Legislature(1993 - 1994)

02/16/1994 01:40 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
                                                                               
                     HOUSE FINANCE COMMITTEE                                   
                        February 16, 1994                                      
                            1:40 P.M.                                          
                                                                               
  TAPE HFC 94 - 34, Side 2, #000 - end.                                        
  TAPE HFC 94 - 35, Side 1, #000 - end.                                        
  TAPE HFC 94 - 35, Side 2, #000 - #336.                                       
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair Larson  called the House Finance  Committee meeting                 
  to order at 1:40 P.M.                                                        
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Larson               Representative Hoffman                         
  Co-Chair MacLean              Representative Martin                          
  Vice-Chair Hanley             Representative Navarre                         
  Representative Brown          Representative Foster                          
  Representative Grussendorf    Representative Therriault                      
                                                                               
  Representative Parnell was not present for the meeting.                      
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Nancy Slagle, Director, Division of Budget Review, Office of                 
  Management and  Budget, Office  of the  Governor; Arthur  H.                 
  Snowden, II,  Administrative Director, Alaska  Court System;                 
  Peter Bushre, Chief Financial Officer, Alaska Permanent Fund                 
  Corporation, Juneau; Sharon Barton, Director, Administrative                 
  Services,  Department  of  Administration;   Francis  Cater,                 
  (teleconference),  Kodiak  Alliance   for  Mental   Illness,                 
  Kodiak;  Martin  White,  (teleconference), Director,  Mental                 
  Health Center, Kodiak; Doug Pomeroy, (teleconference), Self,                 
  Fairbanks; Joy Albin,  (teleconference), Fairbanks  Alliance                 
  for  the  Mentally  Ill,  Fairbanks;  W. Harrison  Childers,                 
  (teleconference),  Substance  Abuse  Counselor, Correctional                 
  Institute   and  Security   Prison,   Seward;  John   Lohse,                 
  (teleconference),   Director,   Alaska   Vocational  Center,                 
  Seward; Terrie Nash, (teleconference), Resident, Seward; Kim                 
  Soriano,  (teleconference),  Financial Officer,  Seward Life                 
  Action     Council,     Seward;     Gabriella     Armstrong,                 
  (teleconference),  Clinical  Director,  Seward  Life  Action                 
  Council,  Seward;  Mark Gorman,  (teleconference), Southeast                 
  Alaska  Regional  Health  Corporation,   Sitka;  Jim  Clark,                 
  (teleconference),  Director,   Central  Peninsula   Catholic                 
  Services,  Kenai;  Coral   Allen,  (teleconference),   Kenai                 
  Alliance  for  the  Mentally  Ill,  Kenai;  Wayne  McCollum,                 
  (teleconference),  Mental Health,  Tok;  Mary Jane  Michael,                 
  (teleconference),      Anchorage;      Rick      Tessandorf,                 
  (teleconference),  Executive  Director,  Advocacy  Services,                 
                                                                               
                                1                                              
                                                                               
                                                                               
  Anchorage; Wes Skinner, (teleconference), Alaska Specialized                 
  Education  Training Services,  Alaska  Mental Health  Board,                 
  Anchorage; Ken Taylor, (teleconference), Anchorage Community                 
  Mental   Health   Center,   Anchorage;    Yvonne   Jacobson,                 
  (teleconference),  Alaska  All  Mental   Health,  Anchorage;                 
  Brenda  Knapp, Executive  Director, Juneau Alliance  for the                 
  Mentally Ill (JAMI), Juneau.                                                 
                                                                               
  SUMMARY                                                                      
  HB 441    An Act reducing  certain appropriations for fiscal                 
            year 1994; and providing for an effective date.                    
                                                                               
            HB  441   was  HELD   in  Committee  for   further                 
            consideration.                                                     
                                                                               
  HB 455    An Act  making and amending  operating and capital                 
            appropriations   and   ratifying   certain   state                 
            expenditures; and providing for an effective date.                 
                                                                               
            HB  455   was  HELD   in  Committee  for   further                 
            consideration.                                                     
                                                                               
  HOUSE BILL 441                                                               
                                                                               
       "An Act reducing certain appropriations for fiscal year                 
       1994; and providing for an effective date."                             
                                                                               
  HOUSE BILL 455                                                               
                                                                               
       "An  Act  making  and  amending  operating  and capital                 
       appropriations    and    ratifying     certain    state                 
       expenditures; and providing for an effective date."                     
                                                                               
  JOY   ALBIN,   (TESTIFIED  VIA   TELECONFERENCE),  FAIRBANKS                 
  ALLIANCE   FOR  THE  MENTALLY   ILL,  FAIRBANKS,   spoke  in                 
  opposition  to  HB  441 and  recommended  that  the Medicaid                 
  reimbursement  funds should  be  capped before  programs are                 
  cut.                                                                         
                                                                               
  DOUG   POMEROY,   (TESTIFIED   VIA  TELECONFERENCE),   SELF,                 
  FAIRBANKS, spoke in opposition to HB 441 and encouraged that                 
  reductions not be  carried into  the operational grants  for                 
  mental health centers.                                                       
                                                                               
  MARK  GORMAN,  (TESTIFIED  VIA   TELECONFERENCE),  SOUTHEAST                 
  ALASKA  REGIONAL HEALTH  CORPORATION,  SITKA, noted  concern                 
  with  the  continual erosion  from  the operational  base of                 
  mental health programs.   Mr. Gorman spoke in opposition  to                 
  HB 441.                                                                      
                                                                               
                                                                               
                                2                                              
                                                                               
                                                                               
  JIM CLARK, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, CENTRAL                 
  PENINSULA CATHOLIC  SERVICES, KENAI,  recommended that  cuts                 
  this year  should come from disproportionate  share dollars.                 
  He spoke in support of the Medicaid supplemental offered  in                 
  HB 455, noting that Medicaid provides twenty-five percent of                 
  their current budget.                                                        
                                                                               
  CORAL ALLEN, (TESTIFIED VIA TELECONFERENCE), KENAI  ALLIANCE                 
  FOR MENTALLY ILL, KENAI, spoke against "discretionary" funds                 
  being allocated  for mental  health concerns  in the  State.                 
  She  urged  the  Committee to  increase  funding  for mental                 
  health issues.                                                               
                                                                               
  MARTIN  WHITE,  (TESTIFIED  VIA  TELECONFERENCE),  DIRECTOR,                 
  MENTAL HEALTH CENTER, KODIAK, spoke against HB 441.                          
                                                                               
  FRANCIS  CATER,  (TESTIFIED   VIA  TELECONFERENCE),   KODIAK                 
  ALLIANCE FOR  MENTALLY ILLNESS, KODIAK,  spoke in opposition                 
  to HB 441 urging  that mental health be exempt  from further                 
  cutting.                                                                     
                                                                               
  GABRIELLA   ARMSTRONG,   (TESTIFIED   VIA   TELECONFERENCE),                 
  CLINICAL DIRECTOR, SEWARD LIFE ACTION COUNCIL, SEWARD, spoke                 
  in opposition to  HB 441 noting that  continual cutting will                 
  eliminate valuable mental health programs.                                   
                                                                               
  TERRIE  NASH,  (TESTIFIED  VIA   TELECONFERENCE),  RESIDENT,                 
  SEWARD, spoke in opposition to HB 441.                                       
                                                                               
  W.  HARRISON  CHILDERS,   (TESTIFIED  VIA   TELECONFERENCE),                 
  SUBSTANCE  ABUSE  COUNSELOR,   CORRECTIONAL  INSTITUTE   AND                 
  SECURITY PRISON, SEWARD, stated that the proposed  decreases                 
  to the budget will effect the quality of life, particularly,                 
  in Seward with less services being offered to inmates.  This                 
  consequently  will  jeopardize the  quality  of life  in the                 
  entire State.  He spoke in opposition to HB 441.                             
                                                                               
  JOHN LOHSE, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, ALASKA                 
  VOCATIONAL CENTER, SEWARD,  spoke in  opposition to HB  441,                 
  adding that the impact of the legislation will detrimentally                 
  affect   the  quantity  and  quality  of  services  provided                 
  throughout the State.                                                        
                                                                               
  KIM  SORIANO,  (TESTIFIED  VIA   TELECONFERENCE),  FINANCIAL                 
  OFFICER, SEWARD  LIFE ACTION COUNCIL, SEWARD,  spoke against                 
  HB 441 and echoed  concern with the statewide impact  of the                 
  proposed cuts.                                                               
                                                                               
  RICK TESSANDORF, (TESTIFIED  VIA TELECONFERENCE),  EXECUTIVE                 
  DIRECTOR, ADVOCACY SERVICES, ANCHORAGE, spoke in  opposition                 
  to HB 441 stating that non profit providers  do not have the                 
  assets to off-set the proposed retroactive reductions.                       
                                                                               
                                3                                              
                                                                               
                                                                               
  WES   SKINNER,   (TESTIFIED   VIA  TELECONFERENCE),   ALASKA                 
  SPECIALIZED  EDUCATION  TRAINING  SERVICES,   ALASKA  MENTAL                 
  HEALTH BOARD,  ANCHORAGE, spoke in opposition to  HB 441 and                 
  the effect the legislation would have on Alaskans.  He urged                 
  the Committee to find cuts elsewhere in the budget, advising                 
  that Alaskans would  rather see service-delivery for  people                 
  who can not  provide for  themselves, than to  be "fat  cats                 
  with  jobs  in  the high  paid  resource  industries without                 
  services available".                                                         
                                                                               
  KEN  TAYLOR,  (TESTIFIED   VIA  TELECONFERENCE),   ANCHORAGE                 
  COMMUNITY  MENTAL HEALTH CENTER, ANCHORAGE, spoke against HB
  441 specifically addressing the retroactive cuts for service                 
  grants from the FY94 budget.                                                 
                                                                               
  (Tape Change, HFC 94-35, Side 1).                                            
                                                                               
  YVONNE JACOBSON, (TESTIFIED VIA  TELECONFERENCE), ALASKA ALL                 
  MENTAL HEALTH, ANCHORAGE, spoke in opposition to HB 441.                     
                                                                               
  WAYNE  MCCOLLUM,  (TESTIFIED  VIA   TELECONFERENCE),  MENTAL                 
  HEALTH, TOK, spoke in opposition to HB 441.                                  
                                                                               
  DIANA  BRANDT,  (TESTIFIED  VIA TELECONFERENCE),  ANCHORAGE,                 
  spoke in opposition to HB 441.                                               
                                                                               
  MARY   JANE   MICHAEL,   (TESTIFIED   VIA   TELECONFERENCE),                 
  ANCHORAGE,  spoke in opposition  to HB 441 and  HB 455.  She                 
  noted that the FY94 provider grants  had been reduced by ten                 
  percent.   Those  funds were transferred  to Medicaid.   She                 
  noted  that  agencies  had  been  promised  by  the  federal                 
  government, that if  the funds  were not "recaptured",  they                 
  would be returned in the fourth  quarter.  Concurrently, now                 
  health  care  providers  are  faced  with a  fourth  quarter                 
  reduction of forty percent.                                                  
                                                                               
  Representative Hanley  explained that  $1.6 million  dollars                 
  was placed into Project Choice last year in order to receive                 
  federal  matching  money.    Project   Choice  did  not  get                 
  implemented as quickly as anticipated, consequently,  people                 
  remained in  community based  services while  the money  had                 
  been transferred to  the waiver  program.  The  Subcommittee                 
  intends that $400 thousand dollars will be given  to Project                 
  Choice.  The  remaining $1.2 million dollars will  be placed                 
  into services.  He  added that this creates no  net increase                 
  or decrease, only a change in allocations.                                   
                                                                               
  Ms. Michael  responded that many small agencies  will not be                 
  able to wait  until the beginning of the new  fiscal year as                 
  the funds were originally promised  for the beginning of the                 
  fourth quarter (4/01/94).                                                    
                                                                               
                                4                                              
                                                                               
                                                                               
  Representative   Hanley   agreed   that   the   non   profit                 
  organizations provide a great service for a cheap price.  He                 
  added  that  community  based  services  are  cheaper   than                 
  institutions.  Representative Hanley  pointed out that there                 
  are  reserves  to  cover  the  gaps.   Six  percent  of  the                 
  unrestricted  general  funds are  placed into  mental health                 
  programs.   Last  year,  $132 million  dollars was  spent on                 
  those programs.                                                              
                                                                               
  Representative  Hanley continued  that  the six  percent  is                 
  equal to $100 million dollars which  would result in an over                 
  expenditure of $32 million dollars.  There currently is $140                 
  million dollars  remaining in the  Mental Health Trust.   He                 
  suggested that the mental health community prioritize within                 
  programs  and  recommended  that  those  referenced  by  the                 
  teleconference   participants   be   the  ones   maintained.                 
  Representative Hanley  reminded all participants  that there                 
  will be reductions with the current budget revenues.                         
                                                                               
  Representative Brown asked that information regarding budget                 
  "gaps" for FY94 and FY95 be  made available to the Minority.                 
                                                                               
                                                                               
  BRENDA KNAPP,  EXECUTIVE DIRECTOR, JUNEAU  ALLIANCE FOR  THE                 
  MENTALLY ILL (JAMI), JUNEAU, spoke in opposition to  HB 441.                 
  She  added,  without  the  services  and  funding  currently                 
  available, many of her clients would need to be hospitalized                 
  which  would be much  more costly to  the State.   She urged                 
  intent  language be offered  to assure that  the budget cuts                 
  are equally distributed amongst all programs.                                
                                                                               
  ARTHUR H. SNOWDEN, II, ADMINISTRATIVE DIRECTOR, ALASKA COURT                 
  SYSTEM, provided  the Committee  with  a handout  addressing                 
  disposition cases throughout  the State since July  1, 1993.                 
  [Attachment  #1].   He explained  that  caseloads throughout                 
  Alaskan communities have  risen as  much as thirty  percent.                 
  He pointed out that the Alaska  Court System budget has only                 
  grown .3%  since  1985.   Mr.  Snowden emphasized,  that  an                 
  additional  $470  thousand  dollar  funding  decrease  would                 
  severely handicap the Court System.                                          
                                                                               
  PETER BUSHRE, CHIEF FINANCIAL OFFICER, ALASKA PERMANENT FUND                 
  CORPORATION, DEPARTMENT  OF  REVENUE, spoke  to  the  Alaska                 
  Permanent Fund's  request for a  supplemental appropriation.                 
  He explained that  the Permanent Fund is currently worth $16                 
  million  dollars.    The manager's  fees  and  international                 
  custody fees have risen based on the value of the fund.  Mr.                 
  Bushre pointed out  that the amount  requested in HB 455  of                 
  $2,379.0  million  dollars would be short  $815,000 thousand                 
  dollars.  He  pointed out  that the language  in Section  12                 
  refers  only  to "equity  management  fees" and  should also                 
                                                                               
                                5                                              
                                                                               
                                                                               
  include  "custody  fees".    All   expenses  are  paid  from                 
  corporate receipts originating from the fund.                                
                                                                               
  NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF                 
  MANAGEMENT AND  BUDGET, OFFICE  OF THE  GOVERNOR, referenced                 
  the supplemental bill and the sectional analysis which would                 
  incorporate  the  changes   recommended  in  the   amendment                 
  submitted by the Governor.                                                   
                                                                               
  (Tape Change, HFC 94-35, Side 2).                                            
                                                                               
  Co-Chair  MacLean   provided  the  Committee   with  capital                 
  appropriation   budget   information.     Identification  of                 
  unobligated  general   funds  existing  from   past  capital                 
  appropriations  including  all  federal   authorization  has                 
  begun.  She said  repeals will not have an effect on capital                 
  dollars which have already been encumbered.  There will be a                 
  "window of opportunity" allowing state agencies to  encumber                 
  and expend balances until June 30, 1994.  She added  that to                 
  date,   $80   million  dollars   has   been  identified   as                 
  unobligated,  unexpended  general funds  still on  the books                 
  appropriated prior to July, 1990.  This information will  be                 
  provided to all House Finance Committee members.                             
                                                                               
  Ms.  Slagle  provided a  sectional overview  of HB  455, the                 
  Supplemental legislation.                                                    
                                                                               
  GOVERNOR'S OFFICE                                                            
                                                                               
       *    Sec. 1    Office  of  Management   and  Budget   -                 
                      $1,621.4 million dollars                                 
                                                                               
            This  request  would  provide  salary  adjustments                 
            required to comply  with the Fair  Labor Standards                 
            Act.                                                               
                                                                               
  DEPARTMENT OF ADMINISTRATION                                                 
                                                                               
       *    Sec. 2    Longevity   Bonus   Grants   -  $2,191.3                 
                      million dollars                                          
                                                                               
            This  request  would provide  funds  to  assist an                 
            increased number of recipients.                                    
                                                                               
  SHARON BARTON, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT                 
  OF ADMINISTRATION, explained the initial budget was based on                 
  an estimate.   Program changes  this past year  have created                 
  unpredictability  in program behavior.  The request reflects                 
  participants  over  and  above  those anticipated  when  the                 
  budget was written.                                                          
                                                                               
  HB  441  and  HB 455  were  HELD  in  Committee for  further                 
                                                                               
                                6                                              
                                                                               
                                                                               
  discussion.  #                                                               
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 3:30 P.M.                                           
                                                                               
                                                                               
                     HOUSE FINANCE COMMITTEE                                   
                        February 16, 1994                                      
                            1:40 P.M.                                          
                                                                               
  TAPE HFC 94 - 34, Side 2, #000 - end.                                        
  TAPE HFC 94 - 35, Side 1, #000 - end.                                        
  TAPE HFC 94 - 35, Side 2, #000 - #336.                                       
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Co-Chair Larson  called the House Finance  Committee meeting                 
  to order at 1:40 P.M.                                                        
                                                                               
  PRESENT                                                                      
                                                                               
  Co-Chair Larson               Representative Hoffman                         
  Co-Chair MacLean              Representative Martin                          
  Vice-Chair Hanley             Representative Navarre                         
  Representative Brown          Representative Foster                          
  Representative Grussendorf    Representative Therriault                      
                                                                               
  Representative Parnell was not present for the meeting.                      
                                                                               
  ALSO PRESENT                                                                 
                                                                               
  Nancy Slagle, Director, Division of Budget Review, Office of                 
  Management and  Budget, Office  of the  Governor; Arthur  H.                 
  Snowden, II, Administrative  Director, Alaska Court  System;                 
  Peter Bushre, Chief Financial Officer, Alaska Permanent Fund                 
  Corporation, Juneau; Sharon Barton, Director, Administrative                 
  Services,  Department  of  Administration;   Francis  Cater,                 
  (teleconference),  Kodiak  Alliance   for  Mental   Illness,                 
  Kodiak;  Martin  White,  (teleconference), Director,  Mental                 
  Health Center, Kodiak; Doug Pomeroy, (teleconference), Self,                 
  Fairbanks; Joy Albin,  (teleconference), Fairbanks  Alliance                 
  for  the  Mentally  Ill,  Fairbanks; W.  Harrison  Childers,                 
  (teleconference),  Substance  Abuse  Counselor, Correctional                 
  Institute   and  Security   Prison,   Seward;  John   Lohse,                 
  (teleconference),   Director,   Alaska   Vocational  Center,                 
  Seward; Terrie Nash, (teleconference), Resident, Seward; Kim                 
  Soriano,  (teleconference),  Financial Officer,  Seward Life                 
  Action     Council,     Seward;     Gabriella     Armstrong,                 
  (teleconference),  Clinical  Director,  Seward  Life  Action                 
  Council,  Seward;  Mark Gorman,  (teleconference), Southeast                 
  Alaska  Regional  Health   Corporation,  Sitka;  Jim  Clark,                 
  (teleconference),  Director,   Central  Peninsula   Catholic                 
                                                                               
                                7                                              
                                                                               
                                                                               
  Services,  Kenai;  Coral   Allen,  (teleconference),   Kenai                 
  Alliance  for  the  Mentally  Ill,  Kenai;  Wayne  McCollum,                 
  (teleconference),  Mental Health,  Tok;  Mary Jane  Michael,                 
  (teleconference),      Anchorage;      Rick      Tessandorf,                 
  (teleconference),  Executive  Director,  Advocacy  Services,                 
  Anchorage; Wes Skinner, (teleconference), Alaska Specialized                 
  Education  Training  Services, Alaska  Mental  Health Board,                 
  Anchorage; Ken Taylor, (teleconference), Anchorage Community                 
  Mental   Health   Center,   Anchorage;    Yvonne   Jacobson,                 
  (teleconference),  Alaska  All  Mental   Health,  Anchorage;                 
  Brenda Knapp,  Executive Director, Juneau  Alliance for  the                 
  Mentally Ill (JAMI), Juneau.                                                 
                                                                               
  SUMMARY                                                                      
                                                                               
  HB 441    An Act reducing certain  appropriations for fiscal                 
            year 1994; and providing for an effective date.                    
                                                                               
            HB  441   was  HELD   in  Committee   for  further                 
            consideration.                                                     
                                                                               
  HB 455    An Act making and  amending operating and  capital                 
            appropriations   and   ratifying   certain   state                 
            expenditures; and providing for an effective date.                 
                                                                               
            HB  455   was  HELD   in  Committee   for  further                 
            consideration.                                                     
                                                                               
  HOUSE BILL 441                                                               
                                                                               
       "An Act reducing certain appropriations for fiscal year                 
       1994; and providing for an effective date."                             
                                                                               
  HOUSE BILL 455                                                               
                                                                               
       "An  Act making  and  amending  operating  and  capital                 
       appropriations    and    ratifying     certain    state                 
       expenditures; and providing for an effective date."                     
                                                                               
  JOY   ALBIN,   (TESTIFIED  VIA   TELECONFERENCE),  FAIRBANKS                 
  ALLIANCE   FOR  THE   MENTALLY  ILL,  FAIRBANKS,   spoke  in                 
  opposition  to  HB  441 and  recommended  that  the Medicaid                 
  reimbursement  funds should  be capped  before  programs are                 
  cut.                                                                         
                                                                               
  DOUG   POMEROY,   (TESTIFIED   VIA  TELECONFERENCE),   SELF,                 
  FAIRBANKS, spoke in opposition to HB 441 and encouraged that                 
  reductions not be  carried into  the operational grants  for                 
  mental health centers.                                                       
                                                                               
  MARK  GORMAN,  (TESTIFIED  VIA   TELECONFERENCE),  SOUTHEAST                 
  ALASKA  REGIONAL  HEALTH CORPORATION,  SITKA,  noted concern                 
                                                                               
                                8                                              
                                                                               
                                                                               
  with  the  continual erosion  from  the operational  base of                 
  mental health programs.   Mr. Gorman spoke  in opposition to                 
  HB 441.                                                                      
                                                                               
  JIM CLARK, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, CENTRAL                 
  PENINSULA  CATHOLIC SERVICES,  KENAI, recommended  that cuts                 
  this year should  come from disproportionate share  dollars.                 
  He spoke in support of the Medicaid supplemental  offered in                 
  HB 455, noting that Medicaid provides twenty-five percent of                 
  their current budget.                                                        
                                                                               
  CORAL ALLEN, (TESTIFIED  VIA TELECONFERENCE), KENAI ALLIANCE                 
  FOR MENTALLY ILL, KENAI, spoke against "discretionary" funds                 
  being allocated  for mental  health concerns  in the  State.                 
  She  urged  the  Committee to  increase  funding  for mental                 
  health issues.                                                               
                                                                               
  MARTIN  WHITE,  (TESTIFIED  VIA  TELECONFERENCE),  DIRECTOR,                 
  MENTAL HEALTH CENTER, KODIAK, spoke against HB 441.                          
                                                                               
  FRANCIS  CATER,  (TESTIFIED   VIA  TELECONFERENCE),   KODIAK                 
  ALLIANCE FOR MENTALLY ILLNESS,  KODIAK, spoke in  opposition                 
  to HB 441 urging  that mental health be exempt  from further                 
  cutting.                                                                     
                                                                               
  GABRIELLA   ARMSTRONG,   (TESTIFIED   VIA   TELECONFERENCE),                 
  CLINICAL DIRECTOR, SEWARD LIFE ACTION COUNCIL, SEWARD, spoke                 
  in  opposition to HB 441  noting that continual cutting will                 
  eliminate valuable mental health programs.                                   
                                                                               
  TERRIE  NASH,  (TESTIFIED  VIA   TELECONFERENCE),  RESIDENT,                 
  SEWARD, spoke in opposition to HB 441.                                       
                                                                               
  W.  HARRISON  CHILDERS,   (TESTIFIED  VIA   TELECONFERENCE),                 
  SUBSTANCE  ABUSE  COUNSELOR,   CORRECTIONAL  INSTITUTE   AND                 
  SECURITY PRISON,  SEWARD, stated that the proposed decreases                 
  to the budget will effect the quality of life, particularly,                 
  in Seward with less services being offered to inmates.  This                 
  consequently  will  jeopardize the  quality  of life  in the                 
  entire State.  He spoke in opposition to HB 441.                             
                                                                               
  JOHN LOHSE, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, ALASKA                 
  VOCATIONAL CENTER, SEWARD,  spoke in  opposition to HB  441,                 
  adding that the impact of the legislation will detrimentally                 
  affect  the  quantity  and   quality  of  services  provided                 
  throughout the State.                                                        
                                                                               
  KIM  SORIANO,  (TESTIFIED  VIA   TELECONFERENCE),  FINANCIAL                 
  OFFICER, SEWARD LIFE  ACTION COUNCIL, SEWARD, spoke  against                 
  HB 441 and echoed  concern with the statewide impact  of the                 
  proposed cuts.                                                               
                                                                               
                                                                               
                                9                                              
                                                                               
                                                                               
  RICK TESSANDORF, (TESTIFIED  VIA TELECONFERENCE),  EXECUTIVE                 
  DIRECTOR, ADVOCACY SERVICES, ANCHORAGE, spoke in  opposition                 
  to HB 441 stating that non profit providers do not have  the                 
  assets to off-set the proposed retroactive reductions.                       
                                                                               
  WES   SKINNER,   (TESTIFIED   VIA  TELECONFERENCE),   ALASKA                 
  SPECIALIZED  EDUCATION  TRAINING  SERVICES,   ALASKA  MENTAL                 
  HEALTH  BOARD, ANCHORAGE, spoke in opposition  to HB 441 and                 
  the effect the legislation would have on Alaskans.  He urged                 
  the Committee to find cuts elsewhere in the budget, advising                 
  that Alaskans  would rather see  service-delivery for people                 
  who can not  provide for  themselves, than to  be "fat  cats                 
  with  jobs  in  the high  paid  resource  industries without                 
  services available".                                                         
                                                                               
  KEN  TAYLOR,  (TESTIFIED   VIA  TELECONFERENCE),   ANCHORAGE                 
  COMMUNITY MENTAL HEALTH CENTER,  ANCHORAGE, spoke against HB
  441 specifically addressing the retroactive cuts for service                 
  grants from the FY94 budget.                                                 
                                                                               
  (Tape Change, HFC 94-35, Side 1).                                            
                                                                               
  YVONNE JACOBSON, (TESTIFIED VIA TELECONFERENCE), ALASKA  ALL                 
  MENTAL HEALTH, ANCHORAGE, spoke in opposition to HB 441.                     
                                                                               
  WAYNE  MCCOLLUM,  (TESTIFIED  VIA   TELECONFERENCE),  MENTAL                 
  HEALTH, TOK, spoke in opposition to HB 441.                                  
                                                                               
  DIANA  BRANDT,  (TESTIFIED  VIA TELECONFERENCE),  ANCHORAGE,                 
  spoke in opposition to HB 441.                                               
                                                                               
  MARY   JANE   MICHAEL,   (TESTIFIED   VIA   TELECONFERENCE),                 
  ANCHORAGE, spoke  in opposition to HB  441 and HB 455.   She                 
  noted that the FY94 provider grants  had been reduced by ten                 
  percent.   Those funds were  transferred to  Medicaid.   She                 
  noted  that  agencies  had  been  promised  by  the  federal                 
  government, that if  the funds  were not "recaptured",  they                 
  would be returned in the  fourth quarter.  Concurrently, now                 
  health  care  providers  are  faced  with a  fourth  quarter                 
  reduction of forty percent.                                                  
                                                                               
  Representative  Hanley explained  that $1.6  million dollars                 
  was placed into Project Choice last year in order to receive                 
  federal  matching  money.    Project   Choice  did  not  get                 
  implemented as quickly  as anticipated, consequently, people                 
  remained in  community based  services while  the money  had                 
  been transferred to  the waiver  program.  The  Subcommittee                 
  intends that $400 thousand dollars will be  given to Project                 
  Choice.   The remaining $1.2 million dollars  will be placed                 
  into services.  He  added that this creates no  net increase                 
  or decrease, only a change in allocations.                                   
                                                                               
                                                                               
                               10                                              
                                                                               
                                                                               
  Ms.  Michael responded that many  small agencies will not be                 
  able  to wait until the beginning  of the new fiscal year as                 
  the funds were originally promised for the  beginning of the                 
  fourth quarter (4/01/94).                                                    
                                                                               
  Representative   Hanley   agreed   that   the   non   profit                 
  organizations provide a great service for a cheap price.  He                 
  added  that   community  based  services  are  cheaper  than                 
  institutions.  Representative Hanley pointed out  that there                 
  are  reserves  to  cover  the  gaps.   Six  percent  of  the                 
  unrestricted  general funds  are  placed into  mental health                 
  programs.   Last  year, $132  million dollars  was spent  on                 
  those programs.                                                              
                                                                               
  Representative  Hanley  continued  that the  six  percent is                 
  equal to $100 million dollars which  would result in an over                 
  expenditure of $32 million dollars.  There currently is $140                 
  million  dollars remaining in  the Mental Health  Trust.  He                 
  suggested that the mental health community prioritize within                 
  programs  and  recommended  that  those  referenced  by  the                 
  teleconference   participants   be   the  ones   maintained.                 
  Representative Hanley reminded  all participants that  there                 
  will be reductions with the current budget revenues.                         
                                                                               
  Representative Brown asked that information regarding budget                 
  "gaps" for FY94 and FY95 be  made available to the Minority.                 
                                                                               
                                                                               
  BRENDA KNAPP,  EXECUTIVE DIRECTOR,  JUNEAU ALLIANCE FOR  THE                 
  MENTALLY ILL (JAMI), JUNEAU, spoke in opposition  to HB 441.                 
  She  added,  without  the  services  and  funding  currently                 
  available, many of her clients would need to be hospitalized                 
  which would  be much more  costly to  the State.   She urged                 
  intent language be  offered to assure  that the budget  cuts                 
  are equally distributed amongst all programs.                                
                                                                               
  ARTHUR H. SNOWDEN, II, ADMINISTRATIVE DIRECTOR, ALASKA COURT                 
  SYSTEM,  provided the  Committee with  a handout  addressing                 
  disposition cases throughout  the State since July  1, 1993.                 
  [Attachment  #1].   He explained  that caseloads  throughout                 
  Alaskan communities have  risen as  much as thirty  percent.                 
  He pointed out that the Alaska  Court System budget has only                 
  grown  .3%  since 1985.    Mr. Snowden  emphasized,  that an                 
  additional  $470  thousand  dollar  funding  decrease  would                 
  severely handicap the Court System.                                          
                                                                               
  PETER BUSHRE, CHIEF FINANCIAL OFFICER, ALASKA PERMANENT FUND                 
  CORPORATION,  DEPARTMENT  OF REVENUE,  spoke  to the  Alaska                 
  Permanent Fund's request  for a supplemental  appropriation.                 
  He explained  that the Permanent Fund is currently worth $16                 
  million  dollars.    The  manager's  fees and  international                 
  custody fees have risen based on the value of the fund.  Mr.                 
                                                                               
                               11                                              
                                                                               
                                                                               
  Bushre pointed out  that the amount  requested in HB 455  of                 
  $2,379.0  million  dollars would be short  $815,000 thousand                 
  dollars.  He  pointed out  that the language  in Section  12                 
  refers  only  to "equity  management  fees" and  should also                 
  include  "custody  fees".    All   expenses  are  paid  from                 
  corporate receipts originating from the fund.                                
                                                                               
  NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF                 
  MANAGEMENT  AND BUDGET, OFFICE  OF THE  GOVERNOR, referenced                 
  the supplemental bill and the sectional analysis which would                 
  incorporate  the   changes  recommended  in   the  amendment                 
  submitted by the Governor.                                                   
                                                                               
  (Tape Change, HFC 94-35, Side 2).                                            
                                                                               
  Co-Chair  MacLean  provided   the  Committee  with   capital                 
  appropriation   budget   information.     Identification  of                 
  unobligated  general   funds  existing  from   past  capital                 
  appropriations  including  all  federal   authorization  has                 
  begun.   She said repeals will not have an effect on capital                 
  dollars which have already been encumbered.  There will be a                 
  "window of  opportunity" allowing state agencies to encumber                 
  and expend balances until June 30, 1994.   She added that to                 
  date,   $80  million   dollars   has   been  identified   as                 
  unobligated,  unexpended general  funds  still on  the books                 
  appropriated prior to July, 1990.  This information  will be                 
  provided to all House Finance Committee members.                             
                                                                               
  Ms.  Slagle provided  a sectional  overview of  HB 455,  the                 
  Supplemental legislation.                                                    
                                                                               
  GOVERNOR'S OFFICE                                                            
                                                                               
       *    Sec. 1    Office  of  Management   and  Budget   -                 
                      $1,621.4 million dollars                                 
                                                                               
            This  request  would  provide  salary  adjustments                 
            required to  comply with the Fair  Labor Standards                 
            Act.                                                               
                                                                               
  DEPARTMENT OF ADMINISTRATION                                                 
                                                                               
       *    Sec. 2    Longevity   Bonus   Grants   -  $2,191.3                 
                      million dollars                                          
                                                                               
            This  request would  provide  funds to  assist  an                 
            increased number of recipients.                                    
                                                                               
  SHARON BARTON, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT                 
  OF ADMINISTRATION, explained the initial budget was based on                 
  an estimate.   Program changes  this past year  have created                 
  unpredictability in program behavior.   The request reflects                 
                                                                               
                               12                                              
                                                                               
                                                                               
  participants  over and  above  those  anticipated  when  the                 
  budget was written.                                                          
                                                                               
  HB  441  and  HB 455  were  HELD  in  Committee for  further                 
  discussion.                                                                  
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  The meeting adjourned at 3:30 P.M.                                           
                                                                               
                                                                               
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