Legislature(2011 - 2012)HOUSE FINANCE 519

03/02/2012 01:30 PM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HJR 4 CONST. AM: TRANSPORTATION FUND TELECONFERENCED
Moved CSHJR 4(FIN) Out of Committee
+= HB 78 INCENTIVES FOR CERTAIN MEDICAL PROVIDERS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 307 SUPPLEMENTAL/CAPITAL/OTHER APPROPRIATIONS TELECONFERENCED
Moved CSHB 307(FIN) Out of Committee
                  HOUSE FINANCE COMMITTEE                                                                                       
                       March 2, 2012                                                                                            
                         1:37 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
1:37:30 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Thomas  called the House Finance  Committee meeting                                                                    
to order at 1:37 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Bill Stoltze, Co-Chair                                                                                           
Representative Bill Thomas Jr., Co-Chair                                                                                        
Representative Anna Fairclough, Vice-Chair                                                                                      
Representative Mike Doogan                                                                                                      
Representative Bryce Edgmon                                                                                                     
Representative Les Gara                                                                                                         
Representative David Guttenberg                                                                                                 
Representative Reggie Joule                                                                                                     
Representative Mark Neuman                                                                                                      
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Mia Costello                                                                                                     
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Pete  Ecklund,  Staff,   Representative  Bill  Thomas;  Joan                                                                    
Brown, Staff,  Representative Bill Thomas;  James Armstrong,                                                                    
Staff,  Representative  Bill   Stoltze;  Representative  Bob                                                                    
Herron;  Representative  Dan Saddler;  Representative  Peggy                                                                    
Wilson,  Sponsor;  Rebecca   Rooney,  Staff,  Representative                                                                    
Peggy  Wilson;   Joe  Michel,  Staff,   Representative  Bill                                                                    
Stoltze;  Representative Bob  Herron, Sponsor;  Liz Clement,                                                                    
Staff,  Representative Bob  Herron;  Marie Darlin,  American                                                                    
Association  of   Retired  Persons-Alaska;   Patricia  Carr,                                                                    
Director,   Health   Planning   and   Systems   Development,                                                                    
Department of Health and Social Services.                                                                                       
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Christine  Potter,  President,   Alaska  Nurse  Practitioner                                                                    
Association;  Debbie  Thompson, Executive  Director,  Alaska                                                                    
Nurses  Association;  Mary  Sullivan,  Alaska  Primary  Care                                                                    
Association.                                                                                                                    
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HJR 4     CONST. AM: TRANSPORTATION FUND                                                                                        
                                                                                                                                
          CSHJR 4(FIN) was REPORTED out  of committee with a                                                                    
          "no  recommendation"  and   with  one  new  fiscal                                                                    
          impact note  from the Office  of the  Governor and                                                                    
          one  new   zero  note   from  the   House  Finance                                                                    
         Committee for the Department of Revenue.                                                                               
                                                                                                                                
HB 78     INCENTIVES FOR CERTAIN MEDICAL PROVIDERS                                                                              
                                                                                                                                
          HB 78 was HEARD and  HELD in Committee for further                                                                    
          consideration.                                                                                                        
                                                                                                                                
HB 307    SUPPLEMENTAL/CAPITAL/OTHER APPROPRIATIONS                                                                             
                                                                                                                                
          CSHB 307(FIN)  was REPORTED out of  committee with                                                                    
          a  "do pass"  recommendation  and  with no  fiscal                                                                    
          notes.                                                                                                                
                                                                                                                                
HOUSE BILL NO. 307                                                                                                            
                                                                                                                                
     "An  Act  making supplemental  appropriations,  capital                                                                    
     appropriations,  and   other  appropriations;  amending                                                                    
     appropriations;   repealing    appropriations;   making                                                                    
     appropriations to  capitalize funds; and  providing for                                                                    
     an effective date."                                                                                                        
                                                                                                                                
1:37:51 PM                                                                                                                    
                                                                                                                                
Co-Chair  Stoltze  MOVED  to   ADOPT  a  proposed  committee                                                                    
substitute  for  HB  307, Work  Draft  27-GH2601\B  (Martin,                                                                    
3/1/12). There being NO OBJECTION, it was so ordered.                                                                           
                                                                                                                                
PETE ECKLUND,  STAFF, REPRESENTATIVE BILL THOMAS  pointed to                                                                    
a ten  page document  prepared by  the Office  of Management                                                                    
and  Budget (OMB):  "FY12  Supplemental  Schedule" (copy  on                                                                    
file).  He  addressed  the operating  portion  and  language                                                                    
section  initially.  The  following items  changed:  item  2                                                                    
included  a  $50  thousand reduction  from  the  initial  $1                                                                    
million request for the Public Defender Agency.                                                                                 
                                                                                                                                
1:40:50 PM                                                                                                                    
                                                                                                                                
Mr. Ecklund explained that the  four co-chairs from both the                                                                    
House  and  Senate  Finance Committees  worked  together  to                                                                    
create the  committee substitute. He explained  that reduced                                                                    
or removed  items may be  funded later in the  session using                                                                    
another  vehicle. He  stressed  that those  items that  were                                                                    
removed  or  reduced   might  come  up  again   in  a  later                                                                    
supplemental request.                                                                                                           
                                                                                                                                
Representative Doogan  clarified that item 2  remained in HB                                                                    
307, but was reduced by $50 million.                                                                                            
                                                                                                                                
Mr.  Ecklund  responded  in  the  affirmative.  Item  4  was                                                                    
reduced by $100  thousand of authority. He  mentioned a note                                                                    
from  the  Legislative  Finance Division  (LFD)  questioning                                                                    
whether the full request could  be expended in the remainder                                                                    
of  the FY  12 fiscal  year, which  prompted the  reduction.                                                                    
Item 6,  a request for  $3,439,800 in general  fund receipts                                                                    
to  the  Department  of  Commerce,  Community  and  Economic                                                                    
Development (DCCED)  was removed. Item 7  included a request                                                                    
for $250 thousand for receipt  supported services, which was                                                                    
granted, but  the funding sources were  changed. The sources                                                                    
were split  and $210 thousand remained  as Receipt Supported                                                                    
Services (RSS)  and $40 thousand consisted  of general funds                                                                    
from   corporate  business   licensing  receipts.   Item  10                                                                    
included a  request from Department  of Education  and Early                                                                    
Development (DEED) for $1 million,  and the item was removed                                                                    
pending further discussions with  the subcommittee chair and                                                                    
LFD.                                                                                                                            
                                                                                                                                
1:43:41 PM                                                                                                                    
                                                                                                                                
Mr. Ecklund continued  with items 15 and 16,  which had been                                                                    
funded with alternate funding sources  and were moved to the                                                                    
language  section of  HB 307.  Item 22  on page  3 for  $250                                                                    
thousand to  replace unrealized  program receipts  at Alaska                                                                    
Vocational  Technical Center  (AVTEC) was  removed. Item  24                                                                    
included $600,000  for fast ferry  litigation. The  item was                                                                    
approved and moved  to the language section of  the bill and                                                                    
became a multi-year appropriation  encompassing FY 12 and FY                                                                    
13. Item 25 was approved,  but $300,000 was relocated to the                                                                    
language section and funding was  divided into multiple year                                                                    
increments, again  for FY 12 and  FY 13. He moved  to page 9                                                                    
of  the   spreadsheet.  Item  78   included  a   request  by                                                                    
Department of Corrections (DOC)  for reappropriation of $100                                                                    
thousand  for the  Highland Mountain  Center Land  Transfer.                                                                    
The item was removed  for further investigation to determine                                                                    
whether  DOC  was  the correct  department  to  receive  the                                                                    
funds.  He pointed  to  item  80, with  a  total request  of                                                                    
$20,770,800.  He noted  that $20  million  was removed  from                                                                    
item 80, an optional  retirement program for the university.                                                                    
He  stated  that  the  funding  was  removed  to  allow  for                                                                    
discussions about alternative funding sources.                                                                                  
                                                                                                                                
1:46:34 PM                                                                                                                    
                                                                                                                                
Representative  Guttenberg  asked   whether  the  university                                                                    
settlement had been finalized.                                                                                                  
                                                                                                                                
Mr.  Ecklund responded  in  the  affirmative. He  elaborated                                                                    
that  the item  might be  approved  in the  near future.  He                                                                    
moved  on to  item  89 on  page 10  of  the spreadsheet.  He                                                                    
pointed out  that a provision  existed in the  original bill                                                                    
stating that  additional unspent funding was  swept into the                                                                    
budget  reserve fund  in FY  12. The  provision was  removed                                                                    
from   the  bill,   but  would   be   considered  in   other                                                                    
appropriation bills. The effective  date of the bill changed                                                                    
to March 15.                                                                                                                    
                                                                                                                                
JOAN  BROWN, STAFF,  REPRESENTATIVE  BILL THOMAS,  discussed                                                                    
that some  "negative" supplemental  items were added  to the                                                                    
language  section of  the bill  totaling $715  thousand. The                                                                    
reason for the negative items  was to address funds given to                                                                    
the agencies  for FY12  for new  positions. She  stated that                                                                    
DCCED had  $84,100 in  economic development.  The Department                                                                    
of Health and  Social Services (DHSS) lost  $200 thousand in                                                                    
front-line social  workers and $250 thousand  in nursing for                                                                    
positions  remaining vacant.  She  noted  Department of  Law                                                                    
(DOL) lost  $21,100 for vacancy  in criminal  appeal special                                                                    
litigation and  $53,800 for a new  child protection attorney                                                                    
and paralegal. She mentioned the  $96,200 vacancy related to                                                                    
a fiscal  note for SB 58,  which passed the prior  year. She                                                                    
noted that  the Department of Military  and Veterans Affairs                                                                    
(DMVA),  $10 thousand  was removed  from the  legislation in                                                                    
the army guard maintenance component.                                                                                           
                                                                                                                                
1:49:26 PM                                                                                                                    
                                                                                                                                
Ms. Brown pointed  to other changes in  the legislation. The                                                                    
governor's  original supplemental  bill  included a  request                                                                    
for  $2,620,300 to  fully fund  the Low  Income Home  Energy                                                                    
Assistance  Program  (LIHEAP)  appropriations.  The  request                                                                    
included two  contingency appropriations for FY  12 totaling                                                                    
$8   million.   The    contingency   language   was   deemed                                                                    
ineffective. The supplemental  bill repealed the contingency                                                                    
appropriations and instead appropriated  a flat $8.5 million                                                                    
reducing the  supplemental budget by $2  million. The amount                                                                    
fully  funded  the  department's  expected  energy  assisted                                                                    
heating  costs.  She pointed  to  the  disaster relief  fund                                                                    
located  in  the  fund capitalization  (Section  14),  which                                                                    
increased from $3 million to  $5 million in conjunction with                                                                    
the  governor's amendment  received  on March  1, 2012.  She                                                                    
pointed  out a  new  repeals section  in  Section 16,  which                                                                    
included  an  unworkable LIHEAP  contingency  appropriation.                                                                    
The lapse and retroactivity were adjusted accordingly.                                                                          
                                                                                                                                
Mr. Ecklund explained that the  changes discussed were found                                                                    
in  the operating  and  language sections  of  the bill.  He                                                                    
pointed out  that James Armstrong  would detail  the capital                                                                    
portions of the bill.                                                                                                           
                                                                                                                                
JAMES   ARMSTRONG,  STAFF,   REPRESENTATIVE  BILL   STOLTZE,                                                                    
pointed  to   pages  7  and   8  of  the   OMB  supplemental                                                                    
spreadsheet. Projects  55 through  72 were removed  from the                                                                    
bill and would  probably be included in  the capital budget.                                                                    
He  pointed to  page 10  of HB  307, which  included capital                                                                    
budget  items. Items  12  through 18  addressed  a grant  to                                                                    
Anchorage  to   replace  a  fire  and   rescue  station.  He                                                                    
continued  that  items  16  through  18  included  emergency                                                                    
repairs to the Cordova hospital.  He mentioned that lines 28                                                                    
through 30  were included in  the governor's  capital budget                                                                    
for  FY  13.   He  explained  that  his office  received  an                                                                    
amendment from OMB to accelerate the item.                                                                                      
                                                                                                                                
1:53:38 PM                                                                                                                    
                                                                                                                                
Representative  Gara asked  about  items that  had not  been                                                                    
adjusted. He pointed to page  4, item 33 of the spreadsheet.                                                                    
He surmised  that the funds  had been received from  the Red                                                                    
Dog Mine and would be spent on the Red Dog Mine.                                                                                
                                                                                                                                
Mr.  Ecklund responded  in the  affirmative. He  stated that                                                                    
the funds  were supplied by  an outside entity to  the state                                                                    
for a specific purpose.                                                                                                         
                                                                                                                                
Representative Gara  directed attention to page  3, line 23.                                                                    
He expressed that he felt like  the item would never end. He                                                                    
noted that it was less  expensive to hire in-house employees                                                                    
to do the  work that had been done by  outside attorneys. He                                                                    
expressed concern about the hourly rates of the attorneys.                                                                      
                                                                                                                                
Co-Chair Thomas heard the argument  every year. He explained                                                                    
that the Department  of Law (DOL) lost  employees and needed                                                                    
to  contract  the  prior  employees   with  expertise  on  a                                                                    
subject.  He believed  that the  labor  was contracted  only                                                                    
under limited and special cases.                                                                                                
                                                                                                                                
Representative  Gara contended  that  a  new attorney  could                                                                    
integrate  the department's  knowledge  without trouble.  He                                                                    
believed that  a new attorney  could be trained  to continue                                                                    
litigation.                                                                                                                     
                                                                                                                                
1:57:14 PM                                                                                                                    
                                                                                                                                
Mr. Armstrong  added that  backup for  the four  sections he                                                                    
had discussed were included in members' packets.                                                                                
                                                                                                                                
REPRESENTATIVE BOB  HERRON, informed  the committee  about a                                                                    
disaster  over the  winter break  regarding the  water/sewer                                                                    
line  in Bethel  that  occurred due  to  winter weather.  He                                                                    
explained  that the  cause of  the disaster  was the  winter                                                                    
weather. He  explained that the  children did not  return to                                                                    
school until  mid-January. He appealed  to the  governor and                                                                    
the co-chairs  of the  finance committees  to move  the item                                                                    
into the capital budget.                                                                                                        
                                                                                                                                
REPRESENTATIVE DAN SADDLER,  explained that excessive winter                                                                    
snow  had caused  damage to  the roof  of the  fire station,                                                                    
high density housing,  and schools in the  Eagle River area.                                                                    
He asked  for committee consideration of  the capital budget                                                                    
request, which was crucial to his community.                                                                                    
                                                                                                                                
Co-Chair Thomas  stressed the  immediate need  for attention                                                                    
to  the projects  discussed  by  Representatives Herron  and                                                                    
Saddler.                                                                                                                        
                                                                                                                                
Co-Chair Stoltze  remarked on the intentional  nature of the                                                                    
decision  to  include  the   emergency  nature  items.  Non-                                                                    
emergency items were moved to the FY 13 capital budget.                                                                         
                                                                                                                                
Co-Chair Thomas  explained that  the communities  should not                                                                    
wait for the funding for emergency items.                                                                                       
                                                                                                                                
2:01:32 PM                                                                                                                    
                                                                                                                                
Co-Chair Thomas CLOSED public testimony.                                                                                        
                                                                                                                                
Co-Chair Thomas asked whether there were any amendments.                                                                        
                                                                                                                                
Co-Chair  Stoltze  MOVED  to report  CSHB  307(FIN)  out  of                                                                    
committee with individual recommendations.                                                                                      
                                                                                                                                
Representative Gara  OBJECTED for purpose of  discussion. He                                                                    
pointed to  page 1,  line 2  of the  bill. He  discussed the                                                                    
Office  of Public  Advocacy and  would like  to see  funding                                                                    
restored for the $50 thousand requested in item 2.                                                                              
                                                                                                                                
Co-Chair Thomas  explained that funding had  been requested.                                                                    
He detailed  that the  Office of  Public Advocacy  was fully                                                                    
funded and that the new position was filled.                                                                                    
                                                                                                                                
Representative Gara  WITHDREW his OBJECTION. There  being NO                                                                    
further OBJECTION, it was so ordered.                                                                                           
                                                                                                                                
CSHB  307(FIN) was  REPORTED  out of  committee  with a  "do                                                                    
pass" recommendation and with no fiscal notes.                                                                                  
                                                                                                                                
2:04:43 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:23:03 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE JOINT RESOLUTION NO. 4                                                                                                  
                                                                                                                                
     Proposing amendments to the Constitution of the State                                                                      
     of Alaska creating a transportation infrastructure                                                                         
     fund.                                                                                                                      
                                                                                                                                
2:23:20 PM                                                                                                                    
                                                                                                                                
Co-Chair  Stoltze   discussed  that   Vice-chair  Fairclough                                                                    
chaired the subcommittee on HJR 4.                                                                                              
                                                                                                                                
Vice-chair  Fairclough  explained  that the  committee  sent                                                                    
three bills to  subcommittee in the prior  year. The members                                                                    
held hearings  throughout Alaska. The bill  received support                                                                    
from residents  for the dedication of  transportation funds.                                                                    
She   explained    that   subcommittee    suggestions   were                                                                    
incorporated into a CS that was labeled "finance."                                                                              
                                                                                                                                
Vice-chair Fairclough  MOVED to  ADOPT a  proposed committee                                                                    
substitute  for  HJR  4,  Work  Draft  27-LS0197\T  (Martin,                                                                    
3/1/12).                                                                                                                        
                                                                                                                                
Co-Chair Stoltze OBJECTED for discussion.                                                                                       
                                                                                                                                
2:24:57 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PEGGY WILSON,  SPONSOR, asked  her staff  to                                                                    
review changes in the CS.                                                                                                       
                                                                                                                                
REBECCA   ROONEY,   STAFF,  REPRESENTATIVE   PEGGY   WILSON,                                                                    
explained  that  the  changes to  remove  details  from  the                                                                    
constitutional  amendment; the  removed provisions  would be                                                                    
added to  the enabling  legislation. She  noted that  the CS                                                                    
updated specific  dates within  the legislation  and changed                                                                    
the pay-out rate. She pointed to  page 1, line 14, where the                                                                    
date was  changed and updated  for the current year.  The CS                                                                    
deleted  the  following  language  from  page  1,  lines  14                                                                    
through  16 and  page 2  lines 1  through 2  after the  word                                                                    
"from":                                                                                                                         
                                                                                                                                
     "any state  on fuel  used for  the propulsion  of motor                                                                    
     vehicles,   aircraft  and   water  craft,   less  those                                                                    
     refunds,   credits  and   collection  costs   that  are                                                                    
     provided by  law from a  registration fee levied  for a                                                                    
     motor vehicle, not  including special registration fees                                                                    
     as  provided by  law. She  noted  that page  2, line  3                                                                    
     after "funds" deleted "designated by the legislature."                                                                     
                                                                                                                                
Ms. Rooney  relayed that on page  2, line 6 after  the words                                                                    
"50  percent of  the,"  the following  language was  removed                                                                    
"state  fuel tax,  registration and  driver's license  fees,                                                                    
identification  card  fees,  studded tire  taxes  and  other                                                                    
designated." She  continued with page  2, line 2 and  line 8                                                                    
where  "6"  was  replaced  with  "7."  She  added  that  the                                                                    
following  language  was deleted  on  page  2, line  10  the                                                                    
following language "designated by law":                                                                                         
                                                                                                                                
     "For  costs  related  to motor  vehicle  licensing  and                                                                    
     registration that  are designated by law"  was deleted.                                                                    
     She noted  that page  2, line 5  added a  new sentence,                                                                    
     "the legislature shall by law  determine which fees and                                                                    
     funds are transportation related under this section."                                                                      
                                                                                                                                
Co-Chair  Stoltze  surmised  that   the  changes  allowed  a                                                                    
dedicated fund similar to the  permanent fund and the change                                                                    
would  allow  direct  appropriations or  a  dedication.  The                                                                    
legislature would  make the  appropriation decisions  on how                                                                    
the fund was implemented.                                                                                                       
                                                                                                                                
Representative Peggy Wilson replied in the affirmative.                                                                         
                                                                                                                                
Vice-chair Fairclough  clarified that  the 7 percent  was an                                                                    
"up-to"  amount   that  would  allow  flexibility   for  the                                                                    
legislature   to   set   statute  without   revisiting   the                                                                    
constitution. The change would  allow the legislature to set                                                                    
a 4  or 5 percent  pay-out rate depending on  concurrence of                                                                    
the   body.  The   constitutional   amendment  allowed   the                                                                    
dedication  of  funds  and  permitted  the  legislature  the                                                                    
greatest flexibility in management of the fund.                                                                                 
                                                                                                                                
2:29:50 PM                                                                                                                    
                                                                                                                                
Representative  Peggy  Wilson  read  a  statement  that  she                                                                    
believed would help answer any questions related to the CS:                                                                     
                                                                                                                                
     Like  the rest  of  the country,  Alaska is  challenged                                                                    
     with   maintaining,   upgrading    and   creating   new                                                                    
     transportation  infrastructure.  I  think  we  all  can                                                                    
     agree  that  we have  a  serious  shortfall in  funding                                                                    
     which  could   be  exacerbated   by  the   new  federal                                                                    
     reauthorization  bill. It  is rumored  to cut  Alaska's                                                                    
     federal funding  by at least  30%.  In 2005  the United                                                                    
     States was  ranked as number  one in the world  for our                                                                    
     transportation system.  Now, just 7 short  years later,                                                                    
     we are not  even in the top 10.   As federal funding is                                                                    
     diminishing  and  our  infrastructure is  aging  Alaska                                                                    
     needs to  shoulder more of  the responsibility  for its                                                                    
     transportation infrastructure.                                                                                             
                                                                                                                                
     HJR  4  will  put  a constitutional  amendment  to  the                                                                    
     Alaska  constitution  before  voters  to  re-instate  a                                                                    
     dedicated fund for Transportation Projects.                                                                                
                                                                                                                                
     Historians write that the  drafters of the constitution                                                                    
     were  concerned  that   dedicated  funds  would  impair                                                                    
     future legislatures from  responding to evolving public                                                                    
     needs.   However,   the    drafters   of   our   Alaska                                                                    
     Constitution    grandfathered    in    two    dedicated                                                                    
     transportation funds.  The first  was for  highways and                                                                    
     the second  was for  water and harbor  facilities. They                                                                    
     recognized   the  public   need   for  dependable   and                                                                    
     efficient transportation and that  need has only grown.                                                                    
     Testifiers  for this  bill have  agreed that  the state                                                                    
     needs a reliable revenue  stream that doesn't fluctuate                                                                    
     from year  to year.  With a  dedicated fund  Alaska can                                                                    
     implement a transportation plan  that is independent of                                                                    
     the federal government.                                                                                                    
                                                                                                                                
     In  order   to  implement  the   Alaska  Transportation                                                                    
     Infrastructure  Fund  (ATIF)  there  are  3  pieces  of                                                                    
     legislation  that need  to pass.  The  first, the  bill                                                                    
     before  you  today,  is   to  put  this  constitutional                                                                    
     amendment  on  the ballot,  second  is  to set  up  the                                                                    
     enabling  statutes that  direct  how the  fund will  be                                                                    
     administered, what  revenues will  be deposited  in the                                                                    
     fund, how  those revenues  may be  spent, and  what the                                                                    
     payout rate will be from  the fund. It will also define                                                                    
     an entity that will  evaluate projects for funding. The                                                                    
     third part will  be the bill that will  fund the corpus                                                                    
     of the  Alaska Transportation Infrastructure  Fund with                                                                    
     1 billion dollars.                                                                                                         
                                                                                                                                
     Today  we   are  hearing   HJR  4   the  constitutional                                                                    
     amendment  to  re-instate  a  dedicated  transportation                                                                    
     fund. There  is a  CS before  the committee  today that                                                                    
     has  2 substantive  changes made.  1) The  language has                                                                    
     been  modified  to  make the  constitutional  amendment                                                                    
     broad enough  so that  it will be  useful 10  years, 20                                                                    
     years and  100 years  from today.  We have  removed all                                                                    
     the  details about  which funds  will  be deposited  in                                                                    
     ATIF, and what projects can  be funded with ATIF. These                                                                    
     detailed provisions  will be in the  enabling statutes.                                                                    
     In  addition  to  making the  constitutional  amendment                                                                    
     broader so  that it will  serve into the  future, these                                                                    
     deletions  have  made  the  amendment  more  clear  and                                                                    
     concise.                                                                                                                   
                                                                                                                                
2:33:50 PM                                                                                                                    
                                                                                                                                
Representative Peggy Wilson continued to read from a                                                                            
statement:                                                                                                                      
                                                                                                                                
     The second  substantive change is  the increase  in the                                                                    
     maximum  payout rate.  I believe  that the  payout rate                                                                    
     for today  should be in  the neighborhood of 4  to 4.5%                                                                    
     not 7 %. We  do not want to chip away  at the corpus of                                                                    
     the  fund. However,  what  we don't  know  is what  the                                                                    
     payout rate should be in 20  or 30 years. I think it is                                                                    
     prudent to give the  legislature the flexibility to use                                                                    
     the fund  and still  maintain a  small growth  rate. 10                                                                    
     years ago  it would have  not been  a bad idea  to have                                                                    
     the payout  rate at  6 or  7%. We  had seen  the growth                                                                    
     rate   of  investments   up   around   the  10%   range                                                                    
     consistently.  Today's  market  is  not  as  favorable.                                                                    
     Setting the  payout rate in  statute with a  ceiling in                                                                    
     the   constitution  will   give  the   legislature  the                                                                    
     latitude to  manage the fund  in future years  based on                                                                    
     the market  of the day  while preserving the  corpus of                                                                    
     the fund.                                                                                                                  
                                                                                                                                
     In you packet you have  a list of organization who have                                                                    
     voiced  their  support  for the  Alaska  Transportation                                                                    
     Infrastructure Fund.  It is quite  a list and  they are                                                                    
     the  people we  can depend  on the  get this  amendment                                                                    
     passed by the voters in November of 2012.                                                                                  
                                                                                                                                
     Alaska  needs to  take action  now. The  future of  the                                                                    
     economic and social well-being  of Alaska's citizens is                                                                    
     critically  dependent  on   a  reliable  transportation                                                                    
     system.   This  change   to  the   state  constitution,                                                                    
     allowing a  dedicated transportation fund is  needed to                                                                    
     create and  maintain a modern,  reliable transportation                                                                    
     system for Alaska.                                                                                                         
                                                                                                                                
Co-Chair  Stoltze WITHDREW  his  OBJECTION.  There being  NO                                                                    
further OBJECTION, Work Draft 27-LS0197\T was ADOPTED.                                                                          
                                                                                                                                
Representative Neuman asked who  would decide which projects                                                                    
were funded.                                                                                                                    
                                                                                                                                
Representative  Peggy  Wilson   replied  that  the  enabling                                                                    
legislation  would determine  the body  responsible for  the                                                                    
decision regarding the funding of projects.                                                                                     
                                                                                                                                
Co-Chair  Stoltze  understood  that   the  default  was  the                                                                    
legislature and its delineation of responsibility.                                                                              
                                                                                                                                
2:36:19 PM                                                                                                                    
                                                                                                                                
Representative  Gara complimented  Representative Wilson  on                                                                    
the drafting of a dedicated  fund provision. He believed the                                                                    
dedicated funds  provision in the Alaska  Constitution was a                                                                    
wise  decision  made initially  by  the  state founders.  He                                                                    
recommended prioritized spending in the future.                                                                                 
                                                                                                                                
Representative  Peggy Wilson  commented  that  the fund  did                                                                    
have user fees connected to transportation.                                                                                     
                                                                                                                                
Co-Chair Stoltze acknowledged  the gravity of constitutional                                                                    
amendments.                                                                                                                     
                                                                                                                                
2:40:18 PM                                                                                                                    
                                                                                                                                
Representative   Doogan   agreed   that   a   constitutional                                                                    
amendment was a large  step. He believed that Representative                                                                    
Peggy Wilson had  done the best job possible.  He added that                                                                    
the  work  of  the  subcommittee  improved  the  legislation                                                                    
further. He  supported the  legislation despite  his dislike                                                                    
for the permanence of dedicated funds.                                                                                          
                                                                                                                                
Co-Chair Thomas referred to the  fisherman's fund that was a                                                                    
dedicated fund; it  had been amended from  $2500 to $10,000.                                                                    
He stated  that he would  vote to move  the bill out  of the                                                                    
finance committee.                                                                                                              
                                                                                                                                
2:43:42 PM                                                                                                                    
                                                                                                                                
Representative  Tammie Wilson  appreciated the  subcommittee                                                                    
for  its work  over  the prior  interim.  She imagined  that                                                                    
Alaskans might  be unaware of  the source  of transportation                                                                    
funds. She supposed that constituents  might be surprised to                                                                    
learn that money  gained from gas tax and  from the Division                                                                    
of Motor Vehicles went into  the general fund, as opposed to                                                                    
being used  directly on road  construction. She  opined that                                                                    
the  fund  would  not  be   necessary  if  the  funding  for                                                                    
infrastructure occurred  in the  past. She pointed  out that                                                                    
state funding was simpler than federal funding to utilize.                                                                      
                                                                                                                                
Representative   Guttenberg   discussed   a   constitutional                                                                    
committee called  "draft and  styling." The  committee would                                                                    
use an  approved idea and  rewrite it in a  succinct manner.                                                                    
He  explained  that HJR  4  was  well vetted.  He  expressed                                                                    
concern that  subsequent laws would be  written to implement                                                                    
the process established  by HJR 4. He  supported the passing                                                                    
of the  bill from  the finance  committee. He  applauded the                                                                    
sponsor for her work.                                                                                                           
                                                                                                                                
2:47:26 PM                                                                                                                    
                                                                                                                                
Vice-chair   Fairclough  pointed   out   that  the   federal                                                                    
government was working on a  reauthorization bill. She noted                                                                    
that  the  new  figures  appeared  to  be  rising,  possibly                                                                    
leading  to the  elimination  of  all metropolitan  planning                                                                    
organizations  in Alaska.  She  clarified  that the  current                                                                    
federal   legislation   retained   Alaska's   transportation                                                                    
funding formula.                                                                                                                
                                                                                                                                
Co-Chair Stoltze  believed that the federal  legislation was                                                                    
a continuing resolution.                                                                                                        
                                                                                                                                
Vice-chair   Fairclough  agreed.   She  commented   that  an                                                                    
additional piece  of federal legislation  addressed Alaska's                                                                    
funding formula for transportation.                                                                                             
                                                                                                                                
Co-Chair  Stoltze pointed  out  the  uncertainty related  to                                                                    
federal funding.                                                                                                                
                                                                                                                                
Representative   Edgmon    echoed   the    compliments   for                                                                    
Representative  Peggy  Wilson  and  her  work  on  the  very                                                                    
important legislation.                                                                                                          
                                                                                                                                
Vice-chair  Fairclough clarified  that the  structure for  a                                                                    
dedicated  fund   was  the  sole  issue   in  the  committee                                                                    
discussion. She did  not want the issue to  be confused with                                                                    
the  figure $1  billion, which  was included  in a  separate                                                                    
piece of legislation.                                                                                                           
                                                                                                                                
Co-Chair  Stoltze explained  that  HJR 4  would establish  a                                                                    
structure that would ensure gradual spending.                                                                                   
                                                                                                                                
2:51:58 PM                                                                                                                    
                                                                                                                                
Representative  Joule pointed  out  that the  Constitutional                                                                    
Budget  Reserve  (CBR)  required a  three-quarter  vote.  He                                                                    
wondered   whether  the   bill  allowed   a  mechanism   for                                                                    
expenditures on items other than transportation.                                                                                
                                                                                                                                
Representative Peggy Wilson  replied that the constitutional                                                                    
amendment  did not  allow a  mechanism  for expenditures  on                                                                    
items other than transportation.                                                                                                
                                                                                                                                
Representative Joule understood and  compared the process to                                                                    
that of  accessing the Permanent  Fund. He pointed  out that                                                                    
potential  delays might  arise  due to  the stipulations  of                                                                    
spending.                                                                                                                       
                                                                                                                                
Representative Gara asked about other dedicated funds.                                                                          
                                                                                                                                
Representative  Peggy Wilson  replied  that other  dedicated                                                                    
funds dissolved when the fuel gas tax was raised.                                                                               
                                                                                                                                
Vice-chair Fairclough pointed to  fiscal notes and mentioned                                                                    
the first  fiscal note from  the Office of the  Governor for                                                                    
elections in FY  13 for $1,500 to add the  resolution to the                                                                    
ballot. She  MOVED to strike  years FY  14 through FY  18 of                                                                    
the Department of Revenue fiscal note.                                                                                          
                                                                                                                                
Co-Chair Stoltze concurred as there  had not yet been debate                                                                    
regarding the  dedication of funds  along with the  costs of                                                                    
administering  the  funds.  The  fiscal  note  for  DOR  was                                                                    
"zeroed out."                                                                                                                   
                                                                                                                                
Vice-chair Fairclough  clarified that the fiscal  note could                                                                    
be  addressed  when an  appropriation  bill  was before  the                                                                    
committee.                                                                                                                      
                                                                                                                                
Vice-chair Fairclough  MOVED to  report CSHJR 4(FIN)  out of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony on HJR 4.                                                                              
                                                                                                                                
Representative  Joule reminded  the  committee about  public                                                                    
testimony for HJR heard in the prior year.                                                                                      
                                                                                                                                
Co-Chair Stoltze agreed.                                                                                                        
                                                                                                                                
CSHJR  4(FIN)  was REPORTED  out  of  committee with  a  "no                                                                    
recommendation"  and with  one new  fiscal impact  note from                                                                    
the Office  of the Governor and  one new zero note  from the                                                                    
House Finance Committee for the Department of Revenue.                                                                          
                                                                                                                                
3:00:28 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:03:38 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
HOUSE BILL NO. 78                                                                                                             
                                                                                                                                
     "An  Act  establishing  a loan  repayment  program  and                                                                    
     employment  incentive program  for certain  health care                                                                    
     professionals employed in the  state; and providing for                                                                    
     an effective date."                                                                                                        
                                                                                                                                
3:03:49 PM                                                                                                                    
                                                                                                                                
Co-Chair   Thomas   MOVED   to  ADOPT   proposed   committee                                                                    
substitute  for  HB  78, Work  Draft  27-LS0147\O  (Mischel,                                                                    
3/1/12).                                                                                                                        
                                                                                                                                
Co-Chair Stoltze OBJECTED for discussion.                                                                                       
                                                                                                                                
JOE  MICHEL, STAFF,  REPRESENTATIVE BILL  STOLTZE, discussed                                                                    
the changes  in the  CS. He  stated that  each of  the three                                                                    
changes involved  the addition  of the term  "advanced nurse                                                                    
practitioner"  to the  legislation.  He  explained that  the                                                                    
insertion of  the term was made  on page 7, Section  2, page                                                                    
7, Section 3 and finally page 8, Section 5.                                                                                     
                                                                                                                                
Co-Chair  Stoltze explained  that  the  legislation did  not                                                                    
increase the pool  of money, but instead  increased the pool                                                                    
of eligible people.                                                                                                             
                                                                                                                                
3:07:08 PM                                                                                                                    
                                                                                                                                
Mr.  Michel stated  that  the fiscal  note  had not  changed                                                                    
along with the CS.                                                                                                              
                                                                                                                                
Co-Chair  Stoltze WITHDREW  his  objection.  There being  NO                                                                    
further OBJECTION, Work Draft 27-LS0147\O was ADOPTED.                                                                          
                                                                                                                                
3:07:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BOB HERRON,  SPONSOR, thanked  the committee                                                                    
for hearing the  bill. He spoke about the  limited access to                                                                    
healthcare  providers in  rural  Alaska.  He explained  that                                                                    
both rural  and urban Alaskans  suffered as a result  of the                                                                    
shortage of  health care providers. The  legislation created                                                                    
a  loan  repayment  and direct  cash  incentive  program  to                                                                    
attract and  retain providers in  ten different  direct care                                                                    
professions.   He  explained   that   the   intent  of   the                                                                    
legislation  was  to  capture   new  graduates  as  well  as                                                                    
established  professionals.  He acknowledged  the  federally                                                                    
funded programs, but noted their  inadequacy. He proposed HB                                                                    
78,  which  was  designed  by  Alaskans,  for  Alaskans.  He                                                                    
pointed  out  that 47  other  states  had similar  incentive                                                                    
programs.  The  legislation  allowed  for  competition  with                                                                    
those other  states. He mentioned  the abundance  of support                                                                    
received in  the form of  letters from his  constituents and                                                                    
others around the state.                                                                                                        
                                                                                                                                
3:10:23 PM                                                                                                                    
                                                                                                                                
Representative  Neuman  talked  about  creating  competitive                                                                    
opportunities  to incentivize  an  increase  in health  care                                                                    
professionals in Alaska. He wondered  if the incentive might                                                                    
lower medical costs paid by Alaskans.                                                                                           
                                                                                                                                
Representative Herron appreciated  the question. He admitted                                                                    
that  he  did  not  have  the  answer  to  that  very  large                                                                    
question.                                                                                                                       
                                                                                                                                
Representative  Neuman expressed  his goal  of understanding                                                                    
the investment for  Alaska. He pointed out page  2, line 17,                                                                    
which  stated a  lifetime  maximum period  of  12 years  for                                                                    
participation in the program. He  asked how the 12-year time                                                                    
period was selected.                                                                                                            
                                                                                                                                
LIZ CLEMENT,  STAFF, REPRESENTATIVE BOB HERRON,  pointed out                                                                    
page 3, line  13 stating "the department  may approve loaner                                                                    
payment and direct incentive programs  for an initial period                                                                    
of 3 years,"  which would allow an  applicant to participate                                                                    
in  the  program  for  six years.  The  number  was  derived                                                                    
following  conversations with  health  care providers  faced                                                                    
with  recruiting  professionals  as  well  as  professionals                                                                    
faced  with the  repayment  of loans.  The  maximum was  six                                                                    
years,  except  for  very few  select  individuals  who  may                                                                    
return to  school for further certification  may be eligible                                                                    
for an  additional six years.  She provided an example  of a                                                                    
nurse  who was  eligible for  the six-year  limit, and  then                                                                    
chose to attend  medical school, would be  then eligible for                                                                    
an additional six years.                                                                                                        
                                                                                                                                
Representative Neuman  asked about page 4,  lines 17 through                                                                    
23,  which  discussed the  amounts  of  annual payments  for                                                                    
professionals.   He  assumed   that   the  amount   provided                                                                    
recordable income for the professionals.                                                                                        
                                                                                                                                
Representative Herron replied in the affirmative.                                                                               
                                                                                                                                
Representative  Neuman asked  about an  opportunity for  one                                                                    
health  professional to  qualify for  more than  one section                                                                    
since some were specialized.                                                                                                    
                                                                                                                                
Ms.  Clement responded  that a  professional may  chose only                                                                    
one section at  a time. She noted that the  bill allowed the                                                                    
Department  of   Health  and  Social  Services   (DHSS)  the                                                                    
latitude  to develop  regulations that  specified procedures                                                                    
and eligibility details for the program.                                                                                        
                                                                                                                                
3:16:49 PM                                                                                                                    
                                                                                                                                
Vice-chair  Fairclough asked  about the  dollar amounts  for                                                                    
loan repayments and how they  were constructed. She wondered                                                                    
how  the  plan compared  to  other  states offering  similar                                                                    
incentive programs.                                                                                                             
                                                                                                                                
Ms.  Clement  replied  that the  workgroup  responsible  for                                                                    
providing   the  concept   proposal   for  the   legislation                                                                    
considered factors  such as  educational cost  standards and                                                                    
pay scale  ranges across the  nation. She  provided examples                                                                    
of lengthy and expensive  educational routes for physicians,                                                                    
dentists,  and pharmacists.  She  stated  that each  state's                                                                    
program was  different and  tailored to  its own  needs. The                                                                    
dollar amounts listed in HB 78  tended to land in the middle                                                                    
upon comparison  to the other states  with similar incentive                                                                    
programs.                                                                                                                       
                                                                                                                                
Co-Chair  Stoltze recalled  that the  bill nearly  passed in                                                                    
2010,  but  questions  regarding  cost retained  it  in  the                                                                    
finance committee.                                                                                                              
                                                                                                                                
Representative   Wilson   asked   about   cost   of   living                                                                    
adjustments to the amounts listed in the bill.                                                                                  
                                                                                                                                
Represented  Herron replied  that the  amounts were  set and                                                                    
not available for adjustment.                                                                                                   
                                                                                                                                
Representative  Wilson  queried  the difference  between  an                                                                    
advanced nurse practitioner and a nurse practitioner.                                                                           
                                                                                                                                
Co-Chair Stoltze asked to defer  the question to the nursing                                                                    
representative scheduled to testify later in the meeting.                                                                       
                                                                                                                                
Representative   Neuman  understood   the  issue   regarding                                                                    
difficulty  recruiting medical  professionals in  Alaska. He                                                                    
wondered   about  other   state   programs  addressing   the                                                                    
recruitment  of  medical  professionals. He  wondered  about                                                                    
total state spending for the medical field in Alaska.                                                                           
                                                                                                                                
Ms. Clement responded that  the Washington, Alaska, Montana,                                                                    
and  Idaho  Medical  Education Program  (WAMI)  and  Western                                                                    
Interstate Commission for Higher  Education (WICHE) were two                                                                    
additional  state  programs.  She  noted that  a  couple  of                                                                    
federally funded  programs like the National  Health Service                                                                    
Corps (NHSC)  and Indian Health Service  (IHS) also existed.                                                                    
She offered  to provide additional information  upon further                                                                    
research. She  noted that  federal funding  included federal                                                                    
requirements regarding the use of the money.                                                                                    
                                                                                                                                
3:22:04 PM                                                                                                                    
                                                                                                                                
Representative   Gara   understood  that   Alaska   required                                                                    
additional  family practice  physicians  and internists.  He                                                                    
wondered  if  any  aspect  of   the  legislation  granted  a                                                                    
priority to those high need professions.                                                                                        
                                                                                                                                
Representative Herron  replied that the board  would address                                                                    
the greatest needs.                                                                                                             
                                                                                                                                
Representative Gara  opined that  WAMI was a  great program,                                                                    
although   it  did   not  differentiate   between  high-need                                                                    
professionals compared to  lower-need medical professionals.                                                                    
He  appreciated HB  78 and  its focus  on the  needs of  the                                                                    
state.                                                                                                                          
                                                                                                                                
Co-Chair Stoltze  remarked that  the program proposed  in HB                                                                    
78 addressed  criteria pertaining to the  greatest needs for                                                                    
service in Alaska.                                                                                                              
                                                                                                                                
Representative Herron agreed with Co-Chair Stoltze.                                                                             
                                                                                                                                
Representative  Guttenberg  appreciated   that  WAMI  helped                                                                    
attain  tuition  for  medical  school,  while  HB  78  would                                                                    
recruit those professionals to Alaska.                                                                                          
                                                                                                                                
3:25:46 PM                                                                                                                    
                                                                                                                                
Representative Doogan  pointed to  language on page  5, line                                                                    
27 "may  not exceed 90 participants  annually." He requested                                                                    
further information about the limit.                                                                                            
                                                                                                                                
Representative  Herron replied  that  the  limit related  to                                                                    
cost control. The program would face review in 2019.                                                                            
                                                                                                                                
Co-Chair  Stoltze  opined that  the  money  proposed in  the                                                                    
fiscal note would not stretch far enough.                                                                                       
                                                                                                                                
3:27:40 PM                                                                                                                    
                                                                                                                                
CHRISTINE  POTTER,  PRESIDENT,   ALASKA  NURSE  PRACTITIONER                                                                    
ASSOCIATION (via  teleconference), spoke  in support  of the                                                                    
legislation.  She   explained  that  there  were   over  500                                                                    
licensed nurse  practitioners in the state.  She pointed out                                                                    
that  40  percent of  Alaskan  nurse  practitioners work  in                                                                    
medically  underserved   communities.  She  added   that  70                                                                    
percent   of  nurse   practitioners   accept  Medicare   for                                                                    
reimbursement  and 88  percent  accept  Medicaid. She  added                                                                    
that  39 percent  of nurse  practitioners practice  in rural                                                                    
areas  with  8  percent  practicing  as  the  sole  licensed                                                                    
providers in  their communities.  She spoke to  the question                                                                    
regarding    differentiation    between    advanced    nurse                                                                    
practitioners  and nurse  practitioners.  She remarked  that                                                                    
there was very little difference  between the two in Alaska.                                                                    
The two terms tend to be used interchangeably.                                                                                  
                                                                                                                                
Co-Chair Stoltze  remarked that ANP sounded  better than NP.                                                                    
Ms. Potter agreed.                                                                                                              
                                                                                                                                
DEBBIE   THOMPSON,   EXECUTIVE   DIRECTOR,   ALASKA   NURSES                                                                    
ASSOCIATION  (via teleconference),  spoke  in  favor of  the                                                                    
legislation.  She thanked  the committee  members for  their                                                                    
time.                                                                                                                           
                                                                                                                                
MARY   SULLIVAN,  ALASKA   PRIMARY  CARE   ASSOCIATION  (via                                                                    
teleconference), vocalized support for the legislation.                                                                         
                                                                                                                                
Co-Chair  Stoltze appreciated  his meeting  with the  Alaska                                                                    
Primary Care Association.                                                                                                       
                                                                                                                                
Ms. Sullivan thanked Co-Chair Stoltze.                                                                                          
                                                                                                                                
3:31:11 PM                                                                                                                    
                                                                                                                                
MARIE  DARLIN,  AMERICAN  ASSOCIATION  OF  RETIRED  PERSONS-                                                                    
ALASKA,   supported  the   legislation.  She   reminded  the                                                                    
committee that  the estimated economic value  of the seniors                                                                    
was  $1.7 billion.  She believed  that retention  of retired                                                                    
citizens in Alaska would benefit the state.                                                                                     
                                                                                                                                
Co-Chair Stoltze welcomed staff from the Soldotna hospital.                                                                     
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony.                                                                                       
                                                                                                                                
Vice-chair  Fairclough asked  whether  the  bill required  a                                                                    
participant to be an Alaskan resident.                                                                                          
                                                                                                                                
Representative Herron replied no.                                                                                               
                                                                                                                                
Vice-chair Fairclough  wondered whether the bill  required a                                                                    
participant to become an Alaskan resident.                                                                                      
                                                                                                                                
Representative Herron did not know.                                                                                             
                                                                                                                                
Vice-chair  Fairclough believed  that the  people benefiting                                                                    
from the program  should be Alaskan residents  as opposed to                                                                    
commuters.                                                                                                                      
                                                                                                                                
Co-Chair  Stoltze wondered  if  DHSS might  have included  a                                                                    
vetting requirement in its proposition.                                                                                         
                                                                                                                                
Representative  Guttenberg  pointed  to page  4,  line  2(g)                                                                    
related to  loan repayments,  "the department  shall prorate                                                                    
loan  repayments and  direct  incentives  under the  program                                                                    
based  upon a  number  of hours  of  a qualified  employment                                                                    
worked in  a quarter." He  understood the statement  to read                                                                    
that if a person commuted, their payments might be reduced.                                                                     
                                                                                                                                
Vice-chair Fairclough  remarked that  the state  was working                                                                    
to  attract   qualified  health   care  providers.   It  was                                                                    
important that  the individuals were  residents if  the bill                                                                    
paid $35,000 per  year to retire student  loans. She queried                                                                    
the intent of the legislation.                                                                                                  
                                                                                                                                
Co-Chair Stoltze requested testimony from the department.                                                                       
                                                                                                                                
PATRICIA  CARR,   DIRECTOR,  HEALTH  PLANNING   AND  SYSTEMS                                                                    
DEVELOPMENT,  DEPARTMENT  OF  HEALTH  AND  SOCIAL  SERVICES,                                                                    
replied that the bill stipulated  that the applicant must be                                                                    
licensed or exempt from state  licensing, which might relate                                                                    
to residency requirements as they relate to licensing.                                                                          
                                                                                                                                
Vice-chair Fairclough countered  that practitioners could be                                                                    
licensed in multiple states.                                                                                                    
                                                                                                                                
3:38:24 PM                                                                                                                    
                                                                                                                                
Ms. Carr  replied in the  affirmative. She thought  that the                                                                    
issue could be addressed under the program guidelines.                                                                          
                                                                                                                                
Co-Chair Stoltze  sensed Vice-chair  Fairclough's hesitation                                                                    
and asked if she had further questions.                                                                                         
                                                                                                                                
Vice-chair Fairclough replied that she  did not wish to hold                                                                    
the bill in  the finance committee. She  referred to concern                                                                    
by current  employers to  have medical  professionals remain                                                                    
in  a community.  She understood  that  the cash  incentives                                                                    
provided  that  opportunity  for  medical  professionals  as                                                                    
stated  in   HB  78.  She   hoped  that   the  professionals                                                                    
interested in the program would  remain in Alaska. She spoke                                                                    
in favor  of an  eligibility requirement within  the program                                                                    
ensuring Alaskan citizenship.                                                                                                   
                                                                                                                                
Representative   Edgmon   wondered   about   the   practical                                                                    
implications  of  a  physician  residing in  more  than  one                                                                    
state.                                                                                                                          
                                                                                                                                
Ms.  Carr replied  that  the issue  would  be considered  in                                                                    
terms  of the  application  process. She  imagined that  the                                                                    
issue would be vetted in the program guidelines.                                                                                
                                                                                                                                
3:42:29 PM                                                                                                                    
                                                                                                                                
Vice-chair  Fairclough  knew  about dentists  that  commuted                                                                    
back  and  forth to  rural  Alaska.  She  did not  know  how                                                                    
prevalent  the  occurrence  was. She  wondered  whether  the                                                                    
criteria existed in other states.                                                                                               
                                                                                                                                
Representative Doogan  clarified that a  considerable amount                                                                    
of   his  medical   treatment  was   performed  by   medical                                                                    
professionals called "travelers." He  thought that the state                                                                    
may not be  in a position to impose  a residency requirement                                                                    
and to attract as many physicians as desired.                                                                                   
                                                                                                                                
Representative Herron elaborated  that a technical amendment                                                                    
could be crafted to represent  the effort to have physicians                                                                    
become residents but  not to require it. He  agreed that the                                                                    
intent  of the  legislation was  to incentivize  a long-term                                                                    
commitment  from  medical  professionals. He  believed  that                                                                    
continuity of care was an  important contribution in medical                                                                    
care.                                                                                                                           
                                                                                                                                
3:46:50 PM                                                                                                                    
                                                                                                                                
Vice-chair  Fairclough  expressed  her interest  in  working                                                                    
with Representative  Herron on the issue.  She respected the                                                                    
need for additional medical personnel in rural Alaska.                                                                          
                                                                                                                                
Co-Chair Thomas  had grown up  in rural Alaska and  had seen                                                                    
IHS doctors  that traveled  and worked  to have  their loans                                                                    
paid off.  He expressed  concern about  the potential  for a                                                                    
provider  to receive  dual payments  from federal  and state                                                                    
sources.  He  added  that newcomers  either  appreciate  the                                                                    
state and its lifestyle or they choose to leave.                                                                                
                                                                                                                                
Representative Herron  responded that  a provider  could not                                                                    
receive dual payments; the practice was prohibited.                                                                             
                                                                                                                                
3:50:12 PM                                                                                                                    
                                                                                                                                
Representative  Neuman discussed  the competitive  nature of                                                                    
the legislation  that was  limited to  90 people.  He opined                                                                    
that the  program intention was  sound. He hoped to  see the                                                                    
benefit  to  the  state   regarding  the  potential  savings                                                                    
resulting from  the ability for patients  to receive medical                                                                    
care in-state.                                                                                                                  
                                                                                                                                
Representative  Herron replied  that  a time  period of  two                                                                    
years should determine  the interest in, and  success of the                                                                    
program. The fiscal note was  nearly $2.9 million, with $2.1                                                                    
million from  the general fund.  The remainder of  the money                                                                    
would  be contributed  by providers.  The participants  seek                                                                    
out  certain  candidates  and they  also  contribute  funds,                                                                    
making  the bill  an unusual  vehicle intended  to stabilize                                                                    
the work force in Alaska.                                                                                                       
                                                                                                                                
Co-Chair Stoltze  preferred to work  further on the  bill in                                                                    
committee.  He proposed  additional  efforts  to refine  the                                                                    
bill while  in house  finance, including  a well-constructed                                                                    
amendment.                                                                                                                      
                                                                                                                                
3:54:30 PM                                                                                                                    
                                                                                                                                
Representative   Edgmon   responded   to   a   question   by                                                                    
Representative Neuman  related to missions and  measures. He                                                                    
reminded  the  committee  that   seniors  were  the  fastest                                                                    
growing segment  of the population. He  stressed that caring                                                                    
for  the  needs of  the  seniors  was  in the  state's  best                                                                    
interest.                                                                                                                       
                                                                                                                                
Representative Doogan recommended that  the highest value be                                                                    
placed  on  attracting  qualified  doctors  and  nurses.  He                                                                    
opined   that  the   value   of   retaining  the   qualified                                                                    
practitioners was secondary.                                                                                                    
                                                                                                                                
Co-Chair  Stoltze  intended  to  schedule the  bill  at  the                                                                    
earliest possible time.                                                                                                         
                                                                                                                                
3:56:57 PM                                                                                                                    
                                                                                                                                
Representative Gara had one concern  related to the bill. He                                                                    
discussed  a   shortage  of  knee  and   heart  doctors.  He                                                                    
suggested language  stating that  a rarity of  physicians or                                                                    
nurses with a certain specialty be considered a priority.                                                                       
                                                                                                                                
Representative Herron looked forward to working with                                                                            
members on amendments.                                                                                                          
                                                                                                                                
HB 78 was HEARD and HELD in Committee for further                                                                               
consideration.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
4:00:25 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 4:00 PM.                                                                                           
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
Support Letter HJR4.doc HFIN 3/2/2012 1:30:00 PM
HJR 4
CS HJR4 WORKDRAFT FIN 27-LS0197-T-3.1.12.pdf HFIN 3/2/2012 1:30:00 PM
HJR 4
HJR004CS(TRA)-NEW FN-DOR-TRS-02-28-12.pdf HFIN 3/2/2012 1:30:00 PM
HJR 4
HB307 CS WORKDRAFT B version SUPPLEMENTAL.pdf HFIN 3/2/2012 1:30:00 PM
HB 307
HB307 Repot 3.2.12 Statewide Totals.pdf HFIN 3/2/2012 1:30:00 PM
HB 307
HB 307 SUPPLEMENTAL CS Backup.pdf HFIN 3/2/2012 1:30:00 PM
HB 307
Supplemental_Spreadsheet_1-31-12.pdf HFIN 3/2/2012 1:30:00 PM
HB 307
HB78 CS WORKDRAFT 27-LS0147-O.pdf HFIN 3/2/2012 1:30:00 PM
HB 78