Legislature(2011 - 2012)HOUSE FINANCE 519

01/31/2011 09:00 AM FINANCE

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09:03:51 AM Start
09:04:31 AM HB16
09:35:14 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Please Note Time Change --
Moved Out of Committee
                  HOUSE FINANCE COMMITTEE                                                                                       
                     January 31, 2011                                                                                           
                         9:03 a.m.                                                                                              
9:03:51 AM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Stoltze called the  House Finance Committee meeting                                                                    
to order at 9:03 a.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Representative Bill Stoltze, Co-Chair                                                                                           
Representative Bill Thomas Jr., Co-Chair                                                                                        
Representative Anna Fairclough, Vice-Chair                                                                                      
Representative Mia Costello                                                                                                     
Representative Mike Doogan                                                                                                      
Representative Bryce Edgmon                                                                                                     
Representative David Guttenberg                                                                                                 
Representative Reggie Joule                                                                                                     
Representative Mark Neuman                                                                                                      
Representative Tammie Wilson                                                                                                    
MEMBERS ABSENT                                                                                                                
Representative Les Gara                                                                                                         
ALSO PRESENT                                                                                                                  
Marie  Darlin, Coordinator,  Alaska  Association of  Retired                                                                    
Persons  (AARP)  Capital   City  Taskforce,  Juneau;  Denise                                                                    
Daniello,  Executive Director,  Alaska Commission  on Aging,                                                                    
Department  of Health  and Social  Services; Ronald  Kreher,                                                                    
Acting Director,  Division of Public  Assistance, Department                                                                    
of  Health  and  Social Services;  James  Armstrong,  Staff,                                                                    
Representative Bill Stoltze.                                                                                                    
PRESENT VIA TELECONFERENCE                                                                                                    
Representative   Mike  Hawker,   Sponsor;  Robin   Stilwell,                                                                    
Director, Department of Advocacy  and Agency Relations, Food                                                                    
Bank of Alaska, Anchorage.                                                                                                      
HB 16     EXTEND SENIOR BENEFITS PAYMENT PROGRAM                                                                                
          HB 16 was REPORTED OUT of committee with a "Do                                                                        
          Pass" recommendation and attached new fiscal note                                                                     
          by the Department of Health and Social Services.                                                                      
HOUSE BILL NO. 16                                                                                                             
     "An Act extending senior benefits."                                                                                        
9:04:31 AM                                                                                                                    
REPRESENTATIVE  MIKE HAWKER,  SPONSOR (via  teleconference),                                                                    
provided an  overview of the legislation.  He explained that                                                                    
the  bill  would  extend  the sunset  date  for  the  senior                                                                    
benefits payment  program. He detailed that  the program was                                                                    
established  in  2007 and  would  sunset  on June  30,  2011                                                                    
unless  re-authorized. He  reported that  in December  2010,                                                                    
there  were   10,093  senior   Alaskans  across   the  state                                                                    
receiving  the   benefits.  The  average  age   of  Alaskans                                                                    
receiving  the benefits  was 75  years old;  the oldest  was                                                                    
105.  The  program  provides  a   monthly  cash  stipend  to                                                                    
residents aged  65 years and  older with very  low household                                                                    
income.  The three-tiered  program is  based on  the federal                                                                    
poverty  guidelines (FPG).  Individuals  with  income of  75                                                                    
percent or  less of  the FPG receive  $250 per  month; those                                                                    
with income  between 75 and  100 percent of the  FPG receive                                                                    
$175 per  month; and those  with income between 100  and 175                                                                    
percent of the FPG receive $125 per month.                                                                                      
Representative  Hawker  emphasized  that  HB  16  would  not                                                                    
change the  structure of the  program or any of  the benefit                                                                    
amounts;  it would  only extend  the program  for more  four                                                                    
years.  He added  that the  federal guidelines  were updated                                                                    
annually by the U.S. government,  so there was an element of                                                                    
adjustment  built  into  the  program.  He  noted  that  the                                                                    
program has been well received by the senior community.                                                                         
Representative  Hawker pointed  to the  fiscal note  showing                                                                    
that the  program costs the state  approximately $20 million                                                                    
per year. He referred to  a provision in statute stipulating                                                                    
that when  funding was insufficient  to meet the  demands of                                                                    
the program,  the Department of  Health and  Social Services                                                                    
(DHSS)  was authorized  to reduce  or eliminate  the benefit                                                                    
available to  recipients. He called the  program "nimble and                                                                    
9:07:55 AM                                                                                                                    
Representative  Hawker  noted  that  the  benefit  reduction                                                                    
provision  along  with  the  sunset  date  gave  legislators                                                                    
assurance that  the program  would not  become viewed  as an                                                                    
entitlement. He stated that  Alaskan seniors understand that                                                                    
the program would  be in existence as long as  the state had                                                                    
the fiscal  means to  fund it.  Given current  and projected                                                                    
fiscal  circumstances in  the state,  he  believed that  the                                                                    
program merited extension for the next four years.                                                                              
Co-Chair Stoltze noted discussion regarding the bill.                                                                           
Co-Chair Stoltze opened public testimony.                                                                                       
MARIE  DARLIN, COORDINATOR,  ALASKA  ASSOCIATION OF  RETIRED                                                                    
PERSONS (AARP)  CAPITAL CITY  TASK FORCE,  JUNEAU, testified                                                                    
in support of the legislation.  She pointed to a January 28,                                                                    
2011 letter  of support from  AARP (copy on  file) detailing                                                                    
the  organization's  support,  emphasizing that  AARP  wants                                                                    
retirees to be  able to remain in Alaska.  She believed that                                                                    
the senior benefit  program helped seniors to  stay and that                                                                    
senior  citizens  were a  vital  part  of any  community  in                                                                    
Co-Chair Stoltze commended her work.                                                                                            
DENISE  DANIELLO, EXECUTIVE  DIRECTOR, ALASKA  COMMISSION ON                                                                    
AGING, DEPARTMENT  OF HEALTH and  SOCIAL SERVICES,  spoke in                                                                    
support of the  legislation on behalf of  the commission and                                                                    
more  than  10,000  Alaskan seniors  who  benefit  from  the                                                                    
program.  She stated  that the  program  provided a  crucial                                                                    
safety  net  for many  Alaskan  seniors.  She detailed  that                                                                    
approximately  one in  six seniors  in the  state benefitted                                                                    
from the  program. The  amount received was  not a  lot, but                                                                    
often enabled individuals to  afford basic life necessities,                                                                    
such as  food, heating  fuel, medicine, clothing,  and other                                                                    
9:12:17 AM                                                                                                                    
Ms. Daniello referred to a  recent survey of Alaskan seniors                                                                    
showing that  one in  five seniors  responding did  not have                                                                    
the financial  means to  pay for  necessities; approximately                                                                    
17.5 percent  of respondents  reported that  senior benefits                                                                    
was an  income source.  The commission believed  the program                                                                    
was good public  policy because it helped  older citizens to                                                                    
live  with dignity  and independence,  which has  a positive                                                                    
influence on their overall health and well-being.                                                                               
Co-Chair  Thomas referred  to  discussions he  had had  with                                                                    
elders who had not heard of  the program; he wondered how it                                                                    
was advertised. Ms. Daniello responded  that the Division of                                                                    
Public Assistance had  conducted a public-awareness campaign                                                                    
about  the  program.  She added  that  when  the  commission                                                                    
traveled to rural areas, it  found that some people were not                                                                    
aware  of  the  program,   which  was  communicated  to  the                                                                    
division.  She added  that  there was  a  need to  translate                                                                    
information about  the program  into various  languages. She                                                                    
stated  that there  may be  latent demand  for the  program;                                                                    
people who  are now turning 65  may not have heard  about it                                                                    
when it was established in 2007.                                                                                                
9:14:50 AM                                                                                                                    
Representative   Guttenberg  queried   outreach  to   senior                                                                    
citizens regarding the program.                                                                                                 
RONALD   KREHER,   ACTING   DIRECTOR,  DIVISION   OF   PUBIC                                                                    
ASSISTANCE,  DEPARTMENT  OF   HEALTH  AND  SOCIAL  SERVICES,                                                                    
responded  that there  had not  been  an extensive  outreach                                                                    
program since 2009,  when various media were  used to inform                                                                    
people. He  noted that  recipients typically  were contacted                                                                    
when they  became recipients  of old-age  assistance through                                                                    
public assistance.                                                                                                              
Vice-Chair  Fairclough   referred  to  the   state's  finite                                                                    
investment  in  the  program.  She   pointed  out  that  the                                                                    
Dillingham area had high poverty  and unemployment rates but                                                                    
only  seven   participants  in  the  program.   She  queried                                                                    
criteria  for  inclusion  into  the  program,  and  wondered                                                                    
whether seniority  or need affected  who got the  funds. Mr.                                                                    
Kreher  replied that  when  there  were insufficient  funds,                                                                    
across-the-board adjustments  in payments to  all recipients                                                                    
were made  rather than refusing  payment to  any individual.                                                                    
The goal was to have  every eligible individual receive some                                                                    
Vice-Chair Fairclough  summarized that there would  not be a                                                                    
request for increased appropriation  based on need, but that                                                                    
the amount would be divided  amongst the pool of recipients.                                                                    
She wanted further clarification  about how regulations were                                                                    
9:19:54 AM                                                                                                                    
Mr. Kreher  responded that there  had not been a  problem to                                                                    
date  since there  has  not been  a  need for  payment-level                                                                    
Vice-Chair Fairclough  stated concerns about  Alaska's aging                                                                    
population.  She   asked  whether  the   department  planned                                                                    
outreach in  the Dillingham area. Mr.  Kreher responded that                                                                    
any outreach conducted would be  statewide and would include                                                                    
the Dillingham area.                                                                                                            
Co-Chair Stoltze  emphasized that  benefits to  seniors were                                                                    
not being reduced. He referred  to a supplemental request by                                                                    
the governor. He agreed the discussion was relevant.                                                                            
Vice-Chair Fairclough stated that  her intent was to support                                                                    
funding  to  seniors. She  wanted  seniors  to be  aware  of                                                                    
benefits that were available to them.                                                                                           
9:22:22 AM                                                                                                                    
Representative   Joule   queried   the   position   of   the                                                                    
administration  on  the  legislation. Mr.  Kreher  responded                                                                    
that the administration supported  the legislation as it was                                                                    
currently drafted.                                                                                                              
Representative  Wilson asked  why eight  people on  the list                                                                    
were unidentified.  She wondered whether their  location was                                                                    
known. Mr. Kreher did not know the answer.                                                                                      
Representative Edgmon  queried whether more than  one senior                                                                    
in a household  could be eligible for the  funds. Mr. Kreher                                                                    
responded  that the  query was  a technical  policy question                                                                    
beyond his knowledge and offered to get more information.                                                                       
9:24:30 AM                                                                                                                    
ROBIN STILWELL, DIRECTOR, DEPARTMENT  OF ADVOCACY AND AGENCY                                                                    
RELATIONS,   FOOD    BANK   OF   ALASKA,    ANCHORAGE   (via                                                                    
teleconference), testified in support  of the bill on behalf                                                                    
of  the food  bank and  the 75  members of  the Alaska  Food                                                                    
Coalition.  She  spoke  to  the  question  of  outreach  and                                                                    
reported  that  beginning  in June  2009,  the  Alaska  Food                                                                    
Coalition,  in  conjunction  with  the  Division  of  Public                                                                    
Assistance,   began   outreach   on   senior   benefits   in                                                                    
conjunction  with food  stamp  outreach.  She noted  regular                                                                    
outreach for the program going  on in food pantries and soup                                                                    
kitchens, particularly  in the  Anchorage and  Mat-Su Valley                                                                    
Co-Chair Stoltze closed public testimony.                                                                                       
JAMES   ARMSTRONG,  STAFF,   REPRESENTATIVE  BILL   STOLTZE,                                                                    
explained  the  new  fiscal  note.   He  described  the  new                                                                    
tracking and  analysis program used for  fiscal notes, which                                                                    
had  been used  for  the first  time on  HB  16. Flaws  were                                                                    
discovered in the program; DHSS  worked with the Legislative                                                                    
Finance Division to produce a new, correct fiscal note.                                                                         
Co-Chair  Stoltze noted  that David  Teal  and Amanda  Ryder                                                                    
from Legislative Finance nodded in agreement.                                                                                   
Mr. Armstrong  continued that [in the  original fiscal note]                                                                    
the growth calculations for the  out-years had been short by                                                                    
$200,000 for  FY13, $500,000 for  FY14, and $900,000  for FY                                                                    
15.   In  addition,   the  new   fiscal  note   reflected  a                                                                    
supplemental request for $1.3 million.                                                                                          
9:27:55 AM                                                                                                                    
AT EASE                                                                                                                         
9:28:38 AM                                                                                                                    
Co-Chair Stoltze  clarified that the new  fiscal note before                                                                    
the  committee was  dated  January 28,  2011,  5:30 p.m.  He                                                                    
emphasized that  the note  reflected the  continuing support                                                                    
of   the  administration   through  the   supplemental,  and                                                                    
reiterated  that there  were not  going  to be  cuts in  the                                                                    
senior program.                                                                                                                 
Mr.  Armstrong  referred  to  a   spreadsheet  by  DHSS  and                                                                    
Legislative  Finance  ("Senior Benefits  Caseload  Summary,"                                                                    
copy on file).                                                                                                                  
Representative Wilson  queried an  increase of  $2.5 million                                                                    
between  FY12 and  FY13.  She  noted that  there  was not  a                                                                    
similar  increase  between  FY13   and  FY14.  She  wondered                                                                    
whether more  people were anticipated  to join  the program.                                                                    
Mr.  Kreher answered  that the  numbers reflected  projected                                                                    
service-population growth.                                                                                                      
Representative  Wilson asked  why other  years did  not have                                                                    
similar increases.  Mr. Kreher  responded that there  were a                                                                    
number of  factors involved. In  the out-years, it  was more                                                                    
challenging   to  project   the  number   of  seniors;   the                                                                    
population  was  anticipated to  increase  in  FY12 and  the                                                                    
department was trying to project a median line.                                                                                 
9:31:38 AM                                                                                                                    
Mr.  Armstrong explained  that  the  governor's FY12  budget                                                                    
submission showed  $20,485,300; the  new fiscal  note showed                                                                    
$1.9 million  in FY12. The  change was due to  a projection;                                                                    
the  two added  together and  compared to  FY13 amounted  to                                                                    
less of a difference.                                                                                                           
Representative  Hawker  pointed  out that  the  program  was                                                                    
needs-based and driven by  the qualifications established by                                                                    
the legislature  and by  the number of  folks who  choose to                                                                    
use the  program. He emphasized  that the fiscal  notes were                                                                    
estimates and  that the numbers  would be refined  each year                                                                    
as more accurate data became available.                                                                                         
Representative  Hawker  responded  to  an  earlier  question                                                                    
regarding more  than one  senior in  a household.  He stated                                                                    
that each  individual was considered; the  qualification was                                                                    
based   on   each   individual's   household   income.   Two                                                                    
individuals   residing   together    would   be   considered                                                                    
separately;  the household  income numbers  for the  federal                                                                    
government  would  be  adjusted  to reflect  the  number  of                                                                    
people in  the household. Therefore, both  individuals would                                                                    
qualify but  the dollar amount  would be  somewhat different                                                                    
than the amount for an individual residing alone.                                                                               
9:35:14 AM                                                                                                                    
Representative Doogan recalled  past difficulties related to                                                                    
the program and spoke in support of the legislation.                                                                            
Co-Chair Stoltze  commended Representative Hawker's  work on                                                                    
the bill.                                                                                                                       
Representative Hawker commended his staff.                                                                                      
Representative Joule  spoke in  support of  the legislation.                                                                    
He referred  to past  disagreement about  the issue  and was                                                                    
glad lessons had been learned about seniors.                                                                                    
Vice-Chair Fairclough MOVED to report HB 16 out of                                                                              
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes.                                                                                                      
HB 16 was REPORTED OUT of Committee with a "Do Pass"                                                                            
recommendation and attached new fiscal note by the                                                                              
Department of Health and Social Services.                                                                                       
The meeting was adjourned at 9:38 AM.                                                                                           

Document Name Date/Time Subjects
HB 16 Background - Related Statutes.docx HFIN 1/31/2011 9:00:00 AM
HB 16
HB 16 Fact Sheet - DHSS.docx HFIN 1/31/2011 9:00:00 AM
HB 16
HB 16 Sponsor Statement.docx HFIN 1/31/2011 9:00:00 AM
HB 16
HB 16 Support - AARP.pdf HFIN 1/31/2011 9:00:00 AM
HB 16
HB16 Support - ACoA.pdf HFIN 1/31/2011 9:00:00 AM
HB 16
HB16 Support - Public letters.pdf HFIN 1/31/2011 9:00:00 AM
HB 16
HB 16 Support - AFC.doc HFIN 1/31/2011 9:00:00 AM
HB 16
HB 16NEW FN Back up.pdf HFIN 1/31/2011 9:00:00 AM
HB 16
HB016-NEW FN DHSS-012811.pdf HFIN 1/31/2011 9:00:00 AM
HB 16
HB 16 Add'l Support.pdf HFIN 1/31/2011 9:00:00 AM
HB 16