Legislature(2011 - 2012)HOUSE FINANCE 519
03/14/2012 08:30 AM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB284 || HB285 | |
| HB250 | |
| HB358 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 250 | TELECONFERENCED | |
| + | HB 358 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 284 | TELECONFERENCED | |
| += | HB 285 | TELECONFERENCED | |
HOUSE FINANCE COMMITTEE
March 14, 2012
8:51 a.m.
8:51:40 AM
CALL TO ORDER
Co-Chair Thomas called the House Finance Committee meeting
to order at 8:51 a.m.
MEMBERS PRESENT
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas Jr., Co-Chair
Representative Anna Fairclough, Vice-Chair
Representative Mia Costello
Representative Mike Doogan
Representative Bryce Edgmon
Representative Les Gara
Representative David Guttenberg
Representative Reggie Joule
Representative Mark Neuman
Representative Tammie Wilson
MEMBERS ABSENT
None
ALSO PRESENT
Representative Lance Pruitt, Sponsor; Dirk Craft, Staff,
Representative Lance Pruitt.
SUMMARY
HB 250 EXTEND RENEWABLE ENERGY GRANT FUND
HB 250 was SCHEDULED but not HEARD.
HB 284 APPROP: OPERATING BUDGET/LOANS/FUNDS
CSHB 284(FIN) was REPORTED out of committee with
a "do pass" recommendation.
HB 285 APPROP: MENTAL HEALTH BUDGET
CSHB 285(FIN) was REPORTED out of committee with
a "do pass" recommendation.
HB 358 ANWR ADVERTISING CONTRACT
HB 358 was HEARD and HELD in committee for
further consideration.
HOUSE BILL NO. 284
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs, capitalizing funds, amending
appropriations, and making reappropriations; and
providing for an effective date."
HOUSE BILL NO. 285
"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."
8:51:51 AM
Co-Chair Thomas reported that the amended operating budget
was $31,044,700 in general funds below the governor's
amended request; in all funds, $77,683,700 was below the
governor's amended request. He thanked the committee for
helping to slow the growth of government. The agencies'
general fund portion of the budget was 3.4 percent larger
than the current year. In total the government was
investing $6.272 billion in general funds and $9.49 billion
in all funds.
Co-Chair Stoltze MOVED to ADOPT proposed committee
substitute HB 284 (FIN), Work Draft CS 27-GH2599\T (Bailey
3/13/12) as a working document. There being NO OBJECTION is
so ordered.
Co-Chair Stoltze MOVED to report CSHB 284(FIN) out of
committee with individual recommendations.
Representative Gara OBJECTED. He thanked Vice-chair
Fairclough and the Governor for discovering federal money
to help fund much needed housing for victims of domestic
violence. He felt it to be a very positive move.
Representative Gara WITHDREW his objection. There being NO
further OBJECTION, CSHB 284 (FIN) was REPORTED out of
committee with a "do pass" recommendation.
Co-Chair Stoltze MOVED to ADOPT proposed committee
substitute HB 285 (FIN) CS27-GH2593\I (Bailey 3/13/12) as a
working document. There being NO OBJECTION it was so
ordered.
Co-Chair Stoltze MOVED to report CSHB 285(FIN) out of
committee with individual recommendations.
Representative Gara OBJECTED. He noted a change to be
looked at before the bill hits the floor.
Representative Gara WITHDREW his objection. There being NO
further OBJECTION, CSHB 285 (FIN) was REPORTED out of
committee with a "do pass" recommendation.
Representative Doogan expressed his thoughts concerning the
budget. He signified that he would be voting against the
budget on the floor as he thought it was too much money. He
stressed that it was not a criticism of anyone who worked
on the budget, but believed the legislators had a
responsibility to not do what has always done whenever
money was available. He cautioned that the present level of
spending was not sustainable. He admitted voting for the
budget the last two years for political reasons, but now
regrets his action, and, if he had it to do over, would not
vote for the budget. He remarked that he did not know what
to do about the high costs and acknowledged that inflation,
salary increases, and higher costs all contribute inflate
the budget. The budget passes with good explanations and
reasons, but the result is the budget has risen 7.8 percent
per year and the operating budget has nearly doubled in the
last ten years. He admitted being unable to see how the
high increases can be resolved. Along with the increase in
the budget, he pointed out that there needs to be a
corresponding level of oil money to meet the growing needs.
He was concerned about the time when more money was being
spent than was being generated. He applauded the people
working on the problem, especially Vice-chair Fairclough.
He regretted leaving the legislature with the work not
complete. He predicted that the spending was unsustainable
and hard times were in the future if spending was not
reigned in. He thanked the committee for giving him the
opportunity to explain why he was voting against the bill.
9:02:34 AM
Representative Joule agreed with many issues brought up by
Representative Doogan, but indicated he would vote for the
budget. He found it amazing that due to the time
constraints of the session, the legislature must deal with
the operating budget by the increments requested by the
governor. He did not feel the best was being done for the
people in the state in a limited 90 day session. He stated
that more time was needed and cited the need to return to
the 120 day session. He pointed out it was possible to deal
with the budget in 90 days if more work was involved during
the interim. The Missions and Measures process was in place
to help review how well the agencies were using the money
being spent. Policy and funding of how the process was
conducted will benefit the budget process. He reiterated
the need to work harder during the interim on budget items.
He thanked the budget subcommittees and his staff for all
their work and assistance.
9:07:29 AM
Representative Neuman indicated he had been more involved
in the budget process over recent years and commended
Missions and Measures program. He believed the budget money
would help Alaska become more efficient in the future. He
pointed out that the cost of government continued to climb
while the pipeline was delivering less and less. There are
things to like and dislike in the budget, but the budget
process was a public process. He stressed the importance of
spending money efficiently now to try and help the future
when money may not be as readily available. He declared his
support for the bill.
9:10:19 AM
Co-Chair Stoltze acknowledged the individuals who dealt
with the hard parts of the budget: the Department of Health
and Social Services, the university, and education. He
pointed out that the amount of spending was going up and
items were more expensive. He remarked on the
responsibility and difficulty in making tough unpopular
decisions and acknowledged the internal pressures in the
capitol from the public. New bills were also being
presented that would increase formula growth. He furthered
that the price of oil will not always be high and
production was slowing down. He impressed that decisions
are daunting especially with large departments, such as the
ones Vice-chair Fairclough and Representative Joule had to
deal with. Spending will continue to add up.
9:14:50 AM
Representative Gara acknowledged that Representative Doogan
had been consistent on his views concerning the budget. The
political idea in Washington D.C. has been for one party to
tear apart anything that another party presents. Although
the impasse is seen all the time in politics, he indicated
his plan to vote for the budget as he believed it moved the
state forward. He remarked that there were parts of the
budget he liked and some parts he did not like. He told a
story of funding for a health care issue and expressed that
there were items in the budget that paid for things that no
one with a conscience would take out. It was hard to find
major changes without a slash and burn approach. One thing
the legislature is unable to do is ask agencies if they
were operating efficiently. Only the governor has the
ability to perform that task, but efficiency could be one
way to get control of the budget. He pointed out that there
were some items in the budget that would make situations
better and save the state money in the future such as
education. He added that an unpopular stand might be to ask
wealthy cities to pay for more of their municipal needs
instead of asking for state funding. He believed the budget
to be a status quo budget. He recognized the future
struggle to find exactly where and when to cut the budget.
9:20:58 AM
Vice-chair Fairclough gave credit to the Alaska Housing
Finance Corporation for discovering a way, in cooperation
with the governor's office, to help with housing for
individuals affected by domestic violence.
Representative Guttenberg mentioned that being involved
with the budget process was like wrestling with a giant
beast. He signified that each member has a role and
responsibility with external and internal pressures, but
Alaska was a young state where funding basic needs was
still part of the growth process. He likened the growing
health care to a giant beast; at some point health care
will need to be addressed and dealt with. He thanked the
co-chairs and subcommittee chairs for their work.
9:25:38 AM
Co-Chair Thomas thanked the committee and the chairs of the
subcommittees for their hard work. He asserted that there
are many decisions to make, but cuts were needed to prepare
for the future shortfall. He thanked David Teal and Amanda
Wright and their staff. He also thanked his staff for their
assistance. He announced that the operating budget in 1966
was $100,000,000 and stressed the inflation level of the
budget which is now at $9.6 billion. He thanked again the
administration and all who worked on the budget.
HOUSE BILL NO. 250
"An Act relating to the renewable energy grant fund
and recommendation program; and providing for an
effective date."
HB 250 was SCHEDULED but not HEARD.
9:29:40 AM
AT EASE
9:40:30 AM
RECONVENED
HOUSE BILL NO. 358
"An Act relating to an advertising campaign in support
of opening the Arctic National Wildlife Refuge for
development."
Co-Chair Stoltze opened the meeting and reported that HB
358 was unchanged.
Vice-chair Fairclough MOVED to ADOPT HB 358, 27-LS1406\M as
a working document. There being NO OBJECTION is so ordered.
9:41:36 AM
REPRESENTATIVE LANCE PRUITT, SPONSOR presented HB 358 as an
advertising campaign to open the Arctic National Wildlife
Refuge (ANWR) for development. The bill would direct the
state to contract with a qualified trade organization to
advertise opening the coastal plain of ANWR for oil and gas
exploration and development. The Alaska National Interest
Land Conservation Act of 1980 prohibited the leasing or
other development leading to the production of oil and gas
from the Arctic National Wildlife Refuge. He stressed that
domestic demand for oil continues to rise. The proposed
trade organization could communicate that new technology
had greatly improved the environmental impact on drilling
and that oil and gas development can coexist in Alaska's
arctic. He concluded that state revenue depends on resource
development; therefore it makes sense to promote
responsible development to benefit Alaskans.
DIRK CRAFT, STAFF, REPRESENTATIVE LANCE PRUITT, informed
the committee that the legislation has been modeled
directly after the state's tourism marketing contract
statute.
9:44:21 AM
Representative Wilson asked if there was a needed amount to
make the program effective. Representative Pruitt responded
that a qualified trade organization would determine the
amount. The amount would be whatever the organization would
be willing to bring to the table, and then the state would
match that amount. He expected it would be less than
$500,000 from a small organization. If a larger
organization was interested then the amount would be
larger, but the expected amount would probably be under one
million for the first year.
Representative Gara agreed it seemed reasonable to set the
record straight on ANWR. He expressed his concern that some
individuals may reap a short term advantage, but give
Alaska a long term disadvantage. He suggested that ads
taken out may target certain political candidates in the
lower 48. The short term benefit could be for candidates to
use the cause for personal gain to obtain more votes, but
the long term damage would be other individuals hating
Alaska for interfering in another state's politics. He
believed some politicians, who were for opening ANRW, would
support it, but, once elected, makes sure it was never
opened. He would like accurate information about ANWR to
set the record straight in the lower 48, but cautioned
against targeting candidates.
Representative Pruitt indicated he would be willing to talk
with Representative Gara. He avowed that the intent was not
to influence political candidates, but to provide an
opportunity to address constituents in the United States
about the information. He wanted to make sure people had
accurate information on ANWR.
9:48:38 AM
Co-Chair Stoltze appreciated Representative Gara's point.
He wondered if the state should be spending money on
initiatives and referendums and stressed that it could be
counterproductive to use state money in that manner. He
indicated the desire to move the bill out of committee, but
a few policy questions needed to be cleared up.
Representative Pruitt agreed.
Representative Costello indicated she was trying to
understand the logistics of the bill. She questioned if
there would be proposals from organizations, the state
would identify the winning proposal, and then match the
proposal's amount. She asked how that would work and how
the money would be raised. Representative Pruitt answered
that the trade association, determined by the Department of
Commerce, would provide the proposed money amount that they
received from many different sources. The money would be
from the private sector and the organization would be
responsible for acquiring the money; it would not be on the
state. The legislature then would appropriate the money to
match the amount. The ownership of the marketing campaign
would be shared jointly by the trade association and the
state. Representative Costello asked if an amount had been
determined for the campaign. Representative Pruitt
specified that that he did not want to put a limit on the
marketing group. The plan was to market Alaska's resources
and bring more money into the state. He believed Alaska
should celebrate if a group wanted to put a large amount of
money into the campaign. He did not want to limit what the
private sector could bring in. He emphasized that it was a
50/50 program. He reiterated that to date the number was
closer to $500,000. Representative Costello pointed out
that there are organizations presently working on the issue
and wondered if the bill included coordination to prevent
duplication of efforts. Representative Pruitt stated that
there was nothing in the bill that specifically states
there must be coordination to avoid duplication. He was not
aware of any other campaign on a national scale regarding
the issue.
9:54:18 AM
Co-Chair Stoltze appreciated that on page 1, line 13-14
where it states a direct ownership of the campaign.
Representative Neuman indicated his confusion on how the
funding mechanism worked. Representative Pruitt revealed
that the bill was modeled after the tourism campaign. The
Department of Commerce does not have a monetary fund, but
the trade association would approach the department with a
monetary amount and then money would be appropriated by the
legislature up to 50 percent. Representative Neuman
summarized that the state would enter into a contact with a
qualified trade association, the association would get
funding for lobbying for ANWR, and then ask the legislature
for matching funds. Representative Pruitt emphasized that
the plan was for a marketing campaign not lobbying. He
continued that the association would find the money; it
would not be on the state.
Representative Neuman voiced his concern over the state's
monetary obligation and would like to see a limit put on
for budgetary reasons. He would like further information on
the state's obligation.
Co-Chair Stoltze reiterated that the monetary number would
be subject to appropriation. Representative Neuman
questioned if the state does not match the amount by 50
percent, what then would happen.
9:59:46 AM
Representative Pruitt responded that choices would be made.
The campaign could still go forth even if the state does
not match the 50 percent.
Representative Doogan wanted an idea of how much money has
been put into the ANWR Arctic Power. Representative Pruitt
did not know the exact amount. Arctic Power money is used
for individuals to talk directly to people on Capitol Hill.
The purpose of the campaign was not to reach people in
Washington, but to communicate information to the people
who elect the representatives to Washington.
Representative Doogan wanted the Arctic Power information.
He expressed his frustration with all the indeterminate
fiscal notes. He asked for a projection, not just a blank
check. He did not believe it responsible to keep rubber
stamping indeterminate fiscal notes.
Co-Chair Stoltze interjected his concerns about the
political perimeters and the monetary limits of the bill.
He indicated that he would like to see a committee
substitute to answer the questions rather than deal with
the questions on the floor.
Representative Doogan revealed he was not trying to block
the bill, but would prefer more parameters. The fiscal
notes are not telling the committee anything.
10:06:27 AM
Vice-chair Fairclough revealed a letter of support from the
local Teamsters 959 indicating that there could many trade
organizations that might want to move the message forward
concerning ANWR. A limit or an amount was needed so there
would be a real number to evaluate. She wondered if the
campaign would qualify for a film tax credit. She voiced
her concern of an outside organization crafting the ANWR
message. She again mentioned the Arctic Power organization
was a very small office, but the state was receiving a lot
for the money invested. She stated though that it was hard
for one person to reach all the powers in Washington with
the message. Arctic Power has been trying to get factual
information out to the public, but some in the organization
may not know enough. There needs to be a consistency in the
message. She suggested that maybe Arctic Power was
targeting those who already support ANWR development,
instead of targeting those who are opposed. She indicated
her support for an advertising campaign, but suggested it
be a consolidated effort with the Arctic Power board. She
reported that 41 U.S. senators voted for development of
ANWR and it was a prime time to advertise for arctic
development.
10:13:09 AM
Representative Edgmon indicated he would be supporting the
bill, but was skeptical on what it will produce. He
believed it would take a broad scale message. Alaska is
viewed nationally as the last frontier so he is dubious on
what will be achieved. He also indicated some technical
questions.
Co-Chair Stoltze asserted that Alaska is not in a good
position just having the oil industry is the spokesmen. The
state needs to speak as a state policy issue. HE would
prefer Alaskans to speak with their own voice.
HB 358 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
The meeting was adjourned at 10:16 AM.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB250 Don Eller Letters.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 250 |
| HB 358 Supporting Documents - Support Letter Alliance 3-2-12.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 358 |
| HB 358 Supporting Documents - Arctic Power 49 ANWR bullet points.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 358 |
| HB 358 Supporting Documents - AK Chamber Letter of Support.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 358 |
| HB 358 Sponsor Statement.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 358 |
| HB 358 Sectional Analysis.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 358 |
| HB250-DCCED-AEA-03-09-12-Recent-Updated.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 250 |
| HB 250 Letters.PDF |
HFIN 3/14/2012 8:30:00 AM |
HB 250 |
| HB358 Teamsters Letter.pdf |
HFIN 3/14/2012 8:30:00 AM |
HB 358 |