Legislature(1995 - 1996)
05/04/1996 11:50 PM House FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
MAY 4, 1996
11:50 P.M.
TAPE HFC 96 - 164, Side 1, #000 - end.
TAPE HFC 96 - 164, Side 2, #000 - end.
TAPE HFC 96 - 165, Side 1, #000 - end.
TAPE HFC 96 - 165, Side 2, #000 - end.
TAPE HFC 96 - 166, Side 1, #000 - end.
TAPE HFC 96 - 166, Side 2, #000 - #573.
CALL TO ORDER
Co-Chair Mark Hanley called the House Finance Committee
meeting to order at 11:50 P.M.
PRESENT
Co-Chair Hanley Representative Martin
Co-Chair Foster Representative Mulder
Representative Brown Representative Navarre
Representative Grussendorf Representative Parnell
Representative Kelly Representative Therriault
Representative Kohring
ALSO PRESENT
Representative Carl Moses; Representative Scott Ogan; John
Walsh, Staff, Representative Richard Foster; Fred Fisher,
Fiscal Analyst, Legislative Finance Division; Kelly Huber,
Staff, Senator Rick Halford; Annalee McConnell, Director,
Office of Management and Budget, Office of the Governor;
Brett Huber, Staff, Senator Lyda Green; Nancy Slagle,
Director, Division of Budget Review, Office of Management
and Budget; Gary Hayden, System Director, Marine Highway
System, Department of Transportation and Public Facilities;
Chris Clark, Staff, Representative Carl Moses; Nico Bus,
Director, Division of Administrative Services, Department of
Natural Resources; Janet Clarke, Director, Division of
Administrative Services, Department of Health and Social
Services; Thomas Bringham, Director, Division of Statewide
Planning, Department of Transportation and Public
Facilities; Laurie Otto, Deputy Attorney General, Criminal
Division, Department of Law; Richard Pegues, Director,
Administrative Services Division, Department of Law; Sam
Kito, III, Legislative Liaison, Special Assistant, Office of
the Commissioner, Department of Transportation and Public
Facilities; John Bitney, Alaska Housing Finance Corporation,
Department of Revenue; Karen Rehfeld, Director, Division of
Administrative Services, Department of Education; Tom
Wright, Staff, Representative Ivan Ivan; Tim Sullivan,
1
Alaska Craftsman Home Program, Anchorage Homebuilders
Association, Anchorage; Daniel Fauske, Executive Director,
Alaska Housing Finance Division, Department of Revenue.
SUMMARY
HB 500 An Act making capital and other appropriations;
and providing for an effective date.
HB 500 was HELD in Committee for further
consideration.
HB 541 An Act providing for the issuance of general
obligation bonds in the amount of $148,500,000 for
the purpose of paying the cost of design and
construction of state correctional facilities; and
providing for an effective date.
HB 541 was postponed for a hearing at a latter
date.
SB 136 An Act making appropriations for capital project
matching grant funds and to capitalize funds;
making, amending, and repealing capital
appropriations; and providing for an effective
date.
HCS CS SB 136 (FIN)am (brf sup maj fld) was
reported out of Committee with a "do pass"
recommendation.
SB 141 An Act relating to legislative ethics; and
providing for an effective date.
SB 141 was postponed for a hearing at a latter
date.
SB 152 An Act relating to geographic differentials for
the salaries of certain state employees who are
not members of a collective bargaining unit;
relating to periodic salary surveys and
preparation of an annual pay schedule regarding
certain state employees; relating to certain state
aid calculations based on geographic differentials
for state employee salaries; and providing for an
effective date.
SB 152 was postponed for a hearing at a latter
date.
SB 215 An Act streamlining the functions of state
government, including authorizing the commissioner
2
of fish and game to award grants for certain
resource activities; allowing agents selling fish
and game licenses and tags to retain certain
compensation; authorizing the Department of Health
and Social Services to award grants for certain
services for developmentally delayed or disabled
children; relating to rabies control and
administration of flour and bread standards by the
Department of Environmental Conservation;
repealing the Athletic Commission, the regulation
of boxing and wrestling, the certification of
professional geologists, and the Water Resources
Board; repealing certain filing statements and
bonds for enforcement and collection of certain
taxes; and providing for an effective date.
SB 215 was postponed for a hearing at a latter
date.
SB 270 An Act relating to juveniles; relating to the
jurisdiction of juvenile courts; relating to the
release of juveniles; and relating to records
concerning juveniles.
SB 270 was postponed for a hearing at a latter
date.
SCR 23 Relating to long range financial planning.
SCR 23 was postponed for a hearing at a latter
date.
SENATE BILL 136
"An Act making appropriations for capital project
matching grant funds and to capitalize funds; making,
amending, and repealing capital appropriations; and
providing for an effective date."
HOUSE BILL 500
"An Act making capital and other appropriations; and
providing for an effective date."
Co-Chair Hanley explained that there were five deleted
sections from the proposed house bill included in the
handout titled Amendment to 2D CS SB 163 (FIN) am (brf sup
maj fld). [Copy on file]. The section numbers are #36,
JOHN WALSH, STAFF, REPRESENTATIVE RICHARD FOSTER, spoke to
the differences between the two bills. The changes occur in
3
Section #2(a), adding a citation reference for the City and
Borough of Sitka high school project. Section #7 has a
language change, recommended by the sponsor and would
include Hanshah Junior High School. He continued, Section
Municipality of Anchorage, replacing the "G" version.
Section #11(c) would provide for a new reference funding for
the Special Olympic citation. Section #22(b) will provide a
new title; Section #26(b) changes the lapse date.
Section #27(e) also changes a lapse date; Section #32(a)
would delete a reference to AS 18.26.260. Mr. Walsh
summarized that Sections #43 (a, b, c, d & e) were
replacements from the previous draft. Section #51 (a, b &
c) provide new inserts. Sections #53 through #60 would be
new sections.
Representative Brown declared a "conflict of interest"
noting that she is a Special Olympics board member and that
they have several reappropriations included in the proposed
legislation. Representative Mulder echoed that he too sat
on that board.
Representative Brown referenced Page 4, Line 30, requesting
"and software" be inserted following "computers".
Representative Martin asked if there was a difference
between needing a computer versus software. Representative
Brown replied that the proposed plan would allocate $12
thousand dollars for computer equipment and $3 thousand
dollars for software. Representative Brown MOVED to adopt
the amendment. There being NO OBJECTION, it was adopted.
Representative Brown referenced Section #18, Page 8, asking
who requested the statewide reappropriation. Mr. Walsh
explained that amendment was requested by the Mat-Su
delegation. The original appropriation had been general
fund dollars.
Representative Navarre noted that the appropriation had been
made in 1989 and was not extended. Co-Chair Hanley
understood that if any of the funds had been spent, the
appropriation would then an ongoing appropriation, with a
five year lapse for capital projects.
FRED FISHER, FISCAL ANALYST, LEGISLATIVE FINANCE DIVISION,
interjected that capital appropriations do not lapse until
the project is completed.
KELLY HUBER, STAFF, SENATOR RICK HALFORD, clarified that the
Department of Transportation and Public Facilities (DOTPF)
had contacted Senator Halford and Senator Green informing
them that the project had been completed. The
4
reappropriation request was submitted with those projects
included.
Representative Navarre questioned when a project was
completed, how were the remaining funds distributed. Mr.
Fisher explained that the agency should lapse the remaining
funds back into the general fund.
Representative Brown elaborated that it has not been a
policy in the past to have individual district delegations
reappropriating statewide pieces within the budget. Co-
Chair Hanley reiterated that DOTPF had made the request.
ANNALEE MCCONNELL, DIRECTOR, DIVISION OF MANAGEMENT AND
BUDGET, OFFICE OF THE GOVERNOR, offered to provide
information regarding the request.
BRETT HUBER, STAFF, SENATOR LYDA GREEN, agreed that the
projects had been submitted by DOTPF as referenced in the
back-up materials. He added, Senator Green's office then
asked which projects would be appropriate for the remaining
funds. The Department, through Margaret Holland's office,
contacted Senator Green's office with a list of suggested
projects.
Representative Brown questioned the expenditures referenced
on Page 11, Line 6. Representative Therriault replied that
those funds represented a portion of the past capital budget
monies for the Interior delegation. The proposed language
would broaden the scope so as to make a purchase from the
Monroe foundation. Co-Chair Hanley commented that he had
prepared an amendment to correct that. Discussion followed
among Committee members regarding Section #22.
Representative Brown spoke to Section #23.
JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES, explained that
last year, there was a section in the reappropriation bill
similar to the request included in Section #23. Those funds
had been appropriated to "other" items last year, discovered
when Senator Miller's office contacted the Department. The
request would not change from last year, although would
reverse the decision. The language was too broad last year.
Representative Brown spoke to Section #32, Page #17,
questioning why the reappropriation continued.
CHRIS CLARKE, STAFF, REPRESENTATIVE CARL MOSES, explained
that there had been $28 thousand dollars remaining in that
account. Mr. Clarke understood that the original
5
reappropriation was a district appropriation.
Representative Brown reiterated her concern with individual
legislators reappropriating money from the department's
statewide projects. She asked if DOT&PF had been involved
in that decision. Mr. Clarke replied that Senator Hoffman's
office had been advised.
Representative Brown spoke to Page 19, Section #35,
appropriation to the Legislative Council. Mr. Walsh noted
that the request had originated within the Legislative
Council.
Representative Brown asked the total amount of
reappropriation funding included in the proposed
legislation. Mr. Walsh thought it was around $800 thousand
dollars.
In response to Representative Brown's query to Page 20,
Section #41, Mr. Walsh advised that the request had been
provided by Representative Williams and Senator Taylor.
GARY HAYDEN, SYSTEM DIRECTOR, MARINE HIGHWAY SYSTEM,
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES, advised
that the appropriation came from the Alaska Marine Highway
Fund. The building currently being used for administrative
functions is being considered by the City and Borough of
Juneau (CBJ) for school expansion. Representative Brown
asked if DOTPF supported the appropriation. Mr. Hayden
stated they did not.
Representative Brown MOVED to delete Section #41.
Representative Kelly OBJECTED.
Co-Chair Hanley recommended deleting questionable sections
on the House Floor. Representative Brown pointed out that
generally amendments to an appropriation bill are not
allowed on the floor. She asked the policy originally
intended for submitting a reappropriation. Mr. Walsh
informed Committee members that a memo had been circulated,
requesting that the reappropriation request stay within the
districts appropriations. Representative Brown WITHDREW the
MOTION to amend, agreeing to making the motion on the House
floor. There being NO OBJECTION, it was withdrawn.
Representative Navarre MOVED to delete Section #41. Co-
Chair Hanley responded that he supported deletions to any
individual legislators statewide recommendations. Co-Chair
Hanley questioned other sections of the legislation which
addressed those concerns. Mr. Walsh noted Section #53 was
one. Representative Navarre WITHDREW the MOTION to delete
Section #41. Co-Chair Hanley perused the bill for similar
reappropriation requests.
6
Mr. Walsh added that Section #42 was an authority fund which
has not been used to date.
(Tape Change, HFC 96-164, Side 2).
Representative Brown asked who sponsored the reappropriation
requested in Section #43. Ms. McConnell spoke to Section
a plan for the advocacy opening ANWR. She recommended that
Section (e) be removed.
Representative Navarre questioned Section #44(b) and
requested a list of those expenditures. Representative
Brown advised that Section #44 (a) & (b) were unrelated.
Mr. Walsh responded that the sponsor had requested that they
be submitted together.
Representative Brown referenced Section #47 and asked what
was meant by "agency realignment and space consolidation".
Mr. Walsh deferred that question to Legislative Affairs.
Co-Chair Hanley commented that the lease on the Goldstein
Building was about the expire.
Representative Mulder noted that he had requested that
Section #48 be added in order to provide greater flexibility
to the Department of Corrections for more efficient
operation. He pointed out that the Department had been
allowed a carry forward from last year. Representative
Brown questioned limiting the use of those funds for
community residential centers. Representative Mulder
replied that decision would match considerations made by the
Criminal Justice cabinet to encourage half way house beds.
Ms. McConnell interjected that the Department would prefer
not to have the restriction recommended in Section #48,
requesting instead the carry-forward.
Representative Mulder MOVED to WITHDRAW Section #53. He
stated that he had been misinformed regarding the projects
which that money could be used for.
Representative Brown referenced Section #54. Mr. Walsh
stated those funds would be used by Alaska Industrial
Development and Export Authority (AIDEA) for development of
a mine near Crooked Creek. Ms. McConnell stated that the
Administration does not support the request; the bond rating
has not gone through the normal process. Representative
Brown added that Section #54 does not fit the proposed
policy and is not a reappropriation.
Representative Navarre questioned the inclusion of Section
7
this in conjunction with Representative Green.
NICO BUS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF NATURAL RESOURCES, stated that this was AOGGC
money; at the time that it was appropriated, AOGGC was part
of the Department of Natural Resources (DNR).
Representative Therriault understood that the funds were
still in DNR budget, having not been spent for two years.
Ms. McConnell advised that all departments are responsible
to report to OMB regarding lapsed fund amounts.
Co-Chair Hanley asked Representative Therriault if back-up
was available indicating that Section #22 was a district
appropriation request.
NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF
MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, commented on
the proposed amended legislation. She explained that
Sections #30 & #31 address communities in the capital
matching grants program. She noted that the language had
been duplicated. Section #34 would provide for extension of
the lapse date on the Science and Technology grants.
Co-Chair Hanley recommended incorporating the discussed
amendment to 2D CS SB 136 (FIN) am (brf sup maj fld),
deleting Sections #18, #32(b), #41, #42, #53, #54, #55, #31,
Representative Parnell MOVED to adopt Amendment #1, 9-
GH2034\G.7, Cramer, 5/2/96, which would reappropriate money
within the Anchorage school districts to Taku Elementary
School. [Copy on file]. There being NO OBJECTION, it was
adopted.
Representative Martin MOVED to adopt Amendment #2, 9-
GH2034\M.2, Cramer, 5/4/96, appropriating money from the
Ptarmigan Elementary safety zone light to the Department of
Administration. [Copy on file]. There being NO OBJECTION,
it was adopted.
(Tape Change HFC 96-165, Side 1).
Ms. Slagle spoke to Amendment #3. [Copy on file]. The
funds would be used for the back-log of "other" cases,
addressed in Subsections (a) & (b). The Department of
Commerce and Economic Development (DCED) has requested an
extension for program receipt authorization. She indicated
that the two sections had been added through the Governor's
Office to assist the Division of Elections equipment needs.
Representative Martin MOVED to adopt Amendment #3. There
8
being NO OBJECTION, it was adopted.
Representative Therriault MOVED to adopt Amendment #4.
[Copy on file]. Co-Chair Hanley OBJECTED because it was a
regional district appropriation. Representative Therriault
provided the Committee with a handout explaining the
amendment. [Copy on file].
THOMAS BRINGHAM, DIRECTOR, DIVISION OF STATEWIDE PLANNING,
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES, stated
that the effect of the amendment would delay the Whittier
project by approximately one year. He added that the
Department does not support the reallocation. Two design
contracts have gone to bid. Approximately, $25 million
dollars of ISTEA money is available for the project.
Representative Therriault spoke in support of Amendment #4
and provided an in depth analysis of the accompanying
material.
Representative Kohring voiced support for Amendment #4,
pointing out that it would provide for repairs and
renovations to school facilities throughout the State of
Alaska.
Mr. Bringham noted that the amendment would implement
impacts to the Department by delaying construction on the
Whittier Road, depleting that account by $2 million dollars.
Those funds would need to be replaced with highway funds.
Other projects would then have to be delayed.
Representative Therriault suggested that he would be willing
to reduce the requested amount from $10 million dollars to
$5 million dollars in order to make the project work.
Representative Therriault MOVED to cut the amount proposed
in Amendment #4 in half. Representative Martin OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Parnell, Therriault, Kelly.
OPPOSED: Navarre, Brown, Grussendorf, Kohring,
Martin, Mulder, Hanley, Foster.
The MOTION FAILED (3-8).
A roll call was taken on the MOTION to adopt Amendment #4.
IN FAVOR: Therriault, Kelly, Kohring, Navarre.
OPPOSED: Parnell, Brown, Grussendorf, Martin,
Mulder, Foster, Hanley.
The MOTION FAILED (4-7).
Representative Brown explained that Amendment #5 was part of
9
the Governor's capital budget request and is a "high"
priority of the Administration. Ms. McConnell agreed that
the amendment was the "highest priority" for the
Administration of items which currently are not included in
the budget draft. Ms. Clarke added that construction of the
Johnson Youth Center Treatment Unit was also a high priority
for the Department of Health and Social Services.
Representative Grussendorf pointed out that the facility has
only eight beds and the amendment would provide an
additional twenty beds.
Representative Brown MOVED to adopt Amendment #5. Co-Chair
Hanley OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Therriault, Brown, Grussendorf, Navarre.
OPPOSED: Kelly, Kohring, Martin, Mulder, Parnell,
Hanley, Foster.
The MOTION FAILED (4-7).
Representative Brown spoke to Amendment #6. [Copy on file].
Amendment #6 would provide a deletion to the Department of
Fish and Game's, "Trapper, hunter education material and
newsletter" component. She noted that the Legislature
appropriated $200 thousand dollars in FY95 for a similar
project. Representative Therriault noted that the existing
video does not cover the same concepts proposed for the new
video. Representative Brown pointed out that the request
had been added to the budget proposal on the Senate side.
Representative Kelly corrected that the request had been
submitted by the Department of Fish and Game.
Representative Grussendorf noted that the Department is
trying to educate trappers to use more humane ways of catch
and kill.
Representative Brown MOVED to adopt Amendment #6.
Representative Grussendorf OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Brown, Martin.
OPPOSED: Grussendorf, Kelly, Kohring, Mulder,
Navarre, Parnell, Therriault, Hanley,
Foster.
The MOTION FAILED (2-9).
Representative Brown MOVED to adopt Amendment #7. [Copy on
file]. Co-Chair Hanley OBJECTED.
10
LAURIE OTTO, DEPUTY ATTORNEY GENERAL, CRIMINAL DIVISION,
DEPARTMENT OF LAW, stated that funding Amendment #7 was a
high priority for the Administration, included in a set of
revenue bonds. The criminal justice system is completely
dependant on computerized records. Systems currently used
are obsolete; she emphasized many departments are dependent
upon the system for accurate records.
A roll call was taken on the MOTION.
IN FAVOR: Navarre, Brown, Grussendorf.
OPPOSED: Kohring, Martin, Mulder, Parnell,
Therriault, Kelly, Foster, Hanley.
The MOTION FAILED (3-8).
Representative Brown MOVED to adopt Amendment #8. [Copy on
file]. She understood that people living in that area do
not want the highway paved; the amendment would provide a
deletion to the expenditure requested. Representative
Therriault pointed out that the project had been added on
the Senate side. The Commissioner has indicated that only
one of the projects could be completed. Co-Chair Hanley
OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Navarre, Therriault, Brown, Grussendorf,
Kohring.
OPPOSED: Martin, Mulder, Parnell, Hanley, Foster.
Representative Kelly was not present for the vote.
The MOTION FAILED (5-5).
(Tape Change HFC 96-166, Side 2).
Amendment #9 compiles requests from the Office of the
Governor, Division of Budget Review. [Copy on file].
Ms. Slagle stated that Section #1, Department of
Administration (DOA) was a resubmitted request in the amount
of $95 thousand dollars for the public defender agency.
Section #2, also, was a resubmission which had been removed
on the Senate floor. The change would be a funding shift
for payment to revenue sharing for a Native village, Kluti-
Kaah.
Section #3 would provide $500 thousand dollars program
receipts to pay for raw materials and other related costs of
the correctional industries program.
11
Section #4, a new request, would provide for $50 thousand
dollars in program receipts for payment of additional costs
to the State museum programs. Section #5, Department of
Law, (a) provides for a listing of judgments previously
submitted by the Department. Subsections (b) & (c) are new
requests by the Department of Law. Co-Chair Hanley asked if
these were judgments or settlements pending against the
State.
RICHARD PEGUES, DIRECTOR, ADMINISTRATIVE SERVICES DIVISION,
DEPARTMENT OF LAW, replied that they were both settlements
and judgments; most of the accounts are accruing interest.
He added that settlements are contingent on the
appropriation.
Representative Navarre asked if Subsection (c) had been
settled. Ms. McConnell responded that section was a
repeated request for Alaska Legal Services. Discussion
followed between Ms. McConnell and Committee members
regarding Alaska Legal Services.
Ms. Slagle noted that Section #6, Department of
Transportation and Public Facilities (DOT&PF) was a repeat
of the Copper River highway restoration request. Section
University contracts. Section #8 addresses miscellaneous
claims and Section #9 provides for the ratification.
Co-Chair Hanley suggested moving all the new sections;
Section #3, Section #4, Section #5 (a) & (b), Section #8 and
Section #9.
Representative Mulder MOVED the language referenced by Co-
Chair Hanley. There being NO OBJECTION, the new sections
were adopted into the supplemental budget request.
Co-Chair Hanley MOVED TO RESCIND action on failure to adopt
Section #4(b). There being NO OBJECTION, it was rescinded.
Co-Chair Hanley MOVED to delete Section #4(b). There being
NO OBJECTION, it was deleted.
Representative Brown MOVED to adopt Section #7, contract
language for the University of Alaska. Co-Chair Hanley
OBJECTED. Following discussion on the contract
negotiations, Representative Brown WITHDREW the MOTION to
move Section #7.
Representative Navarre MOVED to adopt Section 5(c), the
Department of Law request for expanded funding to Alaska
Legal Services. Representative Mulder OBJECTED.
A roll call was taken on the MOTION.
12
IN FAVOR: Navarre, Brown, Grussendorf, Foster.
OPPOSED: Mulder, Parnell, Therriault, Kelly,
Kohring, Martin, Hanley.
The MOTION FAILED (4-7).
Representative Brown MOVED to adopt Section #1, Department
of Administration request for the public defender. Co-Chair
Hanley OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Navarre, Brown, Grussendorf, Foster.
OPPOSED: Mulder, Parnell, Therriault, Kelly,
Kohring, Martin, Hanley.
The MOTION FAILED (4-7).
Representative Navarre MOVED to adopt Section #2 (2),
Department of Community and Regional Affairs (DCRA),
Municipal Revenue Sharing. Co-Chair Hanley OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Brown, Grussendorf, Navarre, Foster.
OPPOSED: Parnell, Therriault, Kelly, Kohring,
Martin, Mulder, Hanley.
The MOTION FAILED (4-7).
Representative Brown requested further information regarding
the Copper River Highway.
SAM KITO, III, LEGISLATIVE LIAISON/SPECIAL ASSISTANT, OFFICE
OF THE COMMISSIONER, DEPARTMENT OF TRANSPORTATION AND PUBLIC
FACILITIES, stated that request resulted from a settlement
entered into with Department of Justice regarding the Copper
River Highway litigation. It includes several components,
plus litigation settlement costs. Representative Navarre
asked how much to date had been spent on the litigation.
Mr. Kito advised that the consequences of not funding the
settlement would place the State back in court with legal
costs mounting.
Representative Navarre MOVED to incorporated Section #6.
Representative Martin OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Brown, Grussendorf, Navarre, Parnell.
OPPOSED: Therriault, Kelly, Kohring, Martin,
Mulder, Foster.
13
Representative Hanley was not present for the vote.
The MOTION FAILED (4-6).
Representative Kohring MOVED to adopt Amendment #10. [Copy
on file]. Representative Mulder OBJECTED for purposes of
discussion. Representative Kohring explained that the
amendment would increase program receipts for low-income
housing weatherization.
JOHN BITNEY, ALASKA HOUSING FINANCE CORPORATION (AHFC),
DEPARTMENT OF REVENUE, provided more detail on the proposed
project, noting that anticipated federal receipts for the
program are declining. The amendment would bring the
federal receipt authority in line with what originally was
anticipated to be received. Representative Mulder WITHDREW
the OBJECTION. There being NO further OBJECTION, it was
adopted.
Co-Chair Hanley MOVED to adopt Amendment #10. [Copy on
file]. He stated that the two sections had been drafted
incorrectly. The amendment provides a technical correction.
There being NO OBJECTION, it was adopted.
Representative Brown MOVED to adopt Amendment #12. [Copy on
file]. The amendment would add $25 thousand general fund
dollars to the Statewide Library and Electronic Doorway
(SLED) appropriation.
KAREN REHFELD, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF EDUCATION, spoke to the need for the
requested funding addition. Representative Kelly OBJECTED.
A roll call was taken on the MOTION.
IN FAVOR: Brown, Grussendorf, Kohring, Navarre,
Foster.
OPPOSED: Kelly, Martin, Mulder, Parnell,
Therriault, Hanley.
The MOTION FAILED (5-6).
Mr. Walsh spoke to Amendment #13 by Representative Foster.
[Copy on file]. The amendment would delete Section #5 which
had been addressed through previous language.
Co-Chair Foster MOVED to adopt Amendment #13. There being
NO OBJECTION, it was adopted.
Mr. Walsh spoke to Amendment #14. [Copy on file].
14
TOM WRIGHT, STAFF, REPRESENTATIVE IVAN IVAN, explained that
there had been a drafting error and that the concerns had
been adopted on the Senate floor but not incorporated. Co-
Chair Foster MOVED to adopt Amendment #14. There being NO
OBJECTION, it was adopted.
Representative Kelly spoke to Amendment #15. [Copy on
file].
(Tape Change HFC 96 - 166, Side 1).
Representative Kelly MOVED to adopt Amendment 15 (copy on
file). Amendment 15 would delete page 14, lines 17 - 18.
Ms. Slagle explained that the amendment would delete an
appropriation from the Fish and Game Fund for the assertion
of state's rights in litigation. She observed that the
request duplicates funding in the supplemental. She added
that $200.0 thousand dollars was lost for the Endangered
Species Act.
There being NO OBJECTION, Amendment 15 was adopted.
Representative Martin MOVED to adopt Amendment 16 (copy on
file). Amendment 16 would delete page 8, lines 6 - 8. He
explained that the amendment would transfer grants to the
Alaska Craftsman Home Program and the Energy Rated Homes of
Alaska from the Department of Community and Regional Affairs
and place them under the Alaska Housing Finance Corporation
(AHFC). He noted that an audit by the Legislative Budget
and Audit Committee showed problems with these programs.
TIM SULLIVAN, EXECUTIVE DIRECTOR, ALASKA CRAFTSMAN HOME
PROGRAM observed that the Alaska Craftsman Home Program and
the Energy Rated Homes of Alaska have been incorporated into
the State's budget since 1990. Both programs are private
non-profit corporations. He maintained that a lack of
service would result in a discomfort to the housing
industry. He noted that the Energy Rated Homes of Alaska
Program is housed within AHFC. He asserted that the
programs represent a good example of public\private
partnership. He observed that an audit by the AHFC of the
Energy Rated Homes of Alaska Program fund some disallowable
costs. A second private audit concluded that Energy Rated
Homes of Alaska had expended their funds in accordance with
the provisions of the grant from AHFC.
DAN FAUSKE, EXECUTIVE DIRECTOR, ALASKA HOUSING FINANCE
CORPORATION stated that AHFC did not audit Energy Rate Homes
of Alaska. He noted that AHFC audited Innovative
Communications. He stressed that the Corporation does not
15
have a contract with Energy Rate Homes of Alaska. He
maintained that AHFC supports the programs. He stressed
that public hearings concluded that the public wanted access
to stripper well monies and an open bid process. He noted
that the grant to Innovative Communications was cancelled.
It was a competitively awarded grant and could not be
transferred to another corporation.
Representative Mulder questioned if the programs are
supported by the home builders. Mr. Fauske stated that
there have been some questions on the funding. He stressed
that a private audit will be completed. He noted that the
audit has not been completed. He observed that the Alaska
Craftsman Home Program has not been audited. Energy Rated
Homes of Alaska had its own internal audit.
Representative Martin stressed that there should be an open
bid process.
Mr. Fauske stated that the grant under question was
competitively awarded to Innovated Communications. The
grant was cancelled before completion.
Co-Chair Hanley questioned if an independent auditor has
been suggested by the Attorney General's Office. Mr. Fauske
noted that discussions with the grantee occurred regarding
an independent auditor. Co-Chair Hanley noted that the
audit is under appeal. He asked if AHFC generally cancels
grants under appeal. Mr. Fauske stressed that there were
several complicating factors. He added that the Attorney
General's Office was involved in the process.
Mr. Fauske stated that AHFC is against designated grants.
Co-Chair Hanley noted that Alaska Craftsman Home Program has
received designated grants for many years. Mr. Fauske
observed that Energy Rated Homes of Alaska has not
previously received a designated grant. He added that the
Board of Directors for AHFC has determined that all AHFC
grants should be competitively bid.
Representative Brown noted that the programs have always
been under the Executive Budget Act.
Mr. Sullivan noted that the programs have had to comply with
the State's single audit act. He noted that the programs
have had to comply with federal audit requirements. He
added that both are private non-profit corporations. They
are both listed specifically in statute as compliance
methods for occupational licensing and rating thermal
standards. He maintained that this is the reason that they
have been line items in the budget.
16
Mr. Fauske reiterated that AHFC did not have a contract with
Energy Rated Homes of Alaska.
Representative Kohring noted that the programs are under
AHFC. He maintained that the programs are working.
Mr. Sullivan stressed that the programs were originally
developed under the Department of Community and Regional
Affairs. He noted that when energy programs were merged
with the Department of Community and Regional Affairs and
the Alaska State Housing Authority was merged with Alaska
Housing Finance Corporation the programs moved into AHFC.
He observed that the Alaska State Home Builder's Association
is on record in support of the transfer of Energy Rated
Homes of Alaska and Alaska Craftsman Home Program into to
Department of Community and Regional Affairs. He maintained
that the Department of Community and Regional Affairs is
better equipped to handle grants with private non-profit
corporation.
Representative Brown spoke against the amendment.
Representative Martin spoke in support of the amendment. He
stressed that the grants should be competitively bid.
Representative Mulder spoke against the amendment. He
stressed that the programs are working well.
A roll call vote was taken on the MOTION to adopt Amendment
16.
IN FAVOR: Kohring, Martin, Navarre
OPPOSED: Mulder, Parnell, Therriault, Brown, Grussendorf,
Kelly, Foster, Hanley
The MOTION FAILED (3-8).
Representative Mulder MOVED to adopt Amendment 17 (copy on
file). He explained that the amendment would insert on page
8, line 9: "The source of these funds shall be general
Stripper Well Oil Overcharge funds appropriated to Alaska
Housing Finance Corporation Projects in the Department of
Revenue"; deleted on page 20, line 8, "3.0 million dollars"
and insert $600.0 thousand dollars"; and delete page 20,
lines 10 - 14.
Mr. Fauske spoke against the amendment. He noted that
Stripper Well Oil Overcharge funds are restitution money
paid to the State of Alaska for overcharges to all residents
of the State. He noted that a committee was formed to
design a budget and an expenditure plan for the monies. He
observed that the amendment would tie up the funds so that
17
they could not be utilized for any other programs. He
emphasized that other competitive bidders in this line of
work have asked for access to bid some of the work.
Representative Mulder spoke in support of the Amendment 17.
He stressed that Energy Rated Homes of Alaska and Alaska
Craftsman Home Program are important programs that are
serving a constituency. He spoke in support of maintaining
a revenue stream for these programs. He maintained that
AHFC is seeking to put this $3.0 million dollars back into
the corpus of the Fund.
Mr. Fauske pointed out that they are federal receipts that
reside within the Corporation. Representative Mulder
stressed that the amendment would maintained the funds for
the future.
Representative Martin spoke against the amendment.
Mr. Fauske stressed that the Stripper Well Plan recognized
that the funds are finite. The Plan asks the Legislature to
request AHFC to review the activities to be conducted under
the Plan in order to assure that they serve the general
population without regard to income level. He noted that
the Plan was part of AHFC's budget.
Representative Martin expressed concern that Amendment 17
amounts to an exclusive contract to fund private non-profit
corporations.
Representative Mulder reiterated that the funding is finite.
Mr. Fauske stressed that the Plan would utilize the
remaining funds. Representative Mulder stressed that the
money can be appropriated to other programs in the future if
the legislature decides to redirect them.
Mr. Fauske stressed that AHFC is not opposed to the
programs. He emphasized that public comment demonstrated
the need for access to the dollars.
Representative Mulder asserted that the money will be saved
for the future.
Co-Chair Hanley summarized that $600.0 thousand dollars of
the $3.0 million would be used for designated grants to
Energy Rated Homes of Alaska and Alaska Craftsman Home
Program.
Mr. Fauske pointed out that the Energy Rate Homes and Alaska
Craftsman Home Programs could bid on the remaining money.
Representative Brown cited statutes which refer to the
Energy Rated Homes of Alaska and Alaska Craftsman Home
18
Programs. She spoke in support of the amendment.
A roll call vote was taken on the MOTION to adopt Amendment
17.
IN FAVOR: Brown, Navarre, Kelly, Mulder, Parnell,
Therriault, Foster
OPPOSED: Martin, Kohring, Hanley
Representative Grussendorf was absent from the vote.
The MOTION PASSED (7-3).
Representative Martin asked if the passage of Amendment 17
would delete funding for energy programs for Alaska.
JOHN BITNEY, STAFF, ALASKA HOUSING FINANCE CORPORATION noted
that the only stripper well monies expended are the two
designated grants under the Department of Community and
Regional Affairs. He observed that AHFC has $600.0 thousand
dollars in receipt authority designated to be transferred to
two designated grants under the Department of Community and
Regional Affairs. The statute still requires AHFC to have
the programs.
Representative Therriault MOVED to adopt Amendment 18 (copy
on file). He explained that the amendment would delete
"$6.0 million dollars" and insert "5.5 million dollars" on
page 23, line 7; and authorize $500.0 thousand dollars for
the Chena Hot Springs Road. He explained that the amendment
would transfer funding from the Denali Highway.
(Tape Change, HFC 96-166, Side 2)
SAM KITO III, SPECIAL ASSISTANT, DEPARTMENT OF
TRANSPORTATION AND PUBLIC FACILITIES clarified that the
Department is bound by federal requirements to comply with
the federal processes and planning requirements. He stated
that he did not know where the Chena Hot Spring road falls
under federal priorities. He noted that federal
authorization to receive and expend from project to project
can be reallocated if there is a shortage in a project.
Representative Therriault noted that $3.0 million dollars is
the estimated amount needed to complete the project. He
observed that part of the project was completed last fall.
He questioned if the project cost can be increased without
additional authorization.
Mr. Kito noted that authorization can be increased through
the Legislative Budget and Audit Committee in exchange for
decreased authority in another project.
19
There being NO OBJECTION, Amendment 18 was adopted.
Representative Brown MOVED to rescind the Committee's action
in failing to adopt Amendment 8. She explained that the
amendment would delete the balance of funds from the Denali
Highway resurfacing project. There being NO OBJECTION, it
was so ordered.
Co-Chair Hanley OBJECTED to the motion to adopt Amendment 8.
A roll call vote was taken on the MOTION.
IN FAVOR: Navarre, Therriault, Brown, Grussendorf, Kelly,
Kohring
OPPOSED: Parnell, Martin, Mulder, Hanley, Foster
The MOTION PASSED (6-5).
Representative Therriault MOVED to rescind the Committee's
action in failing to adopt Amendment 12. There being NO
OBJECTION, it was so ordered.
Representative Martin OBJECTED to the motion to adopt
Amendment 12. A roll call vote was taken on the MOTION.
IN FAVOR: Brown, Grussendorf, Navarre, Kelly, Kohring,
Mulder, Parnell, Therriault, Foster, Hanley
OPPOSED: Martin
The MOTION PASSED (10-1).
Co-Chair Hanley MOVED to adopt Amendment 19 (copy on file).
The amendment would extend the roll forward for the Arctic
National Wildlife Refuge education effort. There being NO
OBJECTION, it was so ordered.
Representative Martin requested that Alaska Housing Finance
Corporation projects remain open.
Co-Chair Hanley suggested that projects be reviewed to see
if they fit under categories that are appropriate.
Representative Brown asked if the legislation contains the
use of Alaska Housing Finance Corporation funds for non-
housing purposes.
Ms. McConnell noted that there are water/sewer projects that
would not be related specifically for housing. The whole
municipal water/sewer program is funded with funds from the
Alaska Housing Finance Corporation.
20
Ms. McConnell observed that the Department of Environmental
Conservation and Alaska Housing Finance Corporation (AHFC)
worked together to provide AHFC with information about the
projects.
Representative Martin expressed concern with funding for a
road and pipeline project in Petersburg.
Representative Grussendorf commented that the water source
in Petersburg is not adequate. He noted that the community
has recently received authorization for a $1.0 million
dollar federal grant. The state funding is needed to
complete the reservoir dam.
Ms. McConnell clarified that the Administration did not want
more than $53.0 million dollars in AHFC corporate receipts
to be used for these projects.
Representative Kohring noted that AHFC assumed some of the
responsibilities of the Department of Community and Regional
Affairs, including water and sewer needs related to
infrastructure.
In response to a question by Representative Brown, Ms.
McConnell noted that projects were added from the municipal
matching priority list.
Representative Navarre MOVED to incorporate the adopted
reappropriation and amendments into HCS CSSB 136 (FIN).
There being NO OBJECTION, it was so ordered. Representative
Navarre MOVED to report HC CSSB 136 (FIN) out of Committee
with individual recommendations.
ADJOURNMENT
The meeting adjourned at 4:20 a.m.
21
| Document Name | Date/Time | Subjects |
|---|