Legislature(2001 - 2002)

02/27/2002 01:45 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                  HOUSE FINANCE COMMITTEE                                                                                       
                     February 27, 2002                                                                                          
                         1:45 P.M.                                                                                              
                                                                                                                                
TAPE HFC 02 - 32, Side A                                                                                                        
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Williams called the House  Finance Committee meeting                                                                   
to order at 1:45 P.M.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Bill Williams, Co-Chair                                                                                          
Representative Eldon Mulder, Co-Chair                                                                                           
Representative Con Bunde, Vice-Chair                                                                                            
Representative Eric Croft                                                                                                       
Representative John Davies                                                                                                      
Representative Richard Foster                                                                                                   
Representative John Harris                                                                                                      
Representative Bill Hudson                                                                                                      
Representative Ken Lancaster                                                                                                    
Representative Carl Moses                                                                                                       
Representative Jim Whitaker                                                                                                     
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Representative  Gretchen   Guess;  Barbara   Cotting,  Staff,                                                                   
Representative  Jeannette  James;   Linda  Sylvester,  Staff,                                                                   
Representative   Pete  Kott;   Remond  Henderson,   Director,                                                                   
Division of Administrative Services,  Department of Labor and                                                                   
Workforce  Development;  Guy   Bell,  Director,  Division  of                                                                   
Retirement and  Benefits, Department of Administration;  Chip                                                                   
Wagoner, Alaska Catholic Conference, Juneau.                                                                                    
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Karen Bitzer, Executive Director, STAR, Anchorage.                                                                              
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 20     An Act relating to state aid to municipalities and                                                                    
          certain  other  recipients,  and  for  the  village                                                                   
          public   safety   officer  program;   relating   to                                                                   
          municipal dividends;  relating to the public safety                                                                   
          foundation program;  and providing for an effective                                                                   
          date.                                                                                                                 
                                                                                                                                
          HB 20 was SCHEDULED but not HEARD.                                                                                    
                                                                                                                                
HB 56     An Act relating to minimum wages.                                                                                     
                                                                                                                                
          CS HB 56 (FIN) was reported out of Committee with                                                                     
          "individual recommendations" and with a zero                                                                          
          fiscal note #1 by Department  of Administration and                                                                   
          fiscal  note #2  by Department  of Health  & Social                                                                   
          Services.                                                                                                             
                                                                                                                                
HB 254    An Act relating to the teachers' retirement                                                                           
          system,  the judicial  retirement  system, and  the                                                                   
          public employees' retirement  system and to the tax                                                                   
          qualification  under the  Internal Revenue  Code of                                                                   
          those   systems;   amending   the   definition   of                                                                   
          'actuarial adjustment'  in the teachers' retirement                                                                   
          system   and  the   public  employees'   retirement                                                                   
          system;   repealing  certain   provisions  of   the                                                                   
          teachers'   retirement   system   and  the   public                                                                   
          employees' retirement  system; and providing for an                                                                   
          effective date.                                                                                                       
                                                                                                                                
          CS SS HB 254 (FIN) was reported out of Committee                                                                      
          with  a "do  pass" recommendation  and with  a zero                                                                   
          fiscal    note   #1    by    the   Department    of                                                                   
          Administration.                                                                                                       
                                                                                                                                
HB 262    An   Act    relating   to   accounting    for   and                                                                   
          appropriations  of receipts from fees  collected by                                                                   
          the Department  of Labor and Workforce  Development                                                                   
          for  certain inspections  and for certain  plumbing                                                                   
          and  electrical  worker  certificates  of  fitness;                                                                   
          establishing   a  building   safety  account;   and                                                                   
          providing for an effective date.                                                                                      
                                                                                                                                
          HB  262 was reported  out of  Committee with  a "do                                                                   
          pass" recommendation  and with a new fiscal note by                                                                   
          the Department of Labor & Workforce Development.                                                                      
                                                                                                                                
HB 321    An Act relating to the purpose for crime victims'                                                                     
          compensation;    prohibiting    the   payment    of                                                                   
          compensation  to  a   person  responsible  for  the                                                                   
          maintenance  of the victim  if that person  knew or                                                                   
          should have  known of the crime and  did not assist                                                                   
          the victim  or report the crime to  the police; and                                                                   
          limiting  the  factors that  may  be considered  in                                                                   
          making  a  crime  victims'  compensation  award  in                                                                   
          cases of  sexual assault, sexual abuse  of a minor,                                                                   
          or a crime involving domestic violence.                                                                               
                                                                                                                                
          CS SS HB 321 (JUD) was reported out of Committee                                                                      
          with  a "do  pass" recommendation  and with  a zero                                                                   
          fiscal note #2 by the  Department of Public Safety.                                                                   
                                                                                                                                
HOUSE BILL NO. 262                                                                                                            
                                                                                                                                
     An Act relating to accounting  for and appropriations of                                                                   
     receipts from fees collected  by the Department of Labor                                                                   
     and Workforce  Development  for certain inspections  and                                                                   
     for certain plumbing and  electrical worker certificates                                                                   
     of fitness; establishing  a building safety account; and                                                                   
     providing for an effective date.                                                                                           
                                                                                                                                
REMOND  HENDERSON,   DIRECTOR,  DIVISION  OF   ADMINISTRATIVE                                                                   
SERVICES,  DEPARTMENT  OF LABOR  AND  WORKFORCE  DEVELOPMENT,                                                                   
spoke to the revised fiscal note  for HB 262.  He stated that                                                                   
the  new note  would make  a funding  switch between  general                                                                   
fund program  receipts and the  new building safety  account.                                                                   
The FY03 amount listed is the  amount of general fund program                                                                   
receipts anticipated to be collected from fees.                                                                                 
                                                                                                                                
Representative  Whitaker asked if  the new fiscal  note would                                                                   
answer concerns previously voiced by the Committee.                                                                             
                                                                                                                                
Mr.  Henderson  explained  that  the  last  fiscal  note  had                                                                   
contained requested  positions and that those  positions were                                                                   
now being requested as part of the operating budget.                                                                            
                                                                                                                                
Vice-Chair  Bunde MOVED  to report  HB 262  out of  Committee                                                                   
with  individual recommendations  and  with the  accompanying                                                                   
new  fiscal  note.   There  being  NO  OBJECTION, it  was  so                                                                   
ordered.                                                                                                                        
                                                                                                                                
HB  262  was reported  out  of  Committee  with a  "do  pass"                                                                   
recommendation and  with a new  fiscal note by  Department of                                                                   
Labor & Workforce Development.                                                                                                  
                                                                                                                                
HOUSE BILL NO. 254                                                                                                            
                                                                                                                                
     An Act relating to the teachers'  retirement system, the                                                                   
     judicial  retirement system,  and the public  employees'                                                                   
     retirement  system and  to the  tax qualification  under                                                                   
     the  Internal Revenue  Code of  those systems;  amending                                                                   
     the   definition  of  'actuarial   adjustment'   in  the                                                                   
     teachers'  retirement system  and the public  employees'                                                                   
     retirement system;  repealing certain provisions  of the                                                                   
     teachers'  retirement system  and the public  employees'                                                                   
     retirement system; and providing  for an effective date.                                                                   
                                                                                                                                
BARBARA  COTTING,  STAFF,  REPRESENTATIVE   JEANNETTE  JAMES,                                                                   
explained   that  HB   254  is   necessary   to  ensure   tax                                                                   
qualification  of the State  of Alaska's employee  retirement                                                                   
systems, including  the Public Employee's  Retirement (PER's)                                                                   
System,  the Teacher's  Retirement  System  (TER's), and  the                                                                   
Judicial  Retirement  System   (JRS).    The  legislation  is                                                                   
technical  in   nature,  addressing  Internal   Revenue  code                                                                   
requirements necessary for continued plan qualification.                                                                        
                                                                                                                                
She  continued, enactment  of the  legislation would  benefit                                                                   
public employees  and teachers  by allowing them  to purchase                                                                   
service credit  in their retirement  plans with  transfers of                                                                   
pre-tax  savings in  certain plans  allowed  by the  Internal                                                                   
Revenue code  or payroll deductions.   The provisions  in the                                                                   
legislation  allows  for  purchases  under  the  new  federal                                                                   
pension  legislation.   Incorporation  in  Alaska statute  is                                                                   
necessary for  Alaska public employees  and teachers  to take                                                                   
advantage of.                                                                                                                   
                                                                                                                                
Vice-Chair   Bunde  MOVED   to  ADOPT   Amendment  #1,   #22-                                                                   
LS0853\F.1,  Craver, 2/27/02.   [Copy  on File].   Vice-Chair                                                                   
Bunde OBJECTED for the purpose of discussion.                                                                                   
                                                                                                                                
Vice-Chair Bunde  understood that the amendment  consisted of                                                                   
technical references.                                                                                                           
                                                                                                                                
GUY  BELL, DIRECTOR,  DIVISION  OF RETIREMENT  AND  BENEFITS,                                                                   
DEPARTMENT  OF ADMINISTRATION,  noted that  Amendment #1  was                                                                   
requested by the  Division because in the  original drafting,                                                                   
a few  sections were  missed that  needed to  be included  in                                                                   
order for  it to  be in  compliance.   The amendment  makes a                                                                   
modest adjustment  to the  title of the  bill and  makes some                                                                   
reference  changes.   Most of the  references are  associated                                                                   
with sections in statute that  allows for purchase of service                                                                   
credit  by  members.    He reiterated  that  in  the  initial                                                                   
drafting, some sections had been missed.                                                                                        
                                                                                                                                
The  pre-tax option  is done  with a  qualified tax  deferred                                                                   
plan.    The  Division  is adding  a  provision  for  special                                                                   
service agency  requirements.  He highlighted  each change to                                                                   
the statute in the amendment.                                                                                                   
                                                                                                                                
Vice-Chair  Bunde asked  if anything  in the amendment  would                                                                   
have a negative actuarial impact on the retirement system.                                                                      
                                                                                                                                
Mr. Bell  advised that there would  be no change  in benefits                                                                   
or  actuarial costs  either to  employees or  employer.   The                                                                   
only change  would  be that the  person would  be allowed  to                                                                   
purchase service with pre-taxed dollars.                                                                                        
                                                                                                                                
Representative  Davies recommended  that the drafter  address                                                                   
the issues of renumbering the bill sections.                                                                                    
                                                                                                                                
Representative  Hudson voiced  his support  for the  proposed                                                                   
legislation.  He  stated that it is necessary  and beneficial                                                                   
to the employees of the State of Alaska.                                                                                        
                                                                                                                                
Representative Foster MOVED to  report CS SS HB 254 (FIN) out                                                                   
of Committee  with  individual recommendations  and with  the                                                                   
accompanying fiscal  note.  There being NO  OBJECTION, it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
CS SS HB 254  (FIN) was reported out of Committee  with a "do                                                                   
pass"  recommendation  and  with  a fiscal  note  #1  by  the                                                                   
Department of Administration.                                                                                                   
                                                                                                                                
HOUSE BILL NO. 321                                                                                                            
                                                                                                                                
     An  Act  relating  to the  purpose  for  crime  victims'                                                                   
     compensation;  prohibiting the  payment of  compensation                                                                   
     to  a person  responsible  for  the maintenance  of  the                                                                   
     victim if that  person knew or should have  known of the                                                                   
     crime and did not assist  the victim or report the crime                                                                   
     to  the police;  and limiting  the factors  that may  be                                                                   
     considered  in  making  a  crime  victims'  compensation                                                                   
     award  in cases  of sexual  assault, sexual  abuse of  a                                                                   
     minor, or a crime involving domestic violence.                                                                             
                                                                                                                                
REPRESENTATIVE  GRETCHEN  GUESS stated  that  when the  State                                                                   
established  the Victims'  Compensation Board  over 20  years                                                                   
ago,  it  ensured the  victim's  role  in  a crime  would  be                                                                   
considered.  The unintended consequence  of that language was                                                                   
child  abuse  and  sexual assault  victims  could  be  denied                                                                   
funding if  the board found them  to have contributed  to the                                                                   
circumstances  of the  crime.   A  victim  of sexual  assault                                                                   
could  be denied  because  they were  drinking  the night  of                                                                   
their sexual assault.                                                                                                           
                                                                                                                                
Representative  Guess continued,  implying that  a victim  of                                                                   
sexual assault  somehow deserved  or played  a role  in being                                                                   
victimized,  is  in  opposition   to  what  most  communities                                                                   
believe and  that a victim of  child abuse or  sexual assault                                                                   
has not done anything to bring the crime on him or herself.                                                                     
                                                                                                                                
Toward  fixing the  unintended consequence,  the language  of                                                                   
the bill accomplishes the following:                                                                                            
                                                                                                                                
     ·    Ensures  compensation   is  not  denied   based  on                                                                   
          consideration of provocation, the use of alcohol                                                                      
          or drugs, or the prior social history of the                                                                          
          victim;                                                                                                               
     ·    Retains  the  current   language  for  compensation                                                                   
          criteria for all other crimes.                                                                                        
                                                                                                                                
Representative    Guess   commented    that   the    victim's                                                                   
compensation board is funded 60%  by State government and 40%                                                                   
by federal  government.  The funds  from the State  come from                                                                   
garnishing  felon's permanent  fund dividend  checks.   Given                                                                   
the nature  of the  funding mechanism,  the fiscal  note from                                                                   
the Department of Public Safety is zero.                                                                                        
                                                                                                                                
Vice-Chair  Bunde asked  if the  language had  been added  to                                                                   
address an incapacitated state of consciousness.                                                                                
                                                                                                                                
Representative  Guess  advised that  the  board  had not  yet                                                                   
decided about using that reasoning.                                                                                             
                                                                                                                                
Representative Whitaker  asked if in the past,  had the board                                                                   
considered  the  condition  of the  victim  when  determining                                                                   
compensation.                                                                                                                   
                                                                                                                                
Representative  Guess  advised   that  there  was  an  honest                                                                   
disagreement  between the community  and the board  regarding                                                                   
that question.   There  were some  cases where the  community                                                                   
felt  that  the board  did  do  that given  the  confidential                                                                   
nature of the  community process.  She acknowledged  that she                                                                   
did not know the specifics.                                                                                                     
                                                                                                                                
Representative Lancaster questioned  if there was a situation                                                                   
currently happening.                                                                                                            
                                                                                                                                
Representative    Guess   explained    that   the    Victims'                                                                   
Compensation Board has admitted  that is now common practice.                                                                   
                                                                                                                                
Representative  Davies interjected  that some  people in  the                                                                   
community  do  not share  that  view  with  the board.    The                                                                   
legislation  is  an  attempt  to clarify  that  this  is  the                                                                   
policy.                                                                                                                         
                                                                                                                                
Representative  Hudson  thought  that  the bill  could  be  a                                                                   
companion  piece   to  another  bill  that   was  before  the                                                                   
Committee.   He pointed out that  HB 321 deals only  with the                                                                   
victim.                                                                                                                         
                                                                                                                                
Representative Guess agreed.                                                                                                    
                                                                                                                                
Representative  Whitaker inquired  if the  board had  taken a                                                                   
position on the legislation.                                                                                                    
                                                                                                                                
Representative  Guess  noted that  there  had been  testimony                                                                   
before  the House  Judiciary  Committee by  a  member of  the                                                                   
board in  support of the bill.   She added that  the Victims'                                                                   
Compensation  Board  does  fall   into  the  preview  of  the                                                                   
Department of Public Safety.   She noted that the person from                                                                   
the  board   was  speaking   for  the   Department  and   the                                                                   
Administration.                                                                                                                 
                                                                                                                                
Representative Whitaker requested to hear any.                                                                                  
                                                                                                                                
Representative  Guess did not  know of  an opposing  point of                                                                   
view.                                                                                                                           
                                                                                                                                
Vice-Chair Bunde asked  if there would need to  be a criminal                                                                   
trial in order to qualify for compensation.                                                                                     
                                                                                                                                
Representative Guess replied that  there needs to be multiple                                                                   
criteria including  cooperating with  police, reporting  in a                                                                   
certain number of  days, etc.  It would not  necessarily have                                                                   
to be a criminal trial.  Consent  remains in the bill so that                                                                   
it can be  considered in whether  or not someone is  a victim                                                                   
of sexual abuse of a minor.                                                                                                     
                                                                                                                                
Vice-Chair Bunde  did not want to see assault  being excused,                                                                   
however, he also  did not want to take any  action that would                                                                   
reduce one's personal responsibility  for their own behavior.                                                                   
                                                                                                                                
KAREN  BITZER,   [TESTIFIED  VIA  TELECONFERNCE],   EXECUTIVE                                                                   
DIRECTOR, STANDING  TOGETHER AGAINST RAPE  (STAR), ANCHORAGE,                                                                   
testified in support of the proposed  legislation.  She noted                                                                   
that STAR works to improve services  for victims and to allow                                                                   
them to have access to tools for  recovery.  One of the goals                                                                   
of victim's  compensation is to  help make whole  the victims                                                                   
for the loss as a result of the crime.                                                                                          
                                                                                                                                
Ms. Bitzer noted  that the bill would put  the responsibility                                                                   
of the crime on  the offender.  It allows for  the victims to                                                                   
access services and intervention for available funds.                                                                           
                                                                                                                                
Representative Foster MOVED to  report CS SS HB 321 (JUD) out                                                                   
of Committee  with  individual recommendations  and with  the                                                                   
accompanying fiscal  note.  There being NO  OBJECTION, it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
CS SS HB 321  (JUD) was reported out of Committee  with a "do                                                                   
pass" recommendation  and with a  zero fiscal note #2  by the                                                                   
Department of Public Safety.                                                                                                    
                                                                                                                                
HOUSE BILL NO. 56                                                                                                             
                                                                                                                                
     An Act relating to minimum wages.                                                                                          
                                                                                                                                
Representative Hudson MOVED work  draft #22-LS0342\L, Craver,                                                                   
2/21/02, as  the version before  the Committee.   There being                                                                   
NO OBJECTION, it was adopted.                                                                                                   
                                                                                                                                
CHIP WAGONER,  ALASKA CATHOLIC CONFERENCE,  JUNEAU, testified                                                                   
in support of the minimum wage bill as proposed.                                                                                
                                                                                                                                
Mr. Wagoner  advised that the  Alaska Catholic  Conference at                                                                   
its  meeting  on  September  21,  2001,  adopted  a  petition                                                                   
supporting an increase in Alaska's minimum wage.                                                                                
                                                                                                                                
The Catholic Church's support  for a minimum wage is not new.                                                                   
The Church advocated for the establishment  of a minimum wage                                                                   
law  as early  as  1919, nearly  two  decades  prior to  its'                                                                   
passage.                                                                                                                        
                                                                                                                                
Mr.  Wagoner stated  that  minimum wages  are  paid for  work                                                                   
done.  Work is more than just a job.  Work is a way to:                                                                         
                                                                                                                                
     ·    Participate in God's creation;                                                                                        
     ·    Contribute to the common good;                                                                                        
     ·    Promote human dignity;                                                                                                
     ·    For people to meet their material needs,                                                                              
          commitments and obligations.                                                                                          
                                                                                                                                
The Church's teachings promote  the concept of a living wage,                                                                   
a wage  adequate for  workers to  provide for themselves  and                                                                   
their families in dignity.                                                                                                      
                                                                                                                                
Mr.  Wagoner pointed  out  that the  minimum  wage amount  of                                                                   
$7.15 is not  a living wage.   If a person worked  40 hours a                                                                   
week,  52 weeks  a year  at $7.15,  they  would earn  $14,872                                                                   
dollars, which  is below the  poverty threshold for  a family                                                                   
of two.   Although, he  pointed out that,  as an  increase in                                                                   
the minimum  wage is not a living  wage, it is a  step toward                                                                   
the right direction.                                                                                                            
                                                                                                                                
Mr. Wagoner concluded  that an incentive in  the minimum wage                                                                   
would disproportionately  benefit  women, minorities  and the                                                                   
nation's poor.                                                                                                                  
                                                                                                                                
Representative Davies  asked if the committee  substitute was                                                                   
identical to the initiative.                                                                                                    
                                                                                                                                
LINDA  SYLVESTER, STAFF,  REPRESENTATIVE  PETE KOTT,  replied                                                                   
that the petition  initiative was exactly contained  in HB 56                                                                   
in its  current form.   It  is the intention  of the  sponsor                                                                   
that HB 56 is identical to the  initiative petition.  Once it                                                                   
is  passed, it  would be  sufficient to  void the  initiative                                                                   
petition.                                                                                                                       
                                                                                                                                
Representative Lancaster asked  if that would be an automatic                                                                   
procedure.                                                                                                                      
                                                                                                                                
Ms. Sylvester explained  that once it is passed,  it would go                                                                   
to the  Lt. Governor  for review.   In  conjunction with  the                                                                   
Attorney General, the decision would be made.                                                                                   
                                                                                                                                
Representative Foster  MOVED to report CS HB 56  (FIN) out of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal notes.                                                                                                      
                                                                                                                                
Vice-Chair Bunde OBJECTED.  He  stated that he preferred that                                                                   
the decision  go through  the public  process weighing  in on                                                                   
the initiative process.                                                                                                         
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR:      Foster, Harris, Hudson, Lancaster, Moses,                                                                        
               Whitaker, Williams                                                                                               
OPPOSED:       Croft, Davies, Bunde                                                                                             
                                                                                                                                
Co-Chair Mulder was not present for the vote.                                                                                   
                                                                                                                                
The MOTION PASSED (7-3).                                                                                                        
                                                                                                                                
CS  HB   56  (FIN)  was   reported  out  of   Committee  with                                                                   
"individual recommendations"  and with a zero  fiscal note #1                                                                   
by  Department  of  Administration  and  fiscal  note  #2  by                                                                   
Department of Health & Social Services.                                                                                         
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 2:23 PM                                                                                            
                                                                                                                                
                                                                                                                                

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