Legislature(1993 - 1994)
02/22/1993 01:34 PM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
February 22, 1993
1:34 p.m.
TAPE HFC 93-28, Side 2, #000 - end.
TAPE HFC 93-29, Side 1, #000 - end.
TAPE HFC 93-29, Side 2, #000 - 411.
CALL TO ORDER
Co-Chair Larson called the House Finance Committee to order
at 1:34 p.m.
PRESENT
Co-Chair Larson
Co-Chair MacLean Representative Hoffman
Vice-Chair Hanley Representative Navarre
Representative Brown Representative Parnell
Representative Foster Representative Therriault
Representative Grussendorf
Representative Martin was absent from the meeting.
ALSO PRESENT
Representative Barnes; Mike Greany, Director, Legislative
Finance Division; Nancy Bear-Usera, Commissioner, Department
of Administration; Cheryl Frasca, Division Director, Office
of Management and Budget, Office of the Governor; Mary Lou
BUrton, Fiscal Analyst, Department of Fish and Game; Kit
Duke, Assistant Commissioner, Department of Public Safety;
C. E. Swackhammer, Deputy Commissioner, Department of Public
Safety; Kenneth E. Bischoff, Director, Division of
Administrative Services, Department of Public Safety; Bob
Bartholomew, Director, Division of Administrative Services,
Department of Transportation and Public Facilities.
SUMMARY INFORMATION
HSCR 2 Disapproving Executive Order No. 87.
HSCR 2 was reported out of Committee with "no
recommendation" and with a zero fiscal note by the
House Finance Committee for the Department of
Transportation and Public Facilities and with two
zero fiscal notes by the House Finance Committee
for the Department of Administration.
HB 101 "An Act relating to the adoption of the National
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Electrical Code and the National Electrical Safety
Code."
HB 101 was reported out of Committee with a "do
pass" recommendation and with a zero fiscal note
by the Department of Labor, dated 2/15/93.
HB 135 "An Act making supplemental and special
appropriations for the expenses of state
government; making, amending, and repealing
capital and operating appropriations; and
providing for an effective date."
HB 135 was HELD in Committee.
HOUSE SPECIAL CONCURRENT RESOLUTION NO. 2
Disapproving Executive Order No. 87.
REPRESENTATIVE RAMONA BARNES gave a brief overview of HSCR
2. She stated that HSCR 2 was introduced to disapprove the
Governor's order (EO 87) to transfer leasing
responsibilities to the Department of Transportation and
Public Facilities. She stressed that the Department of
Transportation and Public Facilities has "repeatedly ignored
the desires and mandates of the Legislature regarding budget
reductions to specific programs within the Department." She
brought to members attention an attached memorandum from
Legislative Finance Division dated February 10, 1993 to Rep.
Eldon Mulder regarding the FY 93 budget for the Design and
Construction components of DOT/PF (Attachment 1).
Representative Barnes noted that the Department of
Transportation and Public Facilities intends to establish a
sinking fund to be managed by a Board of Directors with
monies appropriated for leasing. She asserted that, "the
Legislature would virtually have no control over this fund
or how it is spent once money is transferred into it." She
pointed out that under the State of Alaska Constitution, the
Legislature has sole power of appropriation.
KIT DUKE, ASSISTANT COMMISSIONER, DEPARTMENT OF
TRANSPORTATION AND PUBLIC FACILITIES spoke in opposition to
HSCR 2. She noted that an organization was formed, Alaska
State Facilities Administrators (ASFA) to assess the
condition of the State's building inventory. It was
determined by ASFA that the State's deferred maintenance
backlog is approximately $250.0 million dollars and that the
State's buildings are deteriorating due to a lack of
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sufficient maintenance. There are currently eight executive
branch agencies with responsibility for building
maintenance. The Department of Transportation and Public
Facilities has responsibility for approximately one-third of
the State's buildings. She noted that the State must comply
with the Americans with Disability Act (ADA). She asserted
that the State needs to conserve energy. She noted that the
State spends $20 million a year on energy consumption.
Ms. Duke stressed that the State must also improve its
management of leased facilities to assure safe, healthy
buildings. The Department anticipates that savings can be
found to defer expenses the State is facing. She noted that
compliance with ADA could cost $400.0 million dollars. She
maintained that the State cannot afford to allow Departments
to separately address ADA compliance. She asserted that a
statewide maintenance plan must be developed. She avowed
that a centralized plan would allow the State to accomplish
more for the same amount of funding.
Representative Brown asked the status of legislation which
is being drafted to implement an authority. Ms. Duke
replied that the Department of Law has produced a draft
which is being reviewed. Ms. Duke assured Representative
Brown that Legislators will be able to review the draft
legislation prior to a vote.
Representative Brown questioned how EO 87 will affect land
disposal. Ms. Duke stated that EO 87 clarifies that the
Department of Transportation and Public Facilities has
authority to purchase and dispose of land for public
facilities. She elucidated that the purpose of the language
is to allow the Department to acquire land for construction
of public facilities.
Co-Chair MacLean inquired further into the Department's
authority to acquire and dispose land. She noted that the
Department would have broad authority. Ms. Duke assured her
that the Department's regulation requires due process. She
was not aware of any lands that the Department would be
disposing. She noted that the Department of Health and
Social Services will construct juvenile facilities through
the Department of Transportation and Public Facilities. The
Department of Transportation and Public Facilities will be
the overall authority for construction of new facilities by
other departments.
Representative Hoffman spoke in support of HSCR 2. He
referred to problems within his district concerning the
Department of Transportation and Public Facilities'
maintenance of airport facilities. He asserted that the
Department has not provided sufficient support to rural
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facilities.
Representative Brown asked if EO 87 would change agencies
lease/purchase arrangements. She noted that the Legislature
would have authority over leases of more that $1 million
dollars a year. The Department of Transportation and Public
Facilities would have authority over smaller lease
arrangements. This represents a transfer of authority from
the Department of Administration to the Department of
Transportation and Public Facilities.
Representative Navarre spoke in support of a uniform policy
for cost control and allocation of state facilities. He
noted that the Department of Transportation and Public
Facilities has not received sufficient funding for deferred
maintenance. He expressed concern with the creation of an
additional authority.
Representative Hoffman felt that the Department of
Transportation and Public Facilities has not given
sufficient priority to rural areas. Representative Navarre
pointed out that some funding within the Department of
Transportation and Public Facilities cannot be shifted.
Representative Barnes and Representative Navarre discussed
FY 93 funding to the Department of Transportation and Public
Facilities' Design and Engineering Component.
Representative Grussendorf noted that the Department of
Transportation and Public Facilities is the State's "most
complex and complicated division." He acknowledged the
difficulty the State has had to clean up the Department's
accounting for projects and reappropriations. He was
hesitant to add new authority to the Department.
Representative Brown noted that a fact sheet provided by Ms.
Duke states that, "The merger will prevent additional
expense to the Budget. It will be less costly to comply
with ADA and code upgrade requirements with consolidated
management than if many agencies are each separately
responsible." Representative Brown asked how EO 87 affects
ADA compliance. She noted that an administrative order
gives authority to agencies to comply with ADA. Ms. Duke
stressed that the administrative order would not be affected
by EO 87. She emphasized that the Department of
Transportation and Public Facilities will focus and plan for
ADA compliance. Each agency will retain overall
responsibility for ADA compliance.
Representative Parnell asked for specific projections of
cost and efficiency savings resulting from EO 87. He noted
that the State will expend $200.0 thousand dollars for the
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consolidation of services in the Department of
Transportation and Public Facilities. Ms. Duke stated that
the Department is endeavoring to identify savings to the
State. She gave as an example a pilot project which will
combine personnel of four agencies to complete maintenance
projects as a team. She noted that the Department is also
using FY 93 CIP funds for energy management to predict
energy savings to the operating budget.
Representative Barnes asked if agencies other than the
Department of Transportation and Public Facilities could
perform energy studies. Ms. Duke replied that one focus
point would more efficiently accomplish the task.
Representative Navarre reiterated his concern that there is
no coordination in the statewide leasing program. He added
that other factors such as; down time, moving and
reconfiguation costs are not included in calculations of
cost savings. He gave as example a case involving a lease
by the Department of Fish and Game in Kenai.
Representative Therriault observed that fiscal notes for EO
87 are zero. He asked why fiscal notes do not reflect the
costs involved. Ms. Duke stated that the proposed
legislation forming an authority will reflect the fiscal
costs.
NANCY BEAR-USERA, COMMISSIONER, DEPARTMENT OF ADMINISTRATION
spoke in support of EO 87. She acknowledged that the
Department of Administration has had a difficult time
managing the State's leasing program. She noted that leases
have been short-funded in an effort to force the Department
to better manage the program. The Department has analyzed
the leasing program. She emphasized that the procurement
code and the competitive bidding process has made management
difficult.
Commissioner Usera stressed the need to coordinate the
State's leasing program. She observed that lease expenses
are not included as expenses in all department's budgets.
She recommended a lease or facility cost charge-back system
to assure that departments evenly share the burden of these
costs. She agreed that both the Department of
Transportation and Public Facilities and Department of
Administration have had problems in managing lease programs.
She acknowledged that EO 87 would only be a first step.
(Tape Change, HFC 93-29, Side 1)
Commissioner Usera stated that programs and departments
would do cost accounting on the amount of space they occupy
and overhead costs. She emphasized that the Department of
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Administration supports EO 87. If EO 87 is not accepted the
Department of Administration will need to reconsider
management changes to improve the lease and state owned
facilities program. Commissioner Usera did not know the
composition of the proposed Board of Directors.
Representative Navarre encouraged the Legislature to address
the lease and deferred maintenance problem. Commissioner
Usera agreed with Representative Navarre. She stressed that
changes in the program's structure are needed.
Representative Navarre noted that the Legislature mandated
that the Department of Transportation and Public Facilities
use FY 93 CIP receipts for the Design and Engineering
component. Representative Barnes asserted that a
reappropriation occurred allowing the Department to add back
$1.5 million dollars into the Design and Engineering
Component, after Conference Committee deliberations.
Representative Parnell stressed that more information is
needed regarding potential cost savings. Ms. Duke
emphasized that savings will be realized in gained
efficiencies. She stressed that savings cannot be assessed
until the Department has an opportunity to test the
consolidation effort. She underscored that an authority is
important to guarantee accountability. She assured members
that the Department does not intend that funds will be
outside of legislative oversight and action.
Ms. Duke discussed the proposed sinking fund. She observed
that monies will be appropriated to agencies. Agencies will
deposit funds for deferred maintenance in the sinking fund.
The sinking fund allows monies for repair and major
maintenance beyond the fiscal year. This will permit
agencies to plan for major maintenance and repair
activities.
Ms. Duke clarified that the State would only perform
maintenance on leased buildings if the State's contract
contained provisions for maintenance. Representative Brown
asked how rent is affected by where the function is
performed. Ms. Duke agreed that where the function is
performed would not affect the rent paid.
Members discussed parliamentary proceedings regarding House
Special Concurrent Resolutions.
Representative Hoffman MOVED to report HSCR 2 out of
Committee with individual recommendations and with the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
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HSCR 2 was reported out of Committee with "no
recommendation" and with a zero fiscal note by the House
Finance Committee for the Department of Transportation and
Public Facilities and with two zero fiscal notes by the
House Finance Committee for the Department of
Administration.
HOUSE BILL NO. 101
"An Act relating to the adoption of the National
Electrical Code and the National Electrical Safety
Code."
Co-Chair Larson noted that HB 101 was passed out of the
Labor and Commerce Committee with five "do pass"
recommendations. He noted that HB 101 was requested by the
International Brotherhood of Electrical Workers to assure
the State's adoption of the minimum electrical safety
standards for the State as set by the American National
Standards Institute.
Representative Grussendorf MOVED to report HB 101 out of
Committee with individual recommendations and with the
accompanying fiscal notes. There being NO OBJECTION, it was
so ordered.
HB 101 was reported out of Committee with a "do pass"
recommendation and with a zero fiscal note by the Department
of Labor, dated 2/15/93.
HOUSE BILL NO. 78
"An Act relating to the testimony of children in
certain criminal proceedings; and providing for an
effective date."
Co-Chair MacLean submitted a request to waive HB 78 from the
House Finance Committee. Co-Chair Larson noted that HB 78
relates to the testimony of children. He stated that HB 78
is accompanied by a zero fiscal note and is supported by the
Department of Law. He observed that, "under current law, in
a criminal proceeding involving a child victim or witness,
the court can order that the testimony of the child be taken
by closed circuit television or through one-way mirrors if
it determines that the child's testimony under normal court
procedures would result in the child's inability to
effectively communicate." House Bill 78 would allow the
court to extend those privileges to children to the age of
7
16, up from the current age of 13.
Co-Chair Larson informed members of his intention to waive
HB 78 if there are no objections from members. Members were
informed to contact his office if they objected to waiving
HB 78.
HOUSE BILL NO. 135
"An Act making supplemental and special appropriations
for the expenses of state government; making, amending,
and repealing capital and operating appropriations; and
providing for an effective date."
CHERYL FRASCA, DIVISION DIRECTOR, OFFICE OF MANAGEMENT AND
BUDGET, OFFICE OF THE GOVERNOR reviewed HB 135 by section.
She began on section 28. (See House Finance Committee
minutes 2/18/93)
DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT
* Sec. 28 ASMI - $196.3 thousand dollars
This request would provide a general fund match to
federal dollars for the overseas marketing
program.
* Sec. 29 ASMI - $60.0 thousand dollars FY 92
extension
This request would extend the lapse date of the FY
92 balance to be used as general fund (GF) match
for the federal grant contained in section 28.
DEPARTMENT OF MILITARY AND VETERANS AFFAIRS
* Sec. 30 Veterans Death Gratuity - $90.0 thousand
dollars
This request would respond to increased claims.
DEPARTMENT OF NATURAL RESOURCES
* Sec. 31 Fire Suppression - $6.0 million dollars
Three million dollars would provide funding in the
case of a fire prior to fiscal year FY 94. The
Department incurs $3.6 million dollars in fixed
costs. Unused funds would lapse into the General
Fund.
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Representative Grussendorf referred to a letter submitted by
the Governor to the Legislative Budget and Audit Committee
requesting emergency funding for fire suppression. He noted
that no emergency existed. He recalled that the Legislative
Budget and Audit Committee decided not to appropriate
emergency funding for possible future fire suppression
needs.
* Sec. 32 Land Selection Program - $641.0 thousand
dollars
This request is the result of the expedition of
land selection in order to meet federal deadlines.
* Sec. 33 Challenge Alaska Grants -
This request would change the scope of a 1989
capital project grant.
DEPARTMENT OF FISH AND GAME
* Sec. 34 Division of Boards - $492.0 thousand
dollars
This request is the result of legislation enacted
during the Special Session of the Seventeenth
Alaska Legislature. (The original fiscal note
associated with legislation passed was for $365.0
thousand dollars. There was no vehicle for
passage of fiscal notes associated with
legislation.) The Division of Boards has had an
increase in board meetings.
* Sec. 35 Division of Subsistence - $8.0 thousand
dollars
This request is the result of legislation enacted
during the Special Session of the Seventeenth
Alaska Legislature. The original request by the
Division of Subsistence was $55.0 thousand
dollars.
* Sec. 36 King Salmon Tags - $84.3 thousand
dollars
This request would make vendor payments for King
Salmon tags. The request is the result of new
legislation. The associated fiscal note failed to
be included in the FY 93 Operating Budget.
Funding will be from the General Fund.
* Sec. 37 Ratify and Amend Prior Year Expenditures
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-
Old appropriations that have not been corrected in
the accounting system will be cleared.
* Sec. 38 Fund Shift -
This will replace unrealized federal receipts from
a 1987 CIP appropriation for Sport Fisheries,
Public Access Acquisition. Unrealized federal
receipts will be replaced by an appropriation from
the Fish and Game Fund of $134.7 thousand dollars.
The Department of Fish and Game incorrectly
identified state matching contributions.
MARY LOU BURTON, FISCAL OFFICER, DEPARTMENT OF FISH AND GAME
explained that state CIP funds were insufficient to match
federal funds. She added that the Department failed to
properly account for the state match. Section 38 will
replace monies that were spent out of the General Fund with
Fish and Game funds.
DEPARTMENT OF PUBLIC SAFETY
* Sec. 39 Contract Jails - $690.4 thousand dollars
This request would meet increased operating costs.
The FY 94 Operating Budget has been adjusted to
include FY 93 supplemental costs.
Co-Chair Larson asked for information concerning state jail
contracts.
C. E. SWACKHAMMER, DEPUTY COMMISSIONER, DEPARTMENT OF PUBLIC
SAFETY explained that contract jails are negotiated on an
annual basis. He noted that there is a state mandated
responsibility for prisoners. Disputes have occurred
between the State and municipality's concerning fair cost.
Representative Parnell asked if costs are based on prisoner
days. Mr. Swackhammer stated that there are fixed costs for
each municipalities that provides the service. In addition,
variables exist.
KEN BISCHOFF, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF PUBLIC SAFETY noted that contracts are not
negotiated for prior to appropriation requests. Mr.
Swackhammer stressed that prisoner location and prisoner
days are included in cost assessments.
* Sec. 40 Criminal Records and Id. - $90.6
10
thousand dollars
This request represents an increase in system use.
New legislation has been approved requiring
applicants for teacher certification and other
activities to supply fingerprint background
checks.
* Sec. 41 Bloodborne Pathogens - $126.7 thousand
dollars
This request would allow the Department to comply
with requirements regarding bloodborne pathogens.
The Department will purchase disposable gear and
vaccines.
* Sec. 42 Prisoner Transportation - $125.0
thousand dollars
This request would pay for the cost of increased
prisoner transportation. Costs are primarily for
air transportation.
* Sec. 43 Arbitration Settlement - $101.4 thousand
dollars
This request would pay settlement costs for
arbitration involving an employee and a controlled
substance.
(Tape Change, HFC 93-29, Side 2)
* Sec. 44 Civil Air Patrol - $125.0 thousand
dollars
This request is for aircraft maintenance and
operation costs.
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES
* Sec. 45 Arbitrator's Award - $539.6 thousand
dollars other funds.
This request would pay for overtime of on-site
construction engineers. The overtime dates back
to 1991 and is the result of arbitration.
BOB BARTHOLOMEW, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES
clarified that engineers are not eligible for overtime under
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federal law. During summer construction seasons engineers
work from 60 - 80 hours a week. Administrative policy
provided for straight time overtime for hours in excess of
37.5. In 1981, the Department implemented overtime policy
which provided that employees receive:
* 37.5 - 50.0 hours - no compensation,
* 50.0 - 72.0 hours - compensation.
Arbitrators ruled on behalf of the union that the overtime
policy could not be changed without union negotiation. Mr.
Bartholomew explained that the settlement has been paid to
employees. The FY 93 CIP projects will be short funded if
section 45 is not appropriated. Employees are classified,
range 16 and 18, field engineers.
* Sec. 46 Dalton Highway - $1,222.9 million
dollars
This request would pay for snow removal, ice
control and maintenance related activities.
* Sec. 47 Ratification of Prior Year Supply and
Inventory Asset Account Expenditures
Spoilage and breakage were not accounted for in
assessing supply and inventory assets.
* Sec. 48 Extend FY 93 Operating Lapse Date -
This request would extend the FY 93 Operating
Budget lapse date for maintenance and operations.
DEPARTMENT OF ENVIRONMENTAL CONSERVATION
* Sec. 49 Seafood and Sanitation Activities -
$351.2 thousand dollars
This request would replace unrealized program
receipts. The Department did not receive approval
to implement regulations assessing fees until
February 19, 1993.
* Sec. 50 Paralytic Shellfish Poison Inspections -
$109.9 thousand dollars
This request is the result of PSP infected crabs.
* Sec. 51 Water Quality Standards Advisory Group -
$41.4 thousand dollars
This request would pay for meeting costs.
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DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS
* Sec. 52 Organizational Grant - $300.0 thousand
dollars
This request would pay the first year
organizational grant for the Yakutat Borough.
* Sec. 53 Revenue Sharing - $25.6 thousand dollars
The Department of Community and Regional Affairs
used incorrect population figures to calculate
revenue sharing for the Central Mat-Su and Greater
Palmer fire service areas.
DEPARTMENT OF CORRECTIONS
* Sec. 54 Operations - $6,879.4 million dollars
UNIVERSITY OF ALASKA
* Sec. 55 UAF Snow Removal - $375.0 thousand
dollars
ALASKA COURT SYSTEM
* Sec. 56 Mental Health Trust Case Law Clerk -
$19.9 thousand dollars Mental Health
Trust
This request would add a law clerk to assist Judge
Green with the backlog involved in the Mental
Health Trust Case.
MULTIPLE DEPARTMENTS
* Sec. 57 Miscellaneous Claims and Stale-Dated
Warrants - $159.6 thousand dollars
This request would settle claims and billings that
are more than two years old for the Department of
Administration, Department of Health and Social
Services, Department of Labor, Department of
Public Safety, Department of Transportation and
Public Facilities, Department of Corrections and
Department of Military and Veterans Affairs.
HB 135 was HELD in Committee.
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ADJOURNMENT
The meeting adjourned at 3:30 p.m.
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