                                                   
                                                                               
 MR. NORDLUND clarified that what was envisioned under the federal             
 law, which was being carried through in this legislation, was that            
 after 60 months of receiving benefits, the entire family would be             
 ineligible to receive benefits again.  Once a child in that family            
 grew up and had offspring, establishing a new case, he or she would           
 be eligible.                                                                  
                                                                               
 Number 1039                                                                   
                                                                               
 REPRESENTATIVE ELTON expressed concern over having a program that             
 kicked a child out for the failure of a parent to "matriculate from           
 the program, whatever the structure of that might be."  He said he            
 assumed that the structure of HB 400 anticipated the federal                  
 requirement of a 60-month limit and that there was nothing the                
 state could do about that.                                                    
                                                                               
 Number 1076                                                                   
                                                                               
 MR. NORDLUND replied, "We don't know exactly what the state could             
 do about that.  We don't know where we're going to be, necessarily,           
 in five years, once this provision kicks in."  He added that it was           
 of great concern to the Administration what happened to families              
 going over the 60-month limit.  It was their goal to not allow that           
 to happen.  "We need to bring as many forces to bear as we can to             
 make sure that those individuals are given every opportunity to               
 move into the work force as possible," he said.  He noted that                
 there was currently either a 15 or 20 percent exemption, depending            
 on which version of the federal welfare reform was looked at; the             
 National Governor's Association had suggested it be 20 percent.               
 That exemption would mean 20 percent of the case load would be                
 exempt from the 60-month limit.  Presumably, that exemption would             
 apply to people who were disabled and unable to work, or else                 
 individuals living in areas with chronically high unemployment                
 areas.  "This continues to be a source of concern to us," he said.            
 He voiced the need for child care and job training to get people              
 back into the work force.                                                     
                                                                               
 Number 1163                                                                   
                                                                               
 MR. LIVEY agreed the bill put much more responsibility on the                 
 family, as well as on the department.  He referred to the fiscal              
 note and the bill and said that in conjunction with the budget,               
 what was proposed was taking some savings from case load reductions           
 and continually reinvesting those savings into job training, child            
 care, adult basic education and so forth, so that people could work           
 their way off the program.                                                    
                                                                               
 Number 1222                                                                   
                                                                               
 CAROL YAKISH, Social Worker, Kodiak Area Native Association (KANA),           
 testified via teleconference, saying she had some concerns, mainly            
 because of her work with the Bureau of Indian Affairs (BIA) general           
 assistance program for the Native villages on Kodiak Island.  One             
 concern was not knowing whether BIA general assistance programs               
 would continue or how they would fit into the state block grant               
 areas, as well as whether KANA, as one of the 12 listed                       
 organizations, would or would not take on responsibility for what             
 was now known as the AFDC program.  Ms. Yakish thought the impact             
 on the villages would be great.  She was concerned about                      
 incorporating the requirements of the programs within the isolated            
 villages that had chronic high unemployment.                                  
                                                                               
 Number 1356                                                                   
                                                                               
 LOUISE CHARLES, Administrator, Job Opportunities and Basic Skills             
 Program, Tanana Chiefs Conference, testified via teleconference               
 from Fairbanks in favor of HB 400, which she thought was fair to              
 urban and rural welfare recipients alike.  She discussed the                  
 obstacles faced by people in welfare-to-work programs and provided            
 an overview of the tribal JOBS program.  It was impossible to serve           
 all eligible clients with their current funding, Ms. Charles said,            
 although they were trying their best.  She cited examples of                  
 agreements with other local agencies.  She noted that many clients            
 needed developmental or adult education courses prior to gaining              
 skills to get jobs that paid well enough to make workers self-                
 supporting.  Ms. Charles provided examples of clients who had moved           
 from the AFDC rolls because of job training programs and indicated            
 more funds were needed for that.  She emphasized the necessity of             
 looking at local solutions for rural areas.                                   
                                                                               
 Number 1944                                                                   
                                                                               
 ANGELA SALERNO, Executive Director, Alaska Chapter, National                  
 Association of Social Workers, testified via teleconference from              
 Anchorage, saying her association represented 450 social workers              
 statewide.  She spoke in favor of HB 400, which offered a well                
 developed and workable plan for removing recipients of AFDC into              
 work.  Considering the five-year limit, she said, recipients would            
 need work that would support their families.  She expressed strong            
 approval of the job training and child care provisions of HB 400,             
 both for people at school and at work, as well as provisions to               
 increase child support collections.  She commended the department             
 for their work on the bill.                                                   
                                                                               
 Number 2115                                                                   
                                                                               
 GENE OTTENSTOER, Victims of the State and Guardians of Family                 
 Rights, testified via teleconference from Delta Junction, asking              
 how much federal funding the state received by passing this bill              
 and others like it, such as bills on domestic violence.                       
                                                                               
 Number 2177                                                                   
                                                                               
 MR. NORDLUND replied that this bill did not directly affect the               
 amount of federal funding to be received.  Instead, it anticipated            
 a federal block grant, which would likely be the amount of money              
 received for the AFDC and JOBS programs, as well as for AFDC                  
 administration, in FY 1994.  That amount was less than amounts                
 currently received.  This bill was written envisioning fewer                  
 federal dollars available to the state for the administration of              
 these programs, Mr. Nordlund added.                                           
                                                                               
 Number 2236                                                                   
                                                                               
 MR. OTTENSTOER voiced that this bill and others like it were geared           
 to strip families of wealth and freedom and put them under the                
 whips of slavery.  It not only attacked the Constitution, Bill of             
 Rights and Magna Carta, it was an attack on the back-bone of our              
 country, which was the family.  Anyone who would vote for this bill           
 or any like it was committing treason.  A better plan of attack for           
 welfare reform would be to put recipients to work doing jobs that             
 were not very nice.  This would not only save money, but would                
 inspire recipients to get off welfare.                                        
                                                                               
 Number 2333                                                                   
                                                                               
 SINEAD (ph) PHIPPS, Board of Directors, Guardians of Family Rights,           
 testified via teleconference from Delta Junction, saying the bill             
 went against the Declaration of Independence and was another form             
 of unconstitutional attack on families, making it a crime to be               
 poor, because most poor families were not politically correct.                
 This bill was a back door for Communist take-over.  It would not              
 help anyone to become more self-sufficient but promoted more                  
 dependency on the government.  It advocated the promotion of                  
 Healthy Start and similar programs by way of back door taxing.  It            
 tried to control every aspect of a person's life, taking away the             
 rights and freedoms guaranteed by the Constitution of the United              
 States and the Holy Bible.  The state appeared to be wanting to               
 receive more federal bounty.  It appeared to be a means of robbing            
 from people to separate them from any possible means of wealth that           
 they may obtain to get ahead.  More government control was not what           
 was needed.  This was not a way of freedom, but a way of bondage.             
 Ms. Phipps disapproved renaming AFDC and disagreed with Section 36,           
 page 35.                                                                      
                                                                               
 TAPE 96-15, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 MS. PHIPPS concluded her comments by saying, "You are committing              
 treason and sedition, and do you know ... what could happen to you            
 for doing that?"                                                              
                                                                               
 Number 0073                                                                   
                                                                               
 SHARON OLSEN, Chairperson, Alaska Native Coalition on Employment              
 and Training (ANCET), noted that Ed Thomas had given testimony and            
 provided copies the previous day to "the Senate committee."  She              
 mentioned some personal background and then read from a three-page            
 document entitled, "Testimony on Welfare Reform Legislation,                  
 February 20, 1996," which she provided to the current committee as            
 part of a packet prepared by ANCET.                                           
                                                                               
 MS. OLSEN furnished background on the Tribal Job Opportunities and            
 Basic Skills (JOBS) Program; discussed consolidation of programs              
 under PL 102-477 and the joint partnership between Alaska Natives             
 and the federal government to provide services; and made                      
 recommendations.  Briefly, the recommendations addressed the                  
 following:  1) strengthening government-to-government relationship            
 between Alaska tribes and the state government; 2) supporting the             
 Governor's inclusion of a tribal match for FY 1997; 3) stimulating            
 economic development, with special emphasis on creating job                   
 opportunities for those dependent on public assistance; 4)                    
 consulting with tribal governments in development of state waiver             
 requests; 5) inviting tribes who were willing and able to contract            
 with the state for a block grant as a demonstration project until             
 the federal government passed welfare reform legislation; and 6)              
 developing Tribal JOBS Plans for the next two years.                          
                                                                               
 Number 0804                                                                   
                                                                               
 CO-CHAIR IVAN shared his opinions about the state of Alaska not               
 recognizing "so-called village tribal governments."  He                       
 acknowledged there was a debate over the sovereignty issue that he            
 wished could be set aside.  The tribal government IRAs had been in            
 place for centuries, he said, and were part of a community that               
 could help in the welfare reform process, if the arguments could be           
 set aside.                                                                    
                                                                               
 Number 0869                                                                   
                                                                               
 DARLENE DEWEY, Child Care Coordinator, Child Care and Development             
 Block Grants, Kawarek, Incorporated, testified via teleconference             
 from Nome.  Referring to AS 47.27.025 (a), regarding family                   
 assistance, she suggested that if the system intended to help                 
 families on AFDC become self-sufficient, assets should not be                 
 considered in determining benefits.  She did not favor a time                 
 limit.  She said most of the clients in the program lacked job                
 skills.   She thought clients in rural villages who were taking               
 college classes should be considered.  It cost money to leave the             
 village, she said, and having time limits would only put children             
 in jeopardy.                                                                  
                                                                               
 Number 1054                                                                   
                                                                               
 MS. DEWEY referred to definitions under AS 47.27.090 and said since           
 so many programs were involved, she recommended that the                      
 legislature come up with one flat income guideline.  The clients              
 using those services were AFDC clients and should not have to                 
 report every penny that went past their front door, she said.                 
 "Please define income, whether it is going to be earned or                    
 unearned, and delete assets as part of the applicant's                        
 requirements," she concluded.                                                 
                                                                               
 Number 1112                                                                   
                                                                               
 BRENDA AKELKOK, Bristol Bay Native Association, testified via                 
 teleconference from Dillingham.  She explained that as a tribal               
 entity, the association was interested in developing community                
 service and work experience positions under contract with the                 
 state.  However, they wondered what provisions there would be to              
 indemnify "these Native entities from liability if something should           
 happen to a work experience participant while they were on the                
 job."  She assumed such people would not be covered by Workers                
 Compensation.  She asked Mr. Nordlund to respond.                             
                                                                               
 Number 1171                                                                   
                                                                               
 MR. NORDLUND deferred to Kristen Bomengen to reply.                           
                                                                               
 KRISTEN BOMENGEN, Assistant Attorney General, Human Services                  
 Section, Civil Division (Juneau), Department of Law, said there               
 might be a couple of different circumstances that had been                    
 described here.  She acknowledged that all questions about what               
 coverages would be required had not yet been answered.  For                   
 subsidized employment, the entity employing the person would need             
 to ensure there was Workers Compensation coverage.  "I think that             
 there may be an unlimited number of potential liability issues,"              
 she said.  She pointed out that she was not really prepared to                
 address all of those issues.  "I think that there will be some                
 provisions where someone is hired working on behalf of an outside             
 employer, where we would, under state law, have to recognize the              
 Workers Compensation provisions," she added.                                  
                                                                               
 Number 1257                                                                   
                                                                               
 MS. AKELKOK responded that had answered some of the questions.                
 However, she was still interested in seeing, for community service            
 positions with nonprofits or state agencies, what protection there            
 would be for the tribal entity, as well as for the state.  She                
 added that concluded her testimony for now.                                   
                                                                               
 Number  1280                                                                  
                                                                               
 CO-CHAIR IVAN asked if there was any further testimony.  He noted             
 that the bill would be considered again.  He thanked the                      
 participants and mentioned that the next meeting would address HB             
 409 and HB 383.                                                               
 Number 1331                                                                   
                                                                               
 ADJOURNMENT                                                                   
                                                                               
 There being no further business to conduct, CO-CHAIR IVAN adjourned           
 the House Community and Regional Affairs Committee meeting at 3:09            
 p.m.                                                                          
                                                                               

Document Name Date/Time Subjects