Legislature(1995 - 1996)
01/24/1995 01:34 PM House FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
January 24, 1995
1:30 P.M.
TAPE HFC 95-4, Side 1, #000 - end.
TAPE HFC 95-4, Side 2, #000 - end.
TAPE HFC 95-5, Side 1, #000 - end.
CALL TO ORDER
Co-Chair Mark Hanley called the House Finance Committee
meeting to order at 1:34 p.m.
PRESENT
Co-Chair Hanley Representative Kohring
Co-Chair Foster Representative Martin
Representative Mulder Representative Navarre
Representative Brown Representative Parnell
Representative Grussendorf Representative Therriault
Representative Kelly
ALSO PRESENT
Representative Jerry Sanders; Representative Cynthia Toohey;
Representative Alan Austerman; Representative Kim Elton;
Representative John Davies; Representative Irene Nicholia;
Representative Scott Ogan; Senator Lyda Green; Mike Irwin,
Commissioner, Department of Community and Regional Affairs;
Remond Henderson, Director, Division of Administrative
Service, Department of Community and Regional Affairs;
Arthur H. Snowden, II, Administrative Director, Alaska Court
System; Willie Hensley, Commissioner, Department of Commerce
and Economic Development; Guy Bell, Director of
Administrative Services, Department of Commerce and Economic
Development; Frank Rue, Acting Commissioner, Department of
Fish and Game; Kevin Brooks, Director, Division of
Administration, Department of Fish and Game; Frank Homan,
Commissioner, Commercial Fisheries Entry Commission.
SUMMARY
AGENCY OVERVIEWS:
Department of Community and Regional Affairs
Alaska Court System
Department of Commerce and Economic Development
Department of Fish and Game
(Copies of meeting tapes and handouts are on file with the
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Legislative Finance Division. Contact #465-3795).
DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS
Log # Discussion
031 MIKE IRWIN, COMMISSIONER, DEPARTMENT OF COMMUNITY
AND REGIONAL AFFAIRS introduced staff.
052 REMOND HENDERSON, DIRECTOR, DIVISION OF
ADMINISTRATIVE SERVICES, DEPARTMENT OF COMMUNITY
AND REGIONAL AFFAIRS noted that the Department is
composed of four divisions:
* Municipal and Regional Assistance;
* Administrative Services;
* Community and Rural Development; and
* Energy.
Mr. Henderson provided members with a handout
"Overview of the Department of Community and
Regional Affairs (copy on file). He observed that
page one provides a flow chart of the Department's
divisions.
093 Mr. Henderson noted that the Division of Energy
was created during the prior Legislature. He
suggested that the transition has been relatively
smooth.
114 Mr. Henderson informed members that the FY 96
budget will not contain significant changes in
programs or organization from the FY 95 budget.
139 Co-Chair Hanley asked if the Department had taken
a position on requests by the Alaska Municipal
League. Commissioner Irwin replied that the
Department has not yet formulated a position in
regards to the requests by the Alaska Municipal
League.
155 Co-Chair Hanley cautioned that repayment
obligations for the FY 95 withdrawals from the
Constitutional Budget Reserve Fund may effect the
unappropriated balance in the Power Cost
Equalization Fund.
170 Representative Martin noted that the previous
administration suggested significant changes
through increments and decrements within the
Department. He expressed concern that Headstart
grants were reduced while local government
training was increased.
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222 Mr. Henderson explained that there are no net
increases. He emphasized that interagency
transfers account for some of the increments and
decrements. He pointed out that the reduction to
Headstart grants were the result of the conclusion
of funds from past capital budget appropriations.
240 Commissioner Irwin stated that he is in the
process of reformulating priorities. He noted
that the Department's priorities will reflect
those of the Governor's.
274 Co-Chair Foster inquired into possible federal
reductions in the Headstart Program. Mr.
Henderson replied that federal funding levels were
unknown.
285 Co-Chair Foster noted that the Headstart Program
has been stable over the past several years.
300 Co-Chair Hanley inquired about the Bulk Fuel
Program. Commissioner Irwin acknowledged that
bulk fuel containment is a huge problem for the
State. He stated that the Department is looking
into models for the Program.
320 Co-Chair Foster noted that the Community
Development Quota (CDQ) Program has been very
successful. Commissioner Irwin agreed that the
CDQ Program is a model for rural Alaska. He added
that the Department is looking at restructuring to
allow one position to work on the CDQ Program
nearly full-time.
360 Representative Austerman asked if the Department
anticipated a philosophical change from the
previous administration regarding privatization.
Commissioner Irwin had no position.
380 Representative Grussendorf questioned the status
of the Senior Citizen Tax Relief Program. Mr.
Henderson noted that legislation to allow local
option did not pass. He anticipated that state
funding would be at approximately 10 percent of
the required amount for full funding.
390 Representative Kohring asked the status of the
Sutton/Glenallen intertie. Commissioner Irwin
assured him that dialogue with concerned citizens
is proceeding.
423 Representative Brown asked if job training
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programs would be redesigned. Commissioner Irwin
noted that job training is an important part of
welfare reform.
430 Representative Kelly inquired into the
Department's long range plans.
450 Commissioner Irwin accentuated doing more with
less through more efficient use of funding.
470 In response to a question by Representative
Therriault, Commissioner Irwin noted that the
Department first existed in the Governor's office
in the early 1970's.
480 Co-Chair Hanley noted that Representative Kelly
would chair the House Finance Subcommittee for the
Department of Community and Regional Affairs.
ALASKA COURT SYSTEM
490 ARTHUR H. SNOWDEN, II, ADMINISTRATIVE DIRECTOR,
ALASKA COURT SYSTEM emphasized that the case load
continues to grow.
500 Mr. Snowden testified as a member of the Criminal
Justice Work Group. He reviewed the composition
of the Group. He emphasized that the Group
unanimously recommended that "real progress cannot
be made in cost reduction unless the legislative
and executive branches take meaningful steps to
control alcohol."
526 Mr. Snowden noted that the Group recommends
increasing the state tax on alcohol, giving
communities more flexibility on the local level,
creating penalties for providing alcohol to a
person on probation, requiring identification
cards for all alcohol purchases that can be
revoked upon conviction of an alcohol-related
offense, and court mandated use of Antabuse. He
cautioned that the use of Antabuse would need
medical screening.
550 Mr. Snowden observed that increases in federal
contributions will add 50 police officers to the
Anchorage area. He pointed out that greater
enforcement will result in an increased court
caseload. He observed that passage of legislation
requiring mandatory life sentencing (HB 38) would
also increase court time.
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570 Mr. Snowden referred to the State of Alaska,
Department of Administration, Division of
Personnel and Office of Equal Employment
Opportunity, 1994 Salary Survey Report. He noted
the report concluded that the total pay gap
between non represented and represented employees
is at least 6.2 percent. He quoted that the
"State Personnel Act requires that the statutory
pay plan `reflect the principle of like pay for
like work' (AS 39.25.150(2)(b)."
596 Mr. Snowden emphasized that case delays are
common. He noted that the delay for divorce cases
is over a year.
614 Mr. Snowden requested that Alaska Court System
personal services be reduced to 5.5 percent under-
funding.
625 Mr. Snowden observed that funding for operations
and maintenance of the Anchorage Court Building is
a priority.
628 Mr. Snowden requested the addition of a labor
relations specialist position to negotiate with
newly formed employee union groups.
633 Mr. Snowden reiterated the need for deferred
maintenance funding in the capital budget.
654 Mr. Snowden emphasized that the Court has
experienced an increased workload due to levies of
Permanent Fund Dividend checks.
665 In response to a question by Co-Chair Hanley, Mr.
Snowden stated that the Alaska Court System is
seeking an additional $3.0 million dollars. This
figure did not include funding for reducing salary
discrepancies. He acknowledged that legislation
would be needed to address discrepancies in salary
between unrepresented Alaska Court System
employees and other represented state employees.
(Tape Change, HFC 95-4, Side 2)
001 Mr. Snowden noted that Alaska Court System
employees are the lowest paid state employees.
032 In response to a question by Co-Chair Foster, Mr.
Snowden acknowledged that domestic violence cases
have increased over the past 8 years. He
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discussed social problems leading to an increased
court load.
056 Representative Therriault expressed concern with
the number of appeals. Mr. Snowden emphasized
that all states have an appeal process.
098 Representative Therriault asked if there is a way
to reduce the cost of state supported appeals.
116 Mr. Snowden noted that the Judicial Branch is not
under the Executive Budget Act.
167 Mr. Snowden stated that a courtesy copy of the
Alaska Court System's budget was presented to the
Office of Management and Budget.
180 Mr. Snowden pointed out that the Anchorage Court
House Building's debt service will be retired in
10 years.
199 Discussion pursued regarding the savings realized
by the purchase of the Anchorage Court House
Building.
214 Representative Parnell questioned the status of
the Anchorage Office Space lawsuit. Mr. Snowden
noted that the Trial Court ruled in favor of the
State. An appeal is continuing.
232 Mr. Snowden anticipated that the Alaska Court
System will occupy the building in January 1996.
250 Representative Therriault pointed out that the
shift of a Fairbanks's district judge to full
jurisdiction.
DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT
288 WILLIE HENSLEY, COMMISSIONER, DEPARTMENT OF
COMMERCE AND ECONOMIC DEVELOPMENT gave a brief
presentation of the Department's functions. He
stressed that the Department's goal is to promote
an active, healthy and expanding business
community. He added that regulatory programs are
managed to protect Alaskan consumers while at the
same time minimizing government imposed barriers
to business activity. Economic development
programs are designed to develop, strengthen and
diversify Alaska's economic base, increase
employment opportunities and stimulate private
enterprise.
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301 Commissioner Hensley noted that the Department has
eight divisions and nine independent agencies
governed by boards and commissions. The
Commissioner is on twelve boards and councils.
312 Commissioner Hensley noted that the Department's
budget is still being developed.
332 GUY BELL, DIRECTOR, ADMINISTRATIVE SERVICES,
DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT
stressed that the Department's budget is revenue
neutral. He emphasized that the Department of
Commerce and Economic Development generates
revenue through its regulatory functions.
365 Commissioner Hensley accentuated issues that need
legislative attention. He noted that the Alaska
Public Utilities Commission (APUC) will sunset
without extending legislation. He added that the
regulatory cost charge to utilities was repealed
reverting APUC funding support to the General
Fund.
377 Commissioner Hensley discussed the Governor's
efforts to work with industry. He emphasized the
need for good communication between industry and
government.
420 Representative Mulder referred to FY 95
supplementals for the Alaska Tourism Marketing
Council. Commissioner Hensley stated that the
amount needed for the supplemental is
undetermined.
434 Representative Mulder inquired into the
possibility of establishing a broad based tax on
the tourism industry.
450 Commissioner Hensley pointed out that the industry
already participates extensively.
470 Representative Mulder encouraged Commissioner
Hensley to work with the Alaska Tourism Marketing
Council to enable it to be financially self-
sustaining.
482 Commissioner Hensley noted the difficulty in
developing an acceptable formula for taxing the
industry.
489 Representative Martin emphasized the need for less
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in-kind services and a greater cash contribution.
He suggested that tourism councils be combined.
518 Representative Martin referred to the Enhancement
Tax. He noted that a greater portion of the tax
is returned to local governments. He emphasized
the need to recoup the State's investment.
525 Representative Martin expressed concern with the
increase in the Department's administrative costs
contained in the Hickel budget.
540 Mr. Bell noted that Governor Knowles' budget for
the Department of Commerce and Economic
Development's will be ready in February.
550 Representative Brown referred to the MarkAir
request for AIDEA support.
575 Commissioner Hensley emphasized the number of jobs
provided by MarkAir.
580 At the request of Representative Therriault, Mr.
Bell provided members with a flow chart of the
Department's divisions (copy on file).
593 Representative Kohring noted the need for
diversification and long range planning. He
emphasized that the State contains untapped
resources.
602 Commissioner Hensley acknowledged the need to
ensure utilization of the State's resource
potential.
640 Commissioner Hensley discussed areas the
administration can explore for further
development.
650 Representative Austerman expressed concern that
reductions to the Alaska Tourism Marketing Council
has resulted in a reduction of the State's
advertising effort. He stressed that industry is
willing to assume a greater portion of the effort.
He referred to the fishing industry as an example
of industry effort.
(Tape Change, HFC 95-5, Side 1)
DEPARTMENT OF FISH AND GAME
001 FRANK RUE, ACTING COMMISSIONER, DEPARTMENT OF FISH
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AND GAME discussed the process of selecting a
commissioner. He introduced staff.
041 Acting Commissioner Rue noted that the
Department's job is to improve the state's
resources and to protect, manage and maintain the
fishery resource.
098 Acting Commissioner Rue noted that the
Department's divisions have been reduced from nine
to six.
126 Acting Commissioner Rue stressed that the
Department's general fund dollars have been
reduced by over 20 percent during the past four
years.
134 Acting Commissioner Rue accentuated that no
significant changes are anticipated. He
emphasized the Department's challenge to meet its
basic responsibilities.
158 Acting Commissioner Rue reviewed issues of
national and international concern effecting the
Department.
170 Acting Commissioner Rue suggested that increased
management of the State's shellfish resource may
result in additional revenues.
200 Co-Chair Foster noted that the Department uses and
maintains aircraft.
233 KEVIN BROOKS, DIRECTOR, ADMINISTRATIVE SERVICES,
DEPARTMENT OF FISH AND GAME emphasized that the
Department has continued to use charter services
in addition to department aircraft. He noted that
the majority of aircraft used to enforce fish and
game regulations are maintained by the Department
of Public Safety.
250 Mr. Brooks clarified that state personal are
covered in case of death or injury while on state
duty.
273 Acting Commissioner Rue explained that some
increments and decrements in the Department's
budget reflect the transfer of state hatcheries to
the private sector.
300 Mr. Brooks noted that the Divisions of Fisheries
Rehabilitation and Economic Development (FRED) and
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Commercial Fisheries (COMFish) were realigned to
the Division of Commercial Fisheries Management
and Development.
320 Discussion pursued regarding the Fish and Game
Fund.
331 Representative Mulder asked for advise in
extending management of Alaska waters from the
three to fifty mile limit. Acting Commissioner
Rue promised to research possibilities.
357 FRANK HOMAN, COMMISSIONER, COMMERCIAL FISHERIES
ENTRY COMMISSION noted that legislation was passed
in the previous session allowing the Division of
Loans to finance tax obligation of limited entry
permit holders to the IRS. He observed that there
is significant demand for the program. He
clarified that recipients must pledge their permit
to the State as security and must be current with
the IRS.
380 Representative Grussendorf queried if the budget
would adequately reflect the amount needed to
protect the resource. Acting Commissioner Rue
assured him that the budget would contain adequate
funding to protect the resource.
394 Representative Grussendorf inquired into the
possibility of encouraging regional advisory
input.
410 Acting Commissioner Rue did not anticipate that
the activity of the Advisory Boards would
increase.
415 Acting Commissioner Rue noted that the Department
employs 700 full and approximately 700 seasonal
employees.
429 Co-Chair Foster asked if the Department actively
recruits local hires. Mr. Brooks assured him that
the Department actively pursues local hires for
seasonal employees.
446 Representative Davies expressed concern that
research needed to assure a healthy interior
fisheries continues.
452 Acting Commissioner Rue acknowledged the need to
increase research into the Fall Chum Salmon crash.
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465 Representative Ogan noted problems in his district
concerning the Deshka River.
500 Acting Commissioner Rue emphasized the
Department's intention to release Sockeye Salmon
into the Susitna River system.
513 Co-Chair Hanley noted that the House Finance
Subcommittee on the Department of Fish and Game
will address funding from the Fish and Game Fund.
Co-Chair Hanley is the Subcommittee Chair.
516 Representative Navarre pointed out that the
fisheries in his district are heavily used by
sport fisherman. He indicated that the Kenai area
needs further attention from the Department.
527 Representative Kohring stressed the importance of
maintaining the sustained use principle. He noted
that the fishing industry is important to his
district.
ADJOURNMENT
The meeting adjourned at 3:34 p.m.
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