Legislature(2003 - 2004)

04/16/2003 01:46 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                  HOUSE FINANCE COMMITTEE                                                                                       
                       April 16, 2003                                                                                           
                          1:46 PM                                                                                               
                                                                                                                                
TAPE HFC 03 - 59, Side A                                                                                                        
TAPE HFC 03 - 59, Side B                                                                                                        
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Williams called the House  Finance Committee meeting                                                                   
to order at 1:46 PM.                                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative John Harris, Co-Chair                                                                                            
Representative Bill Williams, Co-Chair                                                                                          
Representative Kevin Meyer, Vice-Chair                                                                                          
Representative Mike Chenault                                                                                                    
Representative Eric Croft                                                                                                       
Representative Richard Foster                                                                                                   
Representative Mike Hawker                                                                                                      
Representative Carl Moses                                                                                                       
Representative Bill Stoltze                                                                                                     
Representative Jim Whitaker                                                                                                     
                                                                                                                                
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Reggie Joule                                                                                                     
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Representative Berkowitz;  Tom Wright, Staff,  Representative                                                                   
John Harris; Leitoni Tupou, Special  Assistant, Department of                                                                   
Corrections; Larry  Jones, Executive Director,  Parole Board,                                                                   
Department  of  Corrections;   Johanna  Bales,  Tax  Auditor,                                                                   
Department  of  Revenue; Mike  Barnhill,  Assistant  Attorney                                                                   
General, Department of Law.                                                                                                     
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
John Robertson, Medical Director,  Department of Corrections.                                                                   
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 224    "An   Act    relating   to   a    tobacco   product                                                                   
          manufacturer's compliance with certain statutory                                                                      
          requirements regarding cigarette sales; and                                                                           
          providing for an effective date."                                                                                     
                                                                                                                                
          HB  224 was REPORTED  out of  Committee with  a "do                                                                   
          pass" recommendation  and two previously  published                                                                   
          zero  fiscal notes, #1  from the Department  of Law                                                                   
          and #2 from the Department of Revenue.                                                                                
                                                                                                                                
                                                                                                                                
HB 229    "An Act  relating to special medical  parole and to                                                                   
          prisoners   who   are    severely   medically   and                                                                   
          cognitively disabled."                                                                                                
                                                                                                                                
          CSHB 229 (FIN) was HEARD and HELD for further                                                                         
          consideration.                                                                                                        
                                                                                                                                
HOUSE BILL NO. 224                                                                                                            
                                                                                                                                
     "An  Act relating  to a  tobacco product  manufacturer's                                                                   
     compliance    with   certain   statutory    requirements                                                                   
     regarding   cigarette  sales;   and  providing   for  an                                                                   
     effective date."                                                                                                           
                                                                                                                                
MIKE  BARNHILL,  ASSISTANT ATTORNEY  GENERAL,  DEPARTMENT  OF                                                                   
LAW,  testified   in  support   of  the  bill   and  provided                                                                   
information  about  the  legislation.   He  referred  to  the                                                                   
Master  Settlement  Agreement,  initiated  in Alaska  and  45                                                                   
other states  as a result of  the 1998 settlement  of tobacco                                                                   
company  litigation.     The   Master  Settlement   Agreement                                                                   
established  a stream  of revenue that  lasts in  perpetuity.                                                                   
He noted  that Alaska's  most recent  annual payment  was for                                                                   
$17.5 million.                                                                                                                  
                                                                                                                                
Mr. Barnhill stated that the revenue  stream could however be                                                                   
reduced  under  certain circumstances.    He  noted that  one                                                                   
circumstance  was known as  a non-participating  manufacturer                                                                   
(NPM) adjustment.   He explained  that states could  avoid an                                                                   
NPM  adjustment in  two  ways:   first,  by  enacting an  NPM                                                                   
statute,  and second,  by diligently  enforcing the  statute.                                                                   
He referenced Alaska's NPM statute,  located in AS 45.53.  He                                                                   
explained that the statute creates  economic equanimity under                                                                   
the  Settlement  Agreement  between  participating  and  non-                                                                   
participating   manufacturers.      He   pointed   out   that                                                                   
participating  manufacturers  fund the  Settlement  Agreement                                                                   
revenue  stream by  raising  the prices  of  cigarettes.   He                                                                   
stated  that  the  NPM  statute   requires  non-participating                                                                   
manufacturers to  deposit money into an escrow  account based                                                                   
on cigarette sales in the state.   He noted that in FY 01 and                                                                   
02, the amount deposited equaled 1.5 cents per sale.                                                                            
                                                                                                                                
Mr. Barnhill also  addressed the enforcement  of the statute.                                                                   
He  noted that  the Department  of Revenue  sends letters  to                                                                   
non-participating manufacturers  advising them of their legal                                                                   
obligations.   If  compliance  does not  occur after  several                                                                   
letters, the manufacturers are  referred to the Department of                                                                   
Law,  and   a  lawsuit  may  be   filed  if  the   sales  are                                                                   
significant.  He  pointed out the case of a  company in India                                                                   
that did  not comply,  resulting  in a lawsuit  filed by  the                                                                   
state of Alaska.  He discussed  the difficulties of filing an                                                                   
international lawsuit,  and noted that in 2001  Alaska, along                                                                   
with  the state  of Maine,  passed complimentary  legislation                                                                   
designed  to enhance  the states'  ability  to enforce  their                                                                   
escrow  laws.     He  added   that  in  2002,   the  National                                                                   
Association of  Attorneys General  formed a working  group to                                                                   
design  model  statutes  and   encourage  uniformity  between                                                                   
states.  He stated  that the  proposed  legislation, HB  224,                                                                   
resulted from this working group.                                                                                               
                                                                                                                                
Mr. Barnhill explained  that the statute establishes  a list,                                                                   
developed by the Department of  Revenue, of the manufacturers                                                                   
and brands  of cigarettes  allowed for sale  in the  state of                                                                   
Alaska.   He noted  that to  be on the  list, a  manufacturer                                                                   
must do  one of  two things:   either  certify annually  that                                                                   
they are  a participating  manufacturer under the  Settlement                                                                   
Agreement, or a non-participating  manufacturer in compliance                                                                   
with  state law.  A distributor  may  refer to  the list  and                                                                   
determine  which brands  they may  sell.  He  noted that  the                                                                   
legislation  also provides  for provision  of information  by                                                                   
manufacturers  in  order  to monitor  compliance.    It  also                                                                   
provides penalties for non-compliance,  and addresses special                                                                   
conditions for  foreign manufacturer  enforcement.   He added                                                                   
that  the bill  provides a  tax credit  for distributors  who                                                                   
purchase a brand  of cigarettes that are later  taken off the                                                                   
list for non-compliance.                                                                                                        
                                                                                                                                
Representative Stoltze  asked for information  about statutes                                                                   
exempting  tribal entities  from  paying  taxes on  cigarette                                                                   
sales.   Mr.   Barnhill   referred   to   national   research                                                                   
investigating  Internet  sites selling  tax-free  cigarettes.                                                                   
Representative  Stoltze  referred  to the  sale  of  tax-free                                                                   
tobacco on reservations.                                                                                                        
                                                                                                                                
JOHANNA D.  BALES, TAX AUDITOR,  DEPARTMENT OF  REVENUE noted                                                                   
that  she  coordinates  the cigarette  and  tobacco  products                                                                   
excise  tax program.   She  referred  to the  passage of  the                                                                   
Native Claims  Settlement Act in 1977, and  its establishment                                                                   
of  corporation  status  for  every tribe  in  the  state  of                                                                   
Alaska.   She noted  that the only  tribe with a  reservation                                                                   
status was the  Metlakatla Indian Community,  making them the                                                                   
only native tribe  in the state that can  purchase cigarettes                                                                   
without  paying  tax.    She noted  that  the  Department  of                                                                   
Revenue  had  negotiated  with   the  tribe  and  reached  an                                                                   
agreement,  whereby  the tribe  will  collect  and pay  state                                                                   
taxes  if  their  purchase  of  tobacco  products  exceeds  a                                                                   
certain amount.  She added that  the Klawock Indian Community                                                                   
maintained 2.5  acres of Indian Country Land,  which includes                                                                   
a smoke  shop where they  can sell cigarettes  without paying                                                                   
tax.  She  concluded that Alaska differed from  others states                                                                   
in this issue, and did not experience  the same difficulties.                                                                   
                                                                                                                                
In  response  to  a question  by  Representative  Meyer,  Mr.                                                                   
Barnhill clarified  that the zero impact fiscal  notes were a                                                                   
result of existing complimentary  legislation.  He added that                                                                   
the proposed  legislation simply  updates current  procedures                                                                   
and makes enforcement easier.                                                                                                   
                                                                                                                                
Vice-Chair Meyer  asked if there was legislation  considering                                                                   
placing  a  stamp on  cigarettes  to  indicate its  place  of                                                                   
purchase.     Mr.  Barnhill   noted  that  SB   168-CIGARETTE                                                                   
SALE/DISTRIBUTION  ["An Act  relating to   .  . . payment  of                                                                   
cigarette taxes through the use  of cigarette tax stamps; . .                                                                   
."] did propose this action.                                                                                                    
                                                                                                                                
Representative  Foster   MOVED  to  report  HB   224  out  of                                                                   
Committee  with individual  recommendations and  accompanying                                                                   
fiscal notes.  There being NO OBJECTION it was so ordered.                                                                      
                                                                                                                                
HB  224  was REPORTED  out  of  Committee  with a  "do  pass"                                                                   
recommendation  and  two  previously  published  zero  fiscal                                                                   
notes,  #1  from  the  Department  of Law  and  #2  from  the                                                                   
Department of Revenue.                                                                                                          
                                                                                                                                
HOUSE BILL NO. 229                                                                                                            
                                                                                                                                
     "An Act relating to special medical parole and to                                                                          
     prisoners who are severely medically and cognitively                                                                       
     disabled."                                                                                                                 
                                                                                                                                
Representative  Harris  stated  that the  legislation  was  a                                                                   
House Finance  Committee bill, sponsored  by his office.   He                                                                   
noted  that the  legislation  related  to medical  leave  for                                                                   
disabled inmates.                                                                                                               
                                                                                                                                
TOM  WRIGHT,  STAFF,  REPRESENTATIVE   JOHN  HARRIS,  SPONSOR                                                                   
provided information  about the bill.  He explained  that the                                                                   
bill gave the  Board of Parole the ability  to grant releases                                                                   
to prisoners in  need of extreme medical services.   He noted                                                                   
that the  likelihood of re-offending  by this  population was                                                                   
quite low, since  these inmates were infirmed and  in need of                                                                   
extensive medical  assistance.   He also noted  that released                                                                   
prisoners then  became eligible for medical benefits  such as                                                                   
Medicaid and Veteran's  benefits not available  to them while                                                                   
interned.    He added  that  the  price of  providing  health                                                                   
services to  inmates was substantially  higher than  the cost                                                                   
of services available in other states or public facilities.                                                                     
                                                                                                                                
Mr.  Wright referred  to  the  fiscal notes:    one from  the                                                                   
Department  of  Corrections,  reflecting  a savings  of  $500                                                                   
thousand; one  from the Division of Public  Assistance [DHSS]                                                                   
totaling a cost  of $39.1 thousand [for FY 04];  and one from                                                                   
the Division of Medical Assistance  [DHSS] totaling a cost of                                                                   
$344.4 thousand,  $137.8 thousand of which is  a General Fund                                                                   
match.                                                                                                                          
                                                                                                                                
LARRY JONES, EXECUTIVE DIRECTOR,  PAROLE BOARD, DEPARTMENT OF                                                                   
CORRECTIONS  testified in  support  of the  legislation.   He                                                                   
identified  the  current  statute as  the  primary  mechanism                                                                   
through  which  consideration  was given  to  these  disabled                                                                   
inmates.   He stated  that the Board  had been frustrated  in                                                                   
its efforts to consider such prisoners  for parole, and noted                                                                   
that  since  1996  only  14 inmates  had  been  eligible  for                                                                   
consideration for release.                                                                                                      
                                                                                                                                
Mr.  Jones  observed  that the  proposed  legislation  opened                                                                   
certain  statutory definitions,  allowing  more prisoners  to                                                                   
receive review before  the Parole Board.  He  maintained that                                                                   
the  public  safety  factor was  very  minimal,  since  these                                                                   
inmates were  at the end stages  of their lives.   He pointed                                                                   
out that  such disabled inmates  often died soon  after their                                                                   
release.    He   contended  that  out  of   the  hundreds  of                                                                   
discretionary paroles  granted by the Board  each year, these                                                                   
persons released for medical reasons  were highly unlikely to                                                                   
recidivate.     He  stated  that   the  Board   had  recently                                                                   
promulgated its regulations assuring  notification of victims                                                                   
in  the cases  of  these releases.    He also  discussed  the                                                                   
hardship experienced  by families  of terminally  ill inmates                                                                   
and  pointed out  the  benefits  to them  from  the bill.  He                                                                   
reiterated the Board of Parole's  support of the legislation.                                                                   
                                                                                                                                
JOHN ROBERTSON, MEDICAL DIRECTOR,  DEPARTMENT OF CORRECTIONS,                                                                   
testified via  teleconference in support of  the legislation.                                                                   
He noted that  there was an increasing population  of inmates                                                                   
with terminal  illness,  particularly those  over fifty.   He                                                                   
cited the  poor medical care  that inmates may  have received                                                                   
prior  to   internment.    He   stated  that   their  current                                                                   
population had  over 400 prisoners  over the age of  fifty in                                                                   
need of medical assistance.  He  pointed out that a number of                                                                   
resources  became  available to  inmates  once  they were  no                                                                   
longer under the Department of Corrections.                                                                                     
                                                                                                                                
Mr. Robertson  also noted the  great expense to the  state of                                                                   
Alaska of providing  a correctional officer in  the community                                                                   
if an inmate  is onsite at  a hospital or clinic  while still                                                                   
under the  full jurisdiction of  the corrections system.   He                                                                   
estimated an  expense of $36 an  hour for such officers.   He                                                                   
also noted  that an average  inmate might cost  $300 thousand                                                                   
annually  just for correctional  officer  expense.  He  added                                                                   
the example  of inmates  who had family  members in  areas of                                                                   
the country  with up to 40  percent lower medical costs.   He                                                                   
reiterated  that  the  inmates  in  question  generally  died                                                                   
within six  months of their discharge.   He noted  that these                                                                   
inmates were  not in  a physical  condition where they  might                                                                   
re-offend,  requiring  assistance  simply  for  daily  living                                                                   
activities.    He  pointed  out that  inmates  would  have  a                                                                   
detailed discharge  plan, outlining  their place and  type of                                                                   
care and follow-up by parole officers.                                                                                          
                                                                                                                                
Vice-Chair   Meyer  observed   that  the   bill  would   also                                                                   
potentially pertain to violent  offenders.  He raised concern                                                                   
for the  victims' participation in  the parole process.   Mr.                                                                   
Barnhill clarified that victims  could actually attend parole                                                                   
hearings in  the case  of special medical  parole.   He noted                                                                   
that  the   bill  pertained  to   all  prisoners   under  the                                                                   
jurisdiction  of   the  state   of  Alaska,  even   those  in                                                                   
facilities located in Arizona.                                                                                                  
                                                                                                                                
LEITONI TUPOU, SPECIAL ASSISTANT,  DEPARTMENT OF CORRECTIONS,                                                                   
in  response to  a question  by  Vice-Chair Meyer,  confirmed                                                                   
that  the fiscal  note  reflected  the cost  of  transporting                                                                   
prisoners  back  to the  state  of  Alaska from  the  Arizona                                                                   
facility.                                                                                                                       
                                                                                                                                
Vice-Chair Meyer  referred to  the fiscal notes  and compared                                                                   
the  $500 decrement  in  the Governor's  budget  to the  $403                                                                   
thousand  General  Fund  match  listed  in  the  fiscal  note                                                                   
[Medical  Assistance/DHSS] for  FY  08, and  the ongoing  $78                                                                   
thousand General  Fund match.   He observed that by  the year                                                                   
2007 and  2008, the bill ceased  to generate a savings.   Mr.                                                                   
Wright  responded  that the  fiscal  note  was based  on  the                                                                   
assumption  that inmates  receiving medical  parole who  were                                                                   
then eligible  for Medicaid would  receive that service.   He                                                                   
pointed out that prisoners might  participate in other health                                                                   
benefits,  such as  native health  organization benefits,  or                                                                   
family provided  health benefits.  He noted  discussions with                                                                   
the Department  of Health and  Social Services  regarding the                                                                   
assumption  that  prisoners eligible  for  Medicaid  services                                                                   
would participate in that program.                                                                                              
                                                                                                                                
Mr.  Robertson  added that  the  average prognosis  of  these                                                                   
inmates  was three  to six months.   He  maintained that  the                                                                   
fiscal assumptions were based  on longevity of several years.                                                                   
He indicated  that fewer  inmates would  become eligible  for                                                                   
Medicaid based on  their prognoses.  He also  speculated that                                                                   
the medical  cost index  savings would  exceed $500  thousand                                                                   
annually.   He pointed  out that the  medical cost  index was                                                                   
predicted to increase in the coming year by ten percent.                                                                        
                                                                                                                                
Mr.  Jones confirmed  that the  average  life expectancy  for                                                                   
these inmates  historically did  not exceed six  months, more                                                                   
likely less than three months.                                                                                                  
                                                                                                                                
Vice-Chair Meyer  raised concern  for the strong  feelings of                                                                   
victims of  violent crimes, particularly  in cases  of sexual                                                                   
assault,  about the  fate  of their  assailants.   Mr.  Jones                                                                   
acknowledged  that these victims'  rights were highly  valued                                                                   
by the  Board of  Parole.   He also  noted that  many of  the                                                                   
inmates had  not committed  violent crimes.   He pointed  out                                                                   
that many  of them  were older  patients, and  many were  not                                                                   
ambulatory, reducing the concern over re-offence.                                                                               
                                                                                                                                
In  response to  a question  by Vice-Chair  Meyer, Mr.  Jones                                                                   
noted that the  average birth years for these  prisoners were                                                                   
between 1940 and 1950.                                                                                                          
                                                                                                                                
Representative  Stoltze   noted  Section  2,  line   17,  and                                                                   
referred to language making information  about the prisoner's                                                                   
employment  and residence addresses  unavailable to  victims.                                                                   
Mr. Jones  noted that this  resulted from statutory  cautions                                                                   
surrounding discretionary paroles.                                                                                              
                                                                                                                                
Representative Stoltze proposed  that the language be changed                                                                   
from  "may  not"  include  to  read,  "shall"  include.    He                                                                   
maintained  that   victims  had   the  right  to   know  such                                                                   
information about the released inmates.                                                                                         
                                                                                                                                
Representative Hawker  noted the absence of  information from                                                                   
victims' rights advocacy groups  expressing their position on                                                                   
the legislation.  Mr. Jones noted  that one individual from a                                                                   
victims' rights  organization in Anchorage had  testified via                                                                   
teleconference  at   the  [House]  State   Affairs  Committee                                                                   
hearing.  He  observed that their testimony  was not entirely                                                                   
negative,  and  recognized  the   Board  of  Parole's  strong                                                                   
advocacy for victims' rights.                                                                                                   
                                                                                                                                
Representative  Hawker observed  that the treatment  programs                                                                   
for  these   inmates  were   extremely  expensive,   with  an                                                                   
aggregate cost  to the State  of $1.1  million per year.   He                                                                   
suggested  that  communities  and other  services  might  not                                                                   
support  these same  costs.   He  pointed  out that  Medicaid                                                                   
might  be expected  to support  them, in  addition to  public                                                                   
assistance for living  costs.  He asked how  those costs that                                                                   
exceeded such benefits might be financed.                                                                                       
                                                                                                                                
Mr. Robertson referred to instances  when inmates traveled to                                                                   
family members in another state  and the bulk of the cost for                                                                   
their care had been borne by the  family.  He also noted that                                                                   
some  inmates might  choose  home  or end  of  life care,  as                                                                   
opposed to intensive care.  He  speculated that inmates often                                                                   
opted  for intensive  care  while  incarcerated  for fear  of                                                                   
dying within the correction system.   He discussed the effect                                                                   
         th                                                                                                                     
of  the 8   Amendment rights  of inmates  in determining  the                                                                   
standard of medical  care.  He added that the  difficulty was                                                                   
in determining  the extent of  care needed after  the inmates                                                                   
were released.   He  noted that  the state  of Alaska  paid a                                                                   
higher  rate of reimbursement  than Medicaid,  which  was not                                                                   
available to inmates while in  the Department of Corrections.                                                                   
He   reiterated  that   the  cost   of  correction   officers                                                                   
represented a substantial savings  not included in the fiscal                                                                   
notes.                                                                                                                          
                                                                                                                                
Representative  Hawker  questioned  whether the  fiscal  note                                                                   
from  the [Department  of  Health  and Social  Services]  was                                                                   
incorrect  if it did  not include  the figures pertaining  to                                                                   
correction  officers.   He suggested  that  the fiscal  notes                                                                   
were not adequately accurate or thorough.                                                                                       
                                                                                                                                
JERRY BURNETT, DIRECTOR, ADMINISTRATIVE  SERVICES, DEPARTMENT                                                                   
OF  CORRECTIONS  conceded that  the  zero savings  in  future                                                                   
years  was  an  estimate, since  they  could  not  accurately                                                                   
predict  how many  inmates  might be  released  from year  to                                                                   
year.     He  suggested  that   the  fiscal  note   might  be                                                                   
indeterminate rather than zero.                                                                                                 
                                                                                                                                
Representative    Hawker   maintained    that,   given    the                                                                   
undetermined  amounts  in the  fiscal  note,  the bill  might                                                                   
actually represent  an aggregate cost to the  state of Alaska                                                                   
rather than a savings.                                                                                                          
                                                                                                                                
Co-Chair  Harris  stated that  the  fiscal note  reflected  a                                                                   
projected savings  to the Department  of $500  thousand based                                                                   
upon  the  release  of  the  current  number  of  potentially                                                                   
eligible inmates.  He maintained  that the question was which                                                                   
agencies would  then assume  the costs  and services  for the                                                                   
released inmates.  He speculated  that some inmates might not                                                                   
present any cost  to the state, if families  assumed the cost                                                                   
of  their  care.    He  suggested   that  the  Department  of                                                                   
Corrections  could have  estimated the  future costs,  as did                                                                   
the  Department   of   Health  and  Social   Services.     He                                                                   
acknowledged  that the  focus would  be on  FY 04, since  one                                                                   
could not  accurately predict  potential savings or  costs in                                                                   
future years without knowing the number of paroled inmates.                                                                     
                                                                                                                                
TAPE HFC 03 - 59, Side B                                                                                                        
                                                                                                                                
Mr.  Burnett  suggested  that  if  his  Department  projected                                                                   
savings  in  future  years,  and   budgeted  based  on  those                                                                   
savings, and  if medical costs  were to increase,  this would                                                                   
cause a  budgetary problem.  He  explained that this  was the                                                                   
reason  for not  including projected  savings  in the  fiscal                                                                   
note.                                                                                                                           
                                                                                                                                
Co-Chair Harris observed that  the projected future costs did                                                                   
seem to offset  potential savings.  He pointed  out, however,                                                                   
that the bill  effectively gave the Parole Board  the ability                                                                   
to grant  medical leave  to a  prisoner that they  determined                                                                   
presents  no  hazard to  the  public,  due to  their  extreme                                                                   
disability.  He  maintained  that  this  presented  a  lesser                                                                   
difficulty  and  lesser cost  than  providing  care to  these                                                                   
inmates within the correctional system.                                                                                         
                                                                                                                                
Representative   Croft   suggested   that  since   the   only                                                                   
justification  for  the  possible risk  associated  with  the                                                                   
legislation was  cost savings,  it behooved the  Committee to                                                                   
review accurate fiscal notes.   He proposed that, even though                                                                   
these were cost estimates, the  Department of Corrections and                                                                   
the  Department of  Health  and Social  Services  communicate                                                                   
with   one  another   and  use   similar   bases  for   their                                                                   
projections.                                                                                                                    
                                                                                                                                
Co-Chair Harris asked if the Department  of Corrections could                                                                   
estimate  costs similarly  to  the Department  of Health  and                                                                   
Social  Services.     Mr.   Burnett  speculated   that  these                                                                   
calculations   would  be  based   upon  FY  04   assumptions,                                                                   
projected  out  using the  medical  rate  of inflation.    He                                                                   
stated that the Department could  provide such a fiscal note.                                                                   
                                                                                                                                
Co-Chair  Harris estimated  that  the first  year of  savings                                                                   
would  total approximately  $330 thousand  of general  funds.                                                                   
Mr. Burnett confirmed that the  amount would then increase by                                                                   
ten percent  per year.   He agreed to  produce such  a fiscal                                                                   
note.                                                                                                                           
                                                                                                                                
Representative  Hawker referred  to  a savings  in the  first                                                                   
year  of   roughly  $500  thousand,   based  on   13  inmates                                                                   
identified as  potential medical parolees.  He  asked whether                                                                   
this number  of potential parolees  regenerated from  year to                                                                   
year.  Mr. Tupou reiterated that,  over the past seven years,                                                                   
the Board  reviewed only 14 inmates  for medical parole.   He                                                                   
explained  that current  law  effectively  forced inmates  to                                                                   
wait until  nearly the  point of  death before coming  before                                                                   
the Board.   He noted that the proposed legislation  gave the                                                                   
Board   more   flexibility   in  when   they   could   review                                                                   
applications for medical parole.                                                                                                
                                                                                                                                
Mr. Robertson  maintained that  the issue  was not  about the                                                                   
number of potential  parolees, but rather about  the types of                                                                   
illnesses  that  require expensive  treatment.  He  expressed                                                                   
confidence  in the potential  savings of  $500 thousand.   He                                                                   
suggested that  with the increasing prison  population, there                                                                   
was not a question of whether  savings would be realized each                                                                   
year,  but that the  amount of  savings would  depend on  the                                                                   
illnesses and cost of care and not the number of inmates.                                                                       
                                                                                                                                
Representative Croft MOVED Amendment #1:                                                                                        
                                                                                                                                
     Page 2, line 14, after "because of the prisoner's":                                                                        
     INSERT "severe"                                                                                                            
                                                                                                                                
     Page 2, line 21, after "suffering from the":                                                                               
     INSERT "severe"                                                                                                            
                                                                                                                                
     Page 2, line 24, after "suffering from the":                                                                               
     INSERT "severe"                                                                                                            
                                                                                                                                
     Page 3, line 3 after "likely to remain subject to the":                                                                    
     INSERT "severe"                                                                                                            
                                                                                                                                
     Page 3, line 25, after "subject to the":                                                                                   
     INSERT "severe"                                                                                                            
                                                                                                                                
Co-Chair Harris OBJECTED.                                                                                                       
                                                                                                                                
Representative   Croft    pointed   out   that    there   was                                                                   
inconsistency in  referring to the level of  disability.  Co-                                                                   
Chair Harris REMOVED his OBJECTION.                                                                                             
                                                                                                                                
There being NO OBJECTION the amendment was ADOPTED.                                                                             
                                                                                                                                
Representative Croft MOVED Amendment #2.                                                                                        
                                                                                                                                
     Page 2, DELETE line 11.                                                                                                    
                                                                                                                                
     Page 3, line 21:                                                                                                           
          DELETE: "reduces"                                                                                                     
          INSERT: "eliminates"                                                                                                  
                                                                                                                                
Co-Chair Harris OBJECTED.                                                                                                       
                                                                                                                                
Representative Croft  noted his discomfort with  the level of                                                                   
risk  associated with  repeat offenses.   He  asked for  more                                                                   
information from the Department regarding this concern.                                                                         
                                                                                                                                
Mr.  Jones  contended  that  the   weight  of  the  decision,                                                                   
although subjective,  was placed on the board.   He explained                                                                   
that the  board's standard  was "reduces" since  "eliminates"                                                                   
constituted death of the inmate.                                                                                                
                                                                                                                                
Representative  Croft  referred to  Section  1, stating  "the                                                                   
prisoner  is incapacitated  to an  extent that  incarceration                                                                   
does not  impose additional  restrictions . .  . "   He asked                                                                   
for  clarification as  to the  citation of  criteria for  the                                                                   
likelihood  of  reoffense.     Mr.  Jones  cited  Section  1,                                                                   
subsection  2, (A)  "the  prisoner will  live  and remain  at                                                                   
liberty without  violating any laws or conditions  imposed by                                                                   
the board; and (B) "because of  the prisoner's severe medical                                                                   
or cognitive disability, the prisoner  will not pose a threat                                                                   
of harm to the public if released on parole;".                                                                                  
                                                                                                                                
Representative  Croft noted that  this language  was prefaced                                                                   
by: "a reasonable probability  exists" that the prisoner does                                                                   
not pose a threat of harm.                                                                                                      
                                                                                                                                
Mr.  Robertson  noted  that  the   initial  review  of  these                                                                   
prisoners  was first  done at  the medical  level.  He  noted                                                                   
that they  would not recommend  prisoners for  medical parole                                                                   
who had  any reasonable probability  for repeat offense.   He                                                                   
conceded that these  estimates were not infallible.   He gave                                                                   
the  example of  a  prisoner who  had  Lou Gerrig's  disease,                                                                   
which prevented  them moving from  their bed.   He maintained                                                                   
that the  risk of  such an individual  re-offending  was only                                                                   
one  percent, although  they were  not  eligible for  medical                                                                   
parole  since  they  did  not  fit  specific  criteria.    He                                                                   
suggested that  in terms of  language, it would  be difficult                                                                   
to draw the terms at 100 percent certainty.                                                                                     
                                                                                                                                
Representative  Croft WITHDREW the  amendment.  He  expressed                                                                   
his view, however, that the bill  still contained too vague a                                                                   
definition of allowable potential risk.                                                                                         
                                                                                                                                
Representative Stoltze MOVED Amendment #3.                                                                                      
                                                                                                                                
     Page 3, line 17-18                                                                                                         
                                                                                                                                
     DELETE: "However the copy of the application sent to                                                                       
     the victim may not include the prisoner's proposed                                                                         
     residence and employment addresses."                                                                                       
                                                                                                                                
     REPLACE with:  "The copy of the application sent to the                                                                    
     victim shall include the prisoner's proposed residence                                                                   
     and employment addresses."                                                                                                 
                                                                                                                                
Mr. Tupou  stated that the  Department of Corrections  had no                                                                   
objection to the language change.                                                                                               
                                                                                                                                
Co-Chair Harris asked  why the language of "may  not include"                                                                   
was originally  included  in statute.   Mr. Jones  speculated                                                                   
that  victims'  rights rose  to  the  forefront in  the  late                                                                   
nineties after this statute was  written.  He stated that the                                                                   
Board had no objection to the language change.                                                                                  
                                                                                                                                
Vice-Chair Meyer  observed that if the inmate  released was a                                                                   
sex  offender, their  address  would be  made  public in  any                                                                   
case.  He stated his support of the amendment.                                                                                  
                                                                                                                                
Co-Chair Williams WITHDREW his objection.                                                                                       
                                                                                                                                
There being NO OBJECTION the amendment was ADOPTED.                                                                             
                                                                                                                                
CSHB 229 (FIN) was HEARD and HELD  for further consideration.                                                                   
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 2:57 PM                                                                                            
                                                                                                                                

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