Legislature(2009 - 2010)HOUSE FINANCE 519
01/28/2010 09:00 AM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB300 || HB302 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| = | HB 300 | ||
| + | TELECONFERENCED | ||
HOUSE FINANCE COMMITTEE
January 28, 2010
9:08 a.m.
9:08:03 AM
CALL TO ORDER
Co-Chair Hawker called the House Finance Committee meeting
to order at 9:08 a.m.
MEMBERS PRESENT
Representative Mike Hawker, Co-Chair
Representative Bill Stoltze, Co-Chair
Representative Allan Austerman
Representative Mike Doogan
Representative Anna Fairclough
Representative Neal Foster
Representative Les Gara
Representative Reggie Joule
Representative Mike Kelly
Representative Woodie Salmon
MEMBERS ABSENT
Representative Bill Thomas Jr., Vice-Chair
ALSO PRESENT
Mary K. Hughes, Regent, University of Alaska; Mark Hamilton,
President, University of Alaska.
PRESENT VIA TELECONFERENCE
None
SUMMARY
HB 300 APPROP: OPERATING BUDGET/LOANS/FUNDS
HB 300 was HEARD and HELD.
HB 302 APPROP: MENTAL HEALTH BUDGET
HB 302 was HEARD and HELD.
HOUSE BILL NO. 300
"An Act making appropriations for the operating and
loan program expenses of state government, for certain
programs, and to capitalize funds; making supplemental
appropriations; making appropriations under art. IX,
sec. 17(c), Constitution of the State of Alaska; and
providing for an effective date."
HOUSE BILL NO. 302
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
9:08:11 AM
Co-Chair Hawker explained that the University budget is
managed by a subcommittee. He stated that today's House
Finance Committee (HFC) meeting recognizes the priority with
which the committee holds the University within the state.
He noted that the meeting is held in the format of a full
finance committee meeting meaning that the content is
recorded and the meeting is broadcasted. Following today's
meeting, the subcommittee will be scheduled and called by
Representative Fairclough directly to pursue the
University's budget. One change this year includes
incorporating the University's Board of Regents (BOR) as the
policy body behind the University.
9:11:31 AM
Acting Chair Fairclough commended the members of HFC for
encouraging the process within this committee. She explained
that today's meeting includes a high level overview and the
subcommittee will address greater details later.
MARY K. HUGHES, REGENT, UNIVERSITY OF ALASKA, expressed
thanks for the leadership of the committee as it allowed for
a necessary process. The role of the BOR is constitutionally
mandated. The board members are gubernatorial appointments
and confirmed by the legislature. She insisted on
collaboration between the legislature and the BOR.
9:16:02 AM
Ms. Hughes noted that the BOR functions as a policy board.
The board meets a minimum of nine times each year, often for
budget related issues. The budget process is initiated one
year prior to submission to the governor.
Ms. Hughes shared that she was born on Kodiak Island and
graduated from West Anchorage High and the University of
Alaska. She noted that she was appointed by Governor
Knowles. Her name was presented to the legislature by
Governor Murkowski and then again by Governor Palin. She
opined that the gubernatorial process is very humbling and
makes a person feel honored. She stated that the BOR members
are thankful for the trust given to them. She mentioned
Fairbanks and her appreciation of the campus.
9:24:02 AM
Ms. Hughes discussed the University system. The University
is comprised of three units with sixteen total campuses. The
chancellors are similar to municipal mayors because they
control their individual campus. The campuses are community
outlets. The directors are outstanding leaders who report to
the chancellors. In budget processes, the chancellor decides
how to prioritize.
9:28:59 AM
Co-Chair Hawker reviewed the statements regarding structural
organization and policy within the University. He mentioned
three separately accredited units known as the Major
Administrative Units (MAU) that comprise the University of
Alaska. He summarized that past conversations bring
questions about the autonomy of the units. He opined that
the autonomy is tempered as one moves up the hierarchical
command and control structure. The level of autonomy is
often described as open warfare against the campuses. He
asked to what degree the autonomy of the campuses is
exercised and healthy. He explained that he receives
multiple calls regarding divisive opinions among the
administrative units. This issue was the foundational point
behind the meeting today.
9:31:49 AM
Ms. Hughes responded that the University has separate
accredited MAUs and the way in which a chancellor portrays
himself or herself depends on personality and experience.
The University wants the chancellors and their respective
groups off campuses to represent their group in a strong
decisive fashion. The regents attempt to help the
legislature prioritize appropriate action. Because the needs
of the campuses differ, there will be those who disagree
with the priorities expressed by the regents. She opined
that sometimes disagreement is good and the regent's job is
to prioritize and bring requests to the legislature. She
gave a pertinent example including the request for only one
capital project this year to simplify the process. She
explained that the individual chancellors do not
collectively agree with the request.
9:35:16 AM
Co-Chair Hawker appreciated the passionate response. He
expected diversity within the university system. He
referenced Part 3 of a Legislative Budget and Audit (LB&A)
report stating that the University lacks a coordinated and
cohesive approach, is not student centric, lack of
incentives exist for MAUs to collaborate, requires
improvement in efficiency and effectiveness. He noted that
campuses are institution centric versus student centric. The
audit group identifies best management practices and states
that the autonomy lacks the collective vision and the
leadership to take those strong diverse opinions and
management units and effectively manage them for the best
investment result.
9:38:52 AM
Ms. Hughes responded that distance education provides one
example, but with 16 campuses, some disagreement to the
approach warranted is often seen. She agreed that a
coordinated effort in distance learning has been discussed.
Distance learning is a large item in its popularity. She
mentioned Karen Purdue as the central health program
developer, leading to the joke that the University needs a
"Karen Purdue" for the distance program. She noted that the
University does understand the audit and the President's
administration agrees with the audit. She stated that
legislative audits always help.
9:41:30 AM
Co-Chair Hawker noted that the discussion about the distance
education program is simply illustrative of the greater
issue of the balkanization of the University. He asked if
this balkanization delivers the highest quality results for
the investment made.
Acting Chair Fairclough suggested that the topic be tabled
for a future meeting.
Co-Chair Stoltze observed the perceived nostalgia regarding
the centralized campus directing affairs for the rest of the
state.
9:46:35 AM
Co-Chair Stoltze mentioned that he had one nephew attending
the University of Anchorage who only has one class on campus
due to severe classroom shortages.
Representative Gara expressed some frustration about the
turf war within the University. He opined that the campus is
in Fairbanks is a flagship campus. He appreciated the
legislative liaison, because in the past information was
gleaned only from the regent's meetings. He asked about the
needs based financial aid program. He asked if this was a
regent's proposal including an actual plan.
9:48:57 AM
Ms. Hughes explained that the regents passed a resolution in
support of needs-based plan. She noted that the regents are
proponents of the needs-based plan. One resolution was
passed supporting the governor's plan.
Representative Gara asked if there was a plan or simply a
needs-based concept.
9:50:10 AM
MARK HAMILTON, PRESIDENT, UNIVERSITY OF ALASKA, responded
that the University would not administer the plan although
they do support it.
Representative Gara remembered one study performed by the
University known as the Lumina study about the cost and
implementation of a needs-based plan. Mr. Hamilton responded
that the study was greater than six years old. He explained
that the study was not a plan, but instead an exploration of
need.
Acting Chair Fairclough noted time constraints for today's
meeting.
Ms. Hughes stated that the University's operating budget
reflects the regent's desires to continue assisting
education for Alaskans in all job related areas. She
expressed that especially teacher education must be a
priority. She noted the governor's budget and the plan for
$37.5 million for the next five years, which pleases the
BOR. A large portion of the funds will go to the University
of Alaska Anchorage (UAA) to rehabilitate the science
building, which professors and staff vacated. She noted the
"blue book" or the "University of Alaska Governor's Proposed
FY2011" (Copy on File).
9:54:50 AM
Ms. Hughes explained that the BOR decided to agree on one
capital request, which led to some disagreement amongst
campuses. She remembered the December meeting of the BOR
where five members of the community testified with respect
to the UAA sports center. She noted that the planning funds
for the UAA arena have been available for approximately 18
months. The BOR asked the university planners to concentrate
on design and engineering studies. A site has been selected
and a subcommittee appointed to finish the engineering
design for the UAA sports center.
9:58:52 AM
Ms. Hughes noted that the financing is aided by private
corporations and this financial plan will be part of the
committee's work product. She noted that Wells Fargo
presented another issue. She explained that the BOR learned
from the Integrated Science Building that the renovation
project is not yet finished. The regents believe that having
community support is very helpful. She stated that she
wanted to provide the committee with accurate numbers and a
good plan.
Acting Chair Fairclough stated that a discussion on
maintenance for University buildings will occur during the
subcommittee process.
10:02:24 AM
Co-Chair Stoltze noted that members are hesitant to get
involved as it might hamper the ability to advocate. He
understood that the members believed that involvement in a
task force might prevent the ability to act. He stated that
the members considerately declined the invitation to
participate in the task force. Ms. Hughes countered that the
members did not decline the invitation. Co-Chair Stoltze
argued that the mayor and other prominent individuals
declined the invitation.
Acting Chair Fairclough noted that she would prefer to look
deeper into the issue at a future time. She noted that the
subcommittee would invest time exploring these important
issues.
10:04:38 AM
Mr. Hamilton considered it an insult to the members of the
BOR that he has worked with for twelve years, to suggest
that they are "interior centric." He agreed that internecine
warfare existed within the University and he stated that it
was because the BOR is successful in engaging their own
regional representatives and overturning the express
priorities of the BOR. The university requires help from the
legislature. The various regents have every right to talk
with their legislators about their needs. The BOR clearly
lays out a priority, which has been overturned by regional
activities. The result is that 80 percent of new
construction has occurred in Anchorage. He commended the
committee on getting the BOR involved for the purpose of
education. He stressed that the University is an institution
of goodness. Many wonderful programs come before the
President and the BOR and some must be declined.
Mr. Hamilton stated that the current status of the
University is one of fiscal crisis. Student head count is up
4.3 percent, which is the largest increase seen in many
years. Alaska native student enrollment is up 17 percent.
First time freshmen are up 15 percent and the university has
463 new Alaskan scholars, the largest new group seen in the
history of the University. He mentioned that John Pugh has
provided a tremendous source of information. He commended
the wonderful programs that allow sufficient involvement and
retention of students.
10:08:26 AM
Mr. Hamilton continued that funding of the University of
Alaska by the legislature coincided with his arrival to the
state. Since then, the number of high school graduates in
the state attending the University of Alaska has risen from
40 to 63 percent. Private donations have increased by 75
percent. Federal funding has increased by $70 million. For
the last 12 years, the University of Alaska has been
marginally favored by the legislature. He provided the
statistic that 47 percent of University of Alaska students
graduated during his time as President and that is due to
funding from the legislature. He remembered that the initial
request was made when oil was $9 per barrel and yet the
legislature chose to invest. He opined that the legislature
made the right call.
10:11:39 AM
Mr. Hamilton projected a 4 percent gain in the next ten
years. He opined that the gain might indeed be greater. He
provided a statistic from 1960 that only 40 percent of
children were born in the state. Today the statistic is 70
percent providing a more stable population. The University
is well situated for continuing research, especially with
the governor's budget for the life sciences building.
10:14:16 AM
Representative Foster noted that he received his second
degree from the University of Alaska. He commended the
efforts of the University on retention efforts.
Mr. Hamilton elaborated about specific programs that add to
graduation potential. Simply attending the Regional Alaskan
Honors Institute (RAHI) more than doubles the probability
that the individual will graduate. He noted that the
University has 4300 Alaska native students attending. He
admitted that the retention rate remains lower than desired,
but has continued to advance for more than a decade.
Mr. Hamilton addressed distance education. He explained that
the courses respond to need and are decentralized. The
question exists about formalizing this form of education at
a cost. The BOR realized the priority prior to the LB&A
audit. In ten years the University has four times as many
student credit hours delivered by distance education,
equaling a 400 percent increase in ten years. He considered
it an honor to work with academe. He stated that he has
attended approximately 100 commencement exercises. He highly
recommended the committee members attend a commencement
exercise.
10:19:21 AM
Mr. Hamilton stated that the University serves Alaska native
students. Twenty percent of the student body is comprised of
Alaska natives.
Ms. Hughes asked if Ms Rizk should provide the budget
overview. Acting Chair Fairclough stated that the overview
will be postponed.
Representative Kelly expressed profound thanks to Mr.
Hamilton. He believed that Mr. Hamilton was the most
untraditional candidate to be placed in his role. He
commended Mr. Hamilton for his work with the University's
nursing program.
Acting Chair Fairclough echoed the comments of
Representative Kelly.
10:24:30 AM
Acting Chair Fairclough noted that the "Governor's Proposed
Fiscal Year 2011 Operating and Capital Budget Request" (Copy
on File) or the "blue book" is the governor's proposal. She
expressed thanks to the University for providing the budget
in a form that is traditionally addressed by the
legislature. The "red book" is found online at the
University system, which is the regent's overall submission
to the governor. She noted that a short description of the
"red book" was provided in the committee packet which
includes a high level comparison allowing committee members
to have conversations about the issue.
10:26:53 AM
Representative Kelly commended Co-Chair Hawker for his work
in compiling this "blue book" and the gathering of issues
and pertinent information.
Acting Chair Fairclough echoed the comments of
Representative Kelly. She thanks the President for his
service to the country the state. She noted that the
university's loss will be mourned.
10:29:29 AM
Co-Chair Hawker stated that the subcommittee process will
continue in a forum chaired by Representative Fairclough
next Tuesday.
ADJOURNMENT
The meeting was adjourned at 10:30 AM
| Document Name | Date/Time | Subjects |
|---|---|---|
| FY11 Bluebook.pdf |
HFIN 1/28/2010 9:00:00 AM |
University of Alaska Overview |
| Overview UofA Budget Comparison.pdf |
HFIN 1/28/2010 9:00:00 AM |