Legislature(1993 - 1994)

04/07/1993 02:38 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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                     HOUSE FINANCE COMMITTEE                                   
                          April 7, 1993                                        
                            2:38 p.m.                                          
                                                                               
  TAPE HFC 93-97, Side 1, #000 - end.                                          
  TAPE HFC 93-97, Side 2, #000 - 258.                                          
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair Larson called the House  Finance Committee to order                 
  at 2:38 p.m.                                                                 
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Larson             Representative Hoffman                           
                                Representative Martin                          
  Vice-Chair Hanley           Representative Navarre                           
  Representative Brown        Representative Parnell                           
  Representative Foster       Representative Therriault                        
  Representative Grussendorf                                                   
                                                                               
  Co-Chair MacLean was absent from the meeting.                                
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Representative Bunde; Dave Kellyhouse, Director, Division of                 
  Wildlife Conservation, Department  of Fish and  Game; Ceilia                 
  Kunz, Juneau, Rupe Andrews, American  Association of Retired                 
  Persons;  Nancy  Bear-Usera,  Commissioner,   Department  of                 
  Administration.                                                              
                                                                               
  SUMMARY INFORMATION                                                          
                                                                               
  HCR 9     Relating   to   management   of    the   community                 
            development fisheries quota program  and fisheries                 
            development by the state.                                          
                                                                               
            CSHCR 9 (FSH) was reported out of Committee with a                 
            "do pass" recommendation   and with a  zero fiscal                 
            note by  the Department  of Fish  and Game,  dated                 
            3/17/93.                                                           
                                                                               
  HB 81     "An Act relating to the longevity bonus program."                  
                                                                               
            HB 81 was HELD in Committee.                                       
                                                                               
  HB 232    "An  Act relating  to a  bow hunting  tag and  bow                 
            hunting  safety; and  providing  for an  effective                 
            date."                                                             
                                                                               
            HB 232  was reported out  of Committee with  a "do                 
            pass" recommendation and with a fiscal impact note                 
                                                                               
                                1                                              
                                                                               
                                                                               
            by the Department of Fish and Game, dated 3/26/93.                 
                                                                               
  HB 253    "An Act amending the basis for determining refunds                 
            to local  governments under the  program of shared                 
            fisheries taxes;  and providing  for an  effective                 
            date."                                                             
                                                                               
            HB 253  was reported out  of Committee with  a "do                 
            pass" recommendation and with a fiscal impact note                 
            by the Department of Revenue.                                      
  HOUSE CONCURRENT RESOLUTION NO. 9                                            
                                                                               
       Relating  to management  of  the community  development                 
       fisheries  quota program  and fisheries  development by                 
       the state.                                                              
                                                                               
  Representative Hoffman noted  that HCR  9 was introduced  to                 
  insure  the  State's role  in  the Western  Alaska Community                 
  Development Quota Program (CDQ).   The North Pacific Fishery                 
  Management  Council  established   the  CDQ  Program  as   a                 
  component of the Inshore/Offshore  allocation.  He  asserted                 
  that the progam  is the most extensive  economic development                 
  effort ever to occur in the poorest regions of Alaska.                       
                                                                               
  Representative  Hoffman  maintained  that  the  CDQ  program                 
  provides  an  opportunity  for  long-term,  stable  economic                 
  development for  the communities  of the  Bering Sea  coast,                 
  Aleutian and Pribilof  Islands.  He noted  that the Governor                 
  is  responsible  for  requesting, accepting,  and  reviewing                 
  proposals for quota  allocation.  He  asserted that the  CDQ                 
  program needs  strong leadership and  coordinated support to                 
  be successful.                                                               
                                                                               
  Representative Hoffman spoke in support of a review  of past                 
  fisheries development  policy proposals.  He maintained that                 
  a comprehensive fisheries  development policy that  includes                 
  the  CDQ program  is  necessary for  the  protection of  the                 
  State's renewable multi-billion dollar fishing industry.                     
                                                                               
  Representative   Hoffman   observed   that  the   resolution                 
  recognizes the CDQ program.   He requested that the Governor                 
  fully  commit  the resources  of  his administration  to the                 
  program's  extension  and  expansion  in  the   interest  of                 
  benefiting  the  economies of  both  western Alaska  and the                 
  entire State of Alaska.                                                      
                                                                               
  Representative Hoffman MOVED to report CSHCR 9  (FSH) out of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal  note.  There being NO OBJECTION, it was                 
  so ordered.                                                                  
                                                                               
                                                                               
                                2                                              
                                                                               
                                                                               
  CSHCR 9 (FSH) was reported out of Committee with a "do pass"                 
  recommendation    and  with  a   zero  fiscal  note  by  the                 
  Department of Fish and Game, dated 3/17/93.                                  
  HOUSE BILL NO. 232                                                           
                                                                               
       "An Act relating to  a bow hunting tag and  bow hunting                 
       safety; and providing for an effective date."                           
                                                                               
  REPRESENTATIVE CON  BUNDE stressed  that HB  232 is  revenue                 
  generating.  He stated that a bow hunting tag will be issued                 
  to develop a hunting safety program.                                         
                                                                               
  DAVE    KELLYHOUSE,    DIRECTOR,   DIVISION    OF   WILDLIFE                 
  CONSERVATION, DEPARTMENT OF  FISH AND  GAME stated that  the                 
  Department's bow hunting  safety program may be  in jeopardy                 
  due  to cuts  in  the Department.   He  noted  that the  bow                 
  hunting community has  suggested the program as  a voluntary                 
  effort to support wildlife conservation.                                     
                                                                               
  Representative  Martin  asked how  much revenue  the program                 
  will generate.   Mr. Kellyhouse stated that  they anticipate                 
  that $35.0 thousand dollars will be generated.                               
                                                                               
  Mr. Kellyhouse  clarified, in  response to  a question  from                 
  Representative Therriault, that the tag  will be in addition                 
  to the hunting license.                                                      
                                                                               
  Representative  Martin  MOVED  to  report   HB  232  out  of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying fiscal note.  There being NO OBJECTION, it  was                 
  so ordered.                                                                  
                                                                               
  HB  232  was reported  out  of  Committee with  a  "do pass"                 
  recommendation  and  with  a  fiscal   impact  note  by  the                 
  Department of Fish and Game, dated 3/26/93.                                  
  HOUSE BILL NO. 253                                                           
                                                                               
       "An Act amending  the basis for determining  refunds to                 
       local governments under the program of shared fisheries                 
       taxes; and providing for an effective date."                            
                                                                               
  Co-Chair  Larson  explained  that HB  253  requires  that 95                 
  percent of the  shared fisheries taxes be shared  with local                 
  governments.  Currently, 100 percent  of the funds collected                 
  are shared.   Municipalities would  receive 47.5 percent  of                 
  the fisheries tax.                                                           
                                                                               
  Representative Grussendorf  spoke in  opposition of HB  253.                 
  Representative  Martin asserted that  the state's portion is                 
  only  40 percent.   Representative  Grussendorf pointed  out                 
                                                                               
                                3                                              
                                                                               
                                                                               
  that the state support for municipalities has been reduced.                  
                                                                               
  Representative  Navarre felt  that  administrative costs  be                 
  taken of  the top  before  revenues are  divided.   Co-Chair                 
  Larson asked  if 5 percent represents  actual administrative                 
  costs.                                                                       
                                                                               
  PAUL DICK, DEPARTMENT OF REVENUE noted that the  state would                 
  receive approximately $1  million dollars for administrative                 
  costs.    He estimated  that  this  would  be  a  reasonable                 
  reimbursement  for the  state's  administrative costs.   The                 
  state collects the tax from the fish processors.                             
                                                                               
  Representative Navarre observed  that 50 percent of  the net                 
  proceeds  will   still  be   shared.     He  stressed   that                 
  municipalities will only pay 2.5 percent.                                    
                                                                               
  Representative  Navarre  MOVED  to  report  HB  253  out  of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying  fiscal  note.     Representative   Grussendorf                 
  OBJECTED.                                                                    
                                                                               
  Representative  Hoffman  MOVED  to  delete  "5" percent  and                 
  insert "2.5" percent.  Representative  Navarre OBJECTED.  He                 
  stressed that the cost of state programs must be supported.                  
                                                                               
  A roll call vote was taken on the motion.                                    
                                                                               
  IN FAVOR: Hoffman, Grussendorf                                               
  OPPOSED:  Hanley,  Martin,   Parnell,  Therriault,   Larson,                 
                 Brown, Navarre                                                
                                                                               
  Representative Foster and Co-Chair  MacLean were absent from                 
  the vote.                                                                    
                                                                               
  The MOTION FAILED (2-7).                                                     
                                                                               
  Representative  Navarre  MOVED  to  report  HB  253  out  of                 
  Committee  with  individual  recommendations  and  with  the                 
  accompanying  fiscal  note.     Representative   Grussendorf                 
  OBJECTED.  A roll call vote was taken on the motion.                         
                                                                               
  IN FAVOR: Hanley,  Martin,   Parnell,  Therriault,   Larson,                 
                 Brown, Navarre                                                
  OPPOSED:  Hoffman, Grussendorf                                               
                                                                               
  The MOTION PASSED (7-2).                                                     
                                                                               
  Representative Foster and Co-Chair MacLean  were absent from                 
  the vote.                                                                    
                                                                               
  HB  253  was reported  out  of  Committee with  a  "do pass"                 
                                                                               
                                4                                              
                                                                               
                                                                               
  recommendation  and  with  a  fiscal   impact  note  by  the                 
  Department of Revenue.                                                       
  HOUSE BILL NO. 81                                                            
                                                                               
       "An Act relating to the longevity bonus program."                       
                                                                               
  CEICLIA KUNZ, JUNEAU  spoke in support of  continued funding                 
  of the longevity bonus program.   She asked "what will those                 
  old people do" without continuation of the program.                          
                                                                               
  RUPE ANDREWS, AMERICAN ASSOCIATION  OF RETIRED PERSONS spoke                 
  in opposition of CSHB 81 (STA).  He supported the Governor's                 
  legislation, SB 58.  He preferred a phase-out period.                        
                                                                               
  NANCY BEAR-USERA, COMMISSIONER, DEPARTMENT OF ADMINISTRATION                 
  noted that  the state has  attempted to  address the  fiscal                 
  liability of the longevity bonus program.  She stressed that                 
  Governor's   proposal  is   fair   and   reasonable.     The                 
  Administration is not in support of CSHB 81 (STA).                           
                                                                               
  Representative  Martin  felt   that  the  phase-out   period                 
  proposed in SB 58 is too protracted.  He asked if a straight                 
  step down program was considered.  Commissioner Usera stated                 
  that  a  straight step  down approach  was considered.   She                 
  stressed that the intent is to protect current participants.                 
  She noted that those on the program are generally on a fixed                 
  income.                                                                      
                                                                               
  Commissioner  Usera clarified that  under SB 58  the cost of                 
  the  program would rise for four years.  CSHB 81 (STA) would                 
  result  in  an  immediate  savings  of  approximately $1,200                 
  thousand dollars in FY 94.  She stressed that the Governor's                 
  approach considers the social need  along with the financial                 
  concerns of the state.                                                       
                                                                               
  Representative Therriault  expressed  the desire  to see  an                 
  immediate  savings.   Commissioner Usera  asserted that  the                 
  state can afford to continue the program in order to allow a                 
  phase out of the program.                                                    
                                                                               
  Representative Martin  expressed concern with  hold harmless                 
  costs.                                                                       
                                                                               
  (Tape Change, HFC 93-97, Side 2)                                             
                                                                               
  Representative   Martin   favored   an  immediate   savings.                 
  Commissioner Usera strongly  supported a phase-out approach.                 
  She  noted  that the  Department of  Administration's budget                 
  fully funds the FY 94 longevity  bonus.  She reiterated that                 
  the Governor's plan is reasonable.                                           
                                                                               
                                                                               
                                5                                              
                                                                               
                                                                               
  Co-Chair  Larson  emphasized  the  state's  need  to  reduce                 
  spending.      He   noted   that   state  expenditures   are                 
  approximately $250 million dollars over  state revenues.  He                 
  asked, how long can the  State of Alaska spend more  than it                 
  makes.                                                                       
                                                                               
  Representative  Brown  asked   if  the  Administration   has                 
  considered  reducing payments  to $225  hundred  dollars per                 
  month  and retaining the  phase-out approach.   Commissioner                 
  Usera  replied that she has  been convinced that $25 dollars                 
  less  a  month   would  represent  a  large   reductions  to                 
  participants of the program.                                                 
                                                                               
  Representative Therriault asked if the  decision was made to                 
  hold  harmless  those  that are  currently  on  the program.                 
  Commissioner  Usera  replied  that  the  intent is  to  hold                 
  harmless current participants as long as possible.                           
                                                                               
  HB 81 was HELD in Committee.                                                 
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 3:31 p.m.                                           
                                                                               
                                                                               
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