Legislature(2013 - 2014)HOUSE FINANCE 519

04/10/2013 01:30 PM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Continued at 7:30 p.m. Today --
+= SB 21 OIL AND GAS PRODUCTION TAX TELECONFERENCED
Scheduled But Not Heard
+= SB 18 BUDGET: CAPITAL TELECONFERENCED
Scheduled But Not Heard
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= SB 37 EXTEND SUICIDE PREVENTION COUNCIL TELECONFERENCED
Moved Out of Committee
+= SB 16 BD OF ARCHITECTS, ENGINEERS, SURVEYORS TELECONFERENCED
Moved Out of Committee
+= SB 38 STATE MEDICAL BOARD TELECONFERENCED
Moved Out of Committee
+= SB 88 ALASKA NATIVE MEDICAL CENTER HOUSING TELECONFERENCED
Heard & Held
+= SB 2 INTERSTATE MINING COMPACT & COMMISSION TELECONFERENCED
Moved Out of Committee
+= SB 24 MARINE TRANSPORTATION ADVISORY BOARD TELECONFERENCED
Moved HCS SB 24(TRA) Out of Committee
                  HOUSE FINANCE COMMITTEE                                                                                       
                      April 10, 2013                                                                                            
                         1:39 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
1:39:26 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stoltze called the  House Finance Committee meeting                                                                    
to order at 1:39 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Alan Austerman, Co-Chair                                                                                         
Representative Bill Stoltze, Co-Chair                                                                                           
Representative Mark Neuman, Vice-Chair                                                                                          
Representative Mia Costello                                                                                                     
Representative Bryce Edgmon                                                                                                     
Representative Les Gara                                                                                                         
Representative Lindsey Holmes                                                                                                   
Representative Scott Kawasaki, Alternate                                                                                        
Representative Cathy Munoz                                                                                                      
Representative Steve Thompson                                                                                                   
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative David Guttenberg                                                                                                 
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Senator Anna  Fairclough; Laura Pierre, Staff,  Senator Anna                                                                    
Fairclough;  Kate  Burkhart, Executive  Director,  Statewide                                                                    
Suicide  Prevention  Council;  Margaret  Dowling,  Staff  to                                                                    
Senator  Cathy Giessel;  David Scott,  Staff, Senator  Donny                                                                    
Olson;  Senator  Pete   Kelly,  Sponsor;  Heather  Shattuck,                                                                    
Staff,  Senator Pete  Kelly;  William Streur,  Commissioner,                                                                    
Department  of Health  and Social  Services; Angela  Rodell,                                                                    
Deputy  Commissioner,   Treasury  Division,   Department  of                                                                    
Revenue;  Valerie  Davidson,   Senior  Director,  Legal  and                                                                    
Intergovernmental  Affairs,  Alaska   Native  Tribal  Health                                                                    
Consortium  (ANTHC);  Don  Habegar,  Director,  Division  of                                                                    
Corporations,    Business   and    Professional   Licensing,                                                                    
Department of Commerce,  Community and Economic Development;                                                                    
Dave  Scott,  Staff,  Senator   Olson;  Doug  Letch,  Staff,                                                                    
Senator Gary Stevens; Senator Cathy Giessel; Ed Fogels,                                                                         
Deputy Commissioner, Department of Natural Resources.                                                                           
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Colin Maynard, Member, AELS Board, Anchorage                                                                                    
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SB  2     INTERSTATE MINING COMPACT & COMMISSION                                                                                
                                                                                                                                
          SB  2 was  REPORTED out  of committee  with a  "do                                                                    
          pass" recommendation and with  one new fiscal note                                                                    
          from  Department  of  Natural  Resources  and  one                                                                    
          previously published zero fiscal note: FN 2(ADM).                                                                     
                                                                                                                                
SB 16     BD OF ARCHITECTS, ENGINEERS, SURVEYORS                                                                                
                                                                                                                                
          SB 16  was REPORTED  out of  committee with  a "no                                                                    
          recommendation" and with  one previously published                                                                    
          fiscal note: FN2(CED).                                                                                                
                                                                                                                                
CSSB 18(FIN) am                                                                                                                 
          BUDGET: CAPITAL                                                                                                       
                                                                                                                                
          CSSB 18(FIN) am was SCHEDULED but not HEARD.                                                                          
                                                                                                                                
CSSB 21(FIN) am(efd fld)                                                                                                        
          OIL AND GAS PRODUCTION TAX                                                                                            
                                                                                                                                
          CSSB  21(FIN)  am(efd  fld)was SCHEDULED  but  not                                                                    
          HEARD.                                                                                                                
                                                                                                                                
SB 24     MARINE TRANSPORTATION ADVISORY BOARD                                                                                  
                                                                                                                                
          SB 24  was REPORTED  out of  committee with  a "do                                                                    
          pass" recommendation and with  one new fiscal note                                                                    
          from  Department  of   Transportation  and  Public                                                                    
          Facilities.                                                                                                           
                                                                                                                                
SB 37     EXTEND SUICIDE PREVENTION COUNCIL                                                                                     
                                                                                                                                
          SB 37  was REPORTED  out of  committee with  a "do                                                                    
          pass" recommendation and with  one new fiscal note                                                                    
          from Department of Health and Social Services.                                                                        
                                                                                                                                
CSSB 38(FIN)                                                                                                                    
     STATE MEDICAL BOARD                                                                                                        
                                                                                                                                
          CSSB 38(FIN) was REPORTED out of committee with a                                                                     
          "no recommendation" and with one previously                                                                           
          published fiscal impact note: FN1(CED).                                                                               
                                                                                                                                
SB 88     ALASKA NATIVE MEDICAL CENTER HOUSING                                                                                  
                                                                                                                                
          SB 88 was HEARD and HELD in committee for further                                                                     
          consideration.                                                                                                        
                                                                                                                                
1:39:42 PM                                                                                                                    
                                                                                                                                
SENATE BILL NO. 37                                                                                                            
                                                                                                                                
     "An Act extending the termination date of the                                                                              
     Statewide Suicide Prevention Council; and providing                                                                        
     for an effective date."                                                                                                    
                                                                                                                                
1:40:06 PM                                                                                                                    
                                                                                                                                
LAURA PIERRE, STAFF, SENATOR  ANNA FAIRCLOUGH, discussed the                                                                    
bill. She  stated the  recommendation of  Legislative Budget                                                                    
and Audit (LB&A)  to extend the council 6 years  to June 30,                                                                    
2019.  The  council was  comprised  of  17 members.  Senator                                                                    
Fairclough served on  the council as a  Representative and a                                                                    
Senator.  The  council  made  great  strides  in  increasing                                                                    
meeting  attendance and  implementing a  statewide strategic                                                                    
plan  for suicide  prevention  outreach  across Alaska.  The                                                                    
council's plan  was called "Casting  the Net  Upstream." The                                                                    
plan promoted the prevention of suicide in Alaska.                                                                              
                                                                                                                                
Co-Chair   Stoltze  handed   the  gavel   to  Representative                                                                    
Costello.                                                                                                                       
                                                                                                                                
Representative Costello  appreciated the  sponsor's interest                                                                    
in the issue.                                                                                                                   
                                                                                                                                
1:41:39 PM                                                                                                                    
                                                                                                                                
Representative Munoz asked how  the $415 thousand in school-                                                                    
based grants were distributed. She  asked to know more about                                                                    
the projects funded  by the grants. Ms.  Pierre deferred the                                                                    
question to Kate Burkhart.                                                                                                      
                                                                                                                                
Representative   Kawasaki  asked   about   the  LB&A   audit                                                                    
suggesting  the  board's  extension. He  asked  about  other                                                                    
recommendations  made in  the  audit.  Ms. Pierre  responded                                                                    
that  other  audit  findings  could   be  discussed  by  Ms.                                                                    
Burkhart.                                                                                                                       
                                                                                                                                
Senator Anna Fairclough joined the meeting.                                                                                     
                                                                                                                                
1:43:27 PM                                                                                                                    
                                                                                                                                
KATE   BURKHART,  EXECUTIVE   DIRECTOR,  STATEWIDE   SUICIDE                                                                    
PREVENTION  COUNCIL,  replied to  Representative  Kawasaki's                                                                    
question  first.  She  stated  that  the  audit  made  three                                                                    
recommendations.  The  first  was  that  the  council  would                                                                    
perform  an  annual  review of  its  executive  director  in                                                                    
partnership with  the Mental Health  Board and  the Advisory                                                                    
Board  on Alcoholism  and Drug  Abuse. She  added that  LB&A                                                                    
established  a  process by  which  the  annual review  would                                                                    
occur. The  council worked with its  partners to memorialize                                                                    
the framework of the council leadership.                                                                                        
                                                                                                                                
Ms. Burkhart  stated the second recommendation  to track and                                                                    
report  council  attendance  to the  governor's  office.  An                                                                    
attendance  log   was  created   for  transmission   to  the                                                                    
governor's office,  the Speaker  of the House  and President                                                                    
of the Senate. The council  did not have difficulty reaching                                                                    
a quorum due to recommendations made in the prior audit.                                                                        
                                                                                                                                
Ms.  Burkhart continued  with the  third recommendation  for                                                                    
the  council to  develop  and  monitor performance  measures                                                                    
that   supported  statutory   duties  and   annually  report                                                                    
progress.  She  noted  that   the  council  had  performance                                                                    
measures for many  years, which had not  been transmitted to                                                                    
the  missions  and measures  language  utilized  by LB&A  or                                                                    
included  in the  Department of  Health and  Social Services                                                                    
(DHSS) online performance measures.  The council was working                                                                    
with DHSS  to translate  measures from  the state  plan into                                                                    
language discernible by LB&A.                                                                                                   
                                                                                                                                
Ms. Burkhart  answered Representative Munoz's  question. She                                                                    
shared that  the funding available for  school-based suicide                                                                    
prevention  came through  the council  to the  Department of                                                                    
Education  and  Early   Development  (DEED).  The  increment                                                                    
flowed through the council to  allow the partnership between                                                                    
the council  and the  department. She  added that  the first                                                                    
year's  funding would  be provided  to Alaska's  alternative                                                                    
schools  who were  participating  in  a wellness  initiative                                                                    
funded with a grant from  the Division of Behavioral Health.                                                                    
She pointed out that  children from alternative schools were                                                                    
most likely to report  depression, suicide attempts and drug                                                                    
and  alcohol  use.  She  noted that  20  percent  of  school                                                                    
districts  applied  for  the  funding.  The  proposals  were                                                                    
reviewed and many would be  funded. She expressed confidence                                                                    
that  the  programs would  enhance  services  in the  school                                                                    
districts.                                                                                                                      
                                                                                                                                
1:47:43 PM                                                                                                                    
                                                                                                                                
Representative  Munoz   asked  if   groups  that   were  not                                                                    
affiliated  with the  school could  apply  for funding.  Ms.                                                                    
Burkhart replied  that the  school-based funding  stream was                                                                    
designed  to provide  funding  for  suicide prevention.  She                                                                    
mentioned additional  options for other  entities interested                                                                    
in   suicide   prevention   funding.  An   FY   13   capital                                                                    
appropriation  secured funding  for  small grants  up to  $5                                                                    
thousand for  community organizations. The  Alaska Community                                                                    
Foundation matched the FY 13 funding.                                                                                           
                                                                                                                                
Ms. Burkhart pointed out  the Comprehensive Prevention Grant                                                                    
Program,   which   included  opportunities   for   community                                                                    
coalitions  and   organizations  to  apply   for  prevention                                                                    
funding.                                                                                                                        
                                                                                                                                
1:50:23 PM                                                                                                                    
                                                                                                                                
Representative Gara  thanked Ms.  Burkhart for her  work. He                                                                    
stated  that much  of  the work  was  low-cost and  outreach                                                                    
related. He  pointed to work  to enhance  suicide prevention                                                                    
programs. He asked  if he should pay special  attention to a                                                                    
particular  increment  in  the operating  budget  conference                                                                    
committee.  Ms.  Burkhart  replied  that  there  was  not  a                                                                    
specific FY 14 suicide-prevention increment.                                                                                    
                                                                                                                                
Senator Fairclough  appreciated time that the  House Finance                                                                    
Committee had taken on the  issue. She spoke to high suicide                                                                    
rates  in   Alaska.  She  stated   that  the   council  made                                                                    
considerable  progress during  her membership.  She credited                                                                    
Ms. Burkhart with an excellent job.                                                                                             
                                                                                                                                
Representative Costello CLOSED public testimony.                                                                                
                                                                                                                                
Representative  Wilson  discussed   the  replacement  fiscal                                                                    
impact note from DHSS.                                                                                                          
                                                                                                                                
Representative  Wilson   MOVED  to  REPORT  SB   37  out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
SB  37  was REPORTED  out  of  committee  with a  "do  pass"                                                                    
recommendation and with one new  fiscal note from Department                                                                    
of Health and Social Services.                                                                                                  
                                                                                                                                
1:54:08 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:56:20 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 16                                                                                                            
                                                                                                                                
     "An  Act  relating to  the  Board  of Registration  for                                                                    
     Architects, Engineers,  and Land  Surveyors and  to the                                                                    
     Department   of  Commerce,   Community,  and   Economic                                                                    
     Development."                                                                                                              
                                                                                                                                
1:56:44 PM                                                                                                                    
                                                                                                                                
MARGARET DOWLING, STAFF TO  SENATOR CATHY GIESSEL, presented                                                                    
the bill. She  stated that SB 16 revised  current law, which                                                                    
allowed  the state  board  of  registration for  architects,                                                                    
engineers   and  land   surveyors   to   hire  a   full-time                                                                    
investigator. The  bill had a  provision changing  a section                                                                    
allowing  electronic   licensing  examinations.   The  board                                                                    
shared a part time investigator  with 6 other boards serving                                                                    
a total  of 18 thousand  licensees. Every board had  its own                                                                    
investigation   needs  and   the   investigator  must   have                                                                    
expertise in each subject and  familiarity with the detailed                                                                    
regulations pertinent to each board.                                                                                            
                                                                                                                                
Ms. Dowling continued that the  primary mission of the board                                                                    
was to  regulate the profession  to assure that  a specified                                                                    
level  of  competence  through  testing,  certification  and                                                                    
education. The  process protected the safety  and welfare of                                                                    
Alaska's  public. The  professional's reputations  were also                                                                    
protected   by  the   regulatory   process.  If   competency                                                                    
standards were breeched  or a question arose  about a person                                                                    
practicing  without   a  license,   the  public   and  other                                                                    
professionals were at risk.                                                                                                     
                                                                                                                                
Ms. Dowling continued  to explain that once  a complaint was                                                                    
filed, an  investigation into the validity  of the complaint                                                                    
was initiated.  When investigators were few,  the public was                                                                    
at  risk. The  board regulated  15 engineering  specialties,                                                                    
with 9 of the 15 specialties  added last year. The number of                                                                    
licensees and  claims continued to increase.  She noted that                                                                    
116 cases  were opened in the  last 15 months adding  to the                                                                    
already heavy  workload of  the part-time  investigator. The                                                                    
investigator could not possibly keep  up with the demands of                                                                    
the position.                                                                                                                   
                                                                                                                                
2:01:19 PM                                                                                                                    
                                                                                                                                
Ms.  Dowling discussed  increasing licensing  fees to  cover                                                                    
the expenses associated with the board.                                                                                         
                                                                                                                                
Representative Holmes  asked if  the issue was  supported by                                                                    
the board  members. Ms. Dowling replied  in the affirmative.                                                                    
She  explained  that  board members  brought  the  issue  to                                                                    
Senator Giessel's attention. Senator  Giessel then agreed to                                                                    
carry the bill. The potential  cost increase per license was                                                                    
minimal.                                                                                                                        
                                                                                                                                
Co-Chair Stoltze returned to the room.                                                                                          
                                                                                                                                
COLIN   MAYNARD,   MEMBER,   AELS  BOARD,   ANCHORAGE   (via                                                                    
teleconference),  spoke  in  favor of  the  legislation.  He                                                                    
stated that  the board had  two and one  half investigators,                                                                    
but  was now  down to  one seventh  of an  investigator. The                                                                    
investigator had  very little opportunity to  travel because                                                                    
of the high workload. He added  that the board of the Alaska                                                                    
Professional Design Council supported the bill.                                                                                 
                                                                                                                                
Representative Wilson discussed the  fiscal impact note from                                                                    
the   Department  of   Commerce,   Community  and   Economic                                                                    
Development.                                                                                                                    
                                                                                                                                
Representative Costello CLOSED public testimony.                                                                                
                                                                                                                                
Representative  Wilson   MOVED  to  REPORT  SB   16  out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal note.                                                                                                       
                                                                                                                                
Co-Chair Stoltze  OBJECTED. He  reviewed the bill  and found                                                                    
no   "featherbedding."   Co-Chair   Stoltze   WITHDREW   his                                                                    
objection.  There  being NO  further  OBJECTION,  it was  so                                                                    
ordered.                                                                                                                        
                                                                                                                                
SB  16   was  REPORTED   out  of   committee  with   a  "no"                                                                    
recommendation  and  with  one previously  published  fiscal                                                                    
note: FN2(CED).                                                                                                                 
                                                                                                                                
2:06:01 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:08:23 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
CS FOR SENATE BILL NO. 38(FIN)                                                                                                
                                                                                                                                
     "An  Act extending  the termination  date of  the State                                                                    
     Medical Board;  relating to the executive  secretary of                                                                    
     the  State   Medical  Board;   and  providing   for  an                                                                    
     effective date."                                                                                                           
                                                                                                                                
2:08:33 PM                                                                                                                    
                                                                                                                                
DAVID SCOTT, STAFF, SENATOR DONNY  OLSON, addressed the bill                                                                    
that extended  the sunset  date of  the state  medical board                                                                    
through  2020.  He  stated  that  LB&A  reviewed  the  board                                                                    
activities and  concluded that the  board served  the public                                                                    
interest.  The LB&A  recommended  a seven  year sunset  date                                                                    
extension.  The board  was  responsible  for the  licensing,                                                                    
regulation  and   discipline  of   physicians,  podiatrists,                                                                    
physician assistants and paramedics.  The board had two full                                                                    
time employees and the costs  were covered by licensing fees                                                                    
and all  revenue from the  board covered its  full operating                                                                    
costs. The  board unanimously  supported increasing  fees to                                                                    
cover the costs associated with the legislation.                                                                                
                                                                                                                                
2:10:57 PM                                                                                                                    
                                                                                                                                
Representative  Wilson  pointed  to the  three  deficiencies                                                                    
listed in the audit that  addressed a lack of oversight. Mr.                                                                    
Scott  stated  that  the   board  president  would  directly                                                                    
address the deficiencies noted in the audit.                                                                                    
                                                                                                                                
Representative  Wilson  noted audit  deficiencies  typically                                                                    
led to shortened extensions.                                                                                                    
                                                                                                                                
Representative Kawasaki  wondered about the  salary increase                                                                    
provided  in the  bill. He  wondered  if it  was typical  to                                                                    
include a salary  increase in a board  sunset bill. Co-Chair                                                                    
Stoltze noted that board  extensions sometimes carried major                                                                    
policy initiatives,  but the  legislature was  reforming the                                                                    
process.                                                                                                                        
                                                                                                                                
2:14:12 PM                                                                                                                    
                                                                                                                                
Representative Gara  asked the committee chair  to bring the                                                                    
medical  board   representative  before  the   committee  by                                                                    
telephone. He told a story related to law practice.                                                                             
                                                                                                                                
2:16:44 PM                                                                                                                    
                                                                                                                                
Co-Chair Austerman wondered what a  range 23 paid. Mr. Scott                                                                    
asked for a repeat of the question.                                                                                             
                                                                                                                                
Co-Chair Austerman repeated his  question. Mr. Scott offered                                                                    
to get back  to the committee with the  answer. He estimated                                                                    
that a range 23 paid $75 thousand per year.                                                                                     
                                                                                                                                
Senator Pete Kelly joined the audience.                                                                                         
                                                                                                                                
Vice-Chair Neuman joined the committee.                                                                                         
                                                                                                                                
Co-Chair  Austerman stated  that a  large disparity  existed                                                                    
between  a  doctor's charges  for  services  in Alaska  when                                                                    
compared  to those  in the  Lower  48. He  thought that  the                                                                    
fiscal note for the bill explained that disparity.                                                                              
                                                                                                                                
2:18:27 PM                                                                                                                    
                                                                                                                                
Representative  Munoz  asked  about  a  disciplinary  action                                                                    
taken  against  a  licensee. She  wondered  how  the  public                                                                    
received  information about  the action.  Mr. Scott  did not                                                                    
know.                                                                                                                           
                                                                                                                                
Representative Wilson  asked if  the sponsor would  oppose a                                                                    
shorter  sunset.  She was  not  convinced  that the  audit's                                                                    
deficiencies  had been  addressed.  Mr.  Scott replied  that                                                                    
there would not be an objection to a reasonable extension.                                                                      
                                                                                                                                
CSSB 38(FIN)  was HEARD  and HELD  in committee  for further                                                                    
consideration.                                                                                                                  
                                                                                                                                
2:20:20 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:22:00 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 88                                                                                                            
                                                                                                                                
     "An Act  authorizing the state bond  committee to issue                                                                    
     certificates   of   participation    to   finance   the                                                                    
     construction  and equipping  of residential  housing to                                                                    
     serve  the  Anchorage  campus   of  the  Alaska  Native                                                                    
     Medical  Center;  and  authorizing  the  Department  of                                                                    
     Administration   to   enter   into   a   lease-purchase                                                                    
     agreement for  the benefit of the  Alaska Native Tribal                                                                    
     Health Consortium."                                                                                                        
                                                                                                                                
2:22:22 PM                                                                                                                    
                                                                                                                                
SENATOR PETE  KELLY, SPONSOR, addressed  the bill.  He spoke                                                                    
to increased costs  in Medicaid. He pointed  to the Medicaid                                                                    
task force  who made some recommendations  and initiated the                                                                    
conversation   about   containing    Medicaid   costs.   One                                                                    
recommendation  was  to  move   people  who  were  utilizing                                                                    
Medicaid  services while  eligible  for  Tribal Health  into                                                                    
hospitals eligible for Tribal  Health grants that reimbursed                                                                    
at 100  percent. With  Medicaid, the  state paid  50 percent                                                                    
and  Medicaid paid  50 percent.  The bill  incentivized care                                                                    
for  hospitals   that  pay   100  percent.   The  department                                                                    
estimated   an   $8.8   million   saving   per   year   with                                                                    
implementation of the legislation.                                                                                              
                                                                                                                                
Co-Chair  Stoltze asked  about a  direct appropriation  or a                                                                    
bond. Senator  Kelly replied that  the net savings  would be                                                                    
$8.8  million per  year. He  furthered that  the bill  would                                                                    
bond  for  the  Alaska   Native  Medical  Center  (ANMC)  in                                                                    
Anchorage for  housing of patients  that would  then receive                                                                    
100  percent grant  funding  from  Medicaid. He  anticipated                                                                    
even greater savings with time.                                                                                                 
                                                                                                                                
2:25:41 PM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze  pointed to construction  opportunities for                                                                    
the capital side  of the issue and savings  on the operating                                                                    
side. Senator Kelly affirmed.                                                                                                   
                                                                                                                                
HEATHER SHATTUCK, STAFF, SENATOR  PETE KELLY, explained that                                                                    
the state  was responsible  for multiple pieces  when paying                                                                    
Medicaid.  The  populations  with high-risk  pregnancies  in                                                                    
rural  areas  benefitted  greatly.  She  believed  that  the                                                                    
cultural aspect  would incentivize  Alaska natives  who were                                                                    
Medicaid eligible  to utilize  the facility.  The facility's                                                                    
lease was  15 years  long and required  a memorandum  of the                                                                    
state.  The  legislation  would increase  access  to  tribal                                                                    
facilities,  which  was  in  part  contingent  on  expanding                                                                    
housing abilities.                                                                                                              
                                                                                                                                
Co-Chair Stoltze requested department testimony.                                                                                
                                                                                                                                
2:30:28 PM                                                                                                                    
                                                                                                                                
WILLIAM  STREUR,  COMMISSIONER,  DEPARTMENT  OF  HEALTH  AND                                                                    
SOCIAL SERVICES,  discussed his involvement in  the bill. He                                                                    
stated that approximately 40 percent  of state services were                                                                    
delivered within  the tribal system.  The consequence  was a                                                                    
50  percent reimbursement  for 60  percent of  services. The                                                                    
discussion  evolved  cooperatively  with Tribal  Health  who                                                                    
determined the  greatest needs  of tribal  members. Maternal                                                                    
and child health was deemed the greatest need.                                                                                  
                                                                                                                                
Commissioner  Streur  pointed  out   that  the  state  spent                                                                    
approximately  $1 million  per year  for each  of the  first                                                                    
three  years  for  a  challenged   birth.  He  mentioned  an                                                                    
immunodeficient  baby  whose  prescriptions alone  cost  $36                                                                    
thousand per month. One proposal  was to bring rural mothers                                                                    
into urban  areas for prenatal  services. He  projected $1.9                                                                    
million for increased deliveries  per year within the native                                                                    
system.  He   added  that   operating  room   expansion  was                                                                    
projected to cost $595 thousand.                                                                                                
                                                                                                                                
Commissioner Streur commented on  the abundance of ear, nose                                                                    
and throat problems occurring in  rural areas, which if left                                                                    
untreated  could lead  to permanent  damage to  children and                                                                    
their ability to be fully  productive citizens. The proposal                                                                    
was for increased medical capabilities  for those issues. He                                                                    
added  that  prenatal  outpatient  capacity  would  save  $1                                                                    
million per year  and the increased day  capacity would save                                                                    
$600  thousand per  year. The  total estimate  was for  $3.8                                                                    
million in  Medicaid savings  per year as  an offset  to the                                                                    
Tribal Health facility.                                                                                                         
                                                                                                                                
2:34:26 PM                                                                                                                    
                                                                                                                                
Commissioner Streur discussed  telemedicine capabilities. He                                                                    
noted that the telemedicine  program at Alaska Native Tribal                                                                    
Health  Consortium (ANTHC)  provided  a  national model.  He                                                                    
believed that the performance measures  would be included in                                                                    
the memorandum of agreement.                                                                                                    
                                                                                                                                
2:35:45 PM                                                                                                                    
                                                                                                                                
Vice-Chair Neuman asked if the  facility would be located in                                                                    
Anchorage.  Commissioner Streur  replied  yes, the  facility                                                                    
would be  located on the  ANTHC campus and connected  by sky                                                                    
bridge to the Native Medical Center.                                                                                            
                                                                                                                                
Vice-Chair Neuman  noted that 60  percent of  Alaska natives                                                                    
did  not attend  visits with  a primary  care provider,  but                                                                    
instead chose  emergency services.  He asked how  the Alaska                                                                    
natives  could  be convinced  to  choose  the facility  over                                                                    
emergency  hospital care.  He  wondered  how the  percentage                                                                    
could be lowered.                                                                                                               
                                                                                                                                
2:37:32 PM                                                                                                                    
                                                                                                                                
Commissioner  Streur  responded  that most  native  citizens                                                                    
would arrive at  the facility from Anchorage.  He noted that                                                                    
people coming  into Anchorage  may or  may not  end up  at a                                                                    
tribal  facility. The  intent of  the legislation  was early                                                                    
outreach  and  additional  services. The  prenatal  services                                                                    
would  bring  young  mothers  into  the  facility  for  care                                                                    
earlier  in their  pregnancies. The  prenatal service  would                                                                    
encourage deliveries within the Tribal Health system.                                                                           
                                                                                                                                
2:39:25 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Neuman asked  about an  opportunity for  veteran                                                                    
services. Commissioner  Streur responded  that an  effort to                                                                    
increase  veteran  care  was  active  in  Bethel,  Nome  and                                                                    
Barrow.  He mentioned  outreach  in other  rural areas.  The                                                                    
outreach led to  over 100 veterans in the  Cordova area. Co-                                                                    
Chair Stoltze clarified the city of Cordova.                                                                                    
                                                                                                                                
Vice-Chair Neuman hoped to get  additional help for veterans                                                                    
in his area.                                                                                                                    
                                                                                                                                
2:41:11 PM                                                                                                                    
                                                                                                                                
Vice-Chair Neuman  asked if there  was a  Neonatal Intensive                                                                    
Care Unit (NICU) in the facility.                                                                                               
                                                                                                                                
Commissioner  Streur replied  that the  facility did  have a                                                                    
NICU  with  eight  beds  as part  of  the  Alaska  pediatric                                                                    
partnership.  When the  eight beds  were full,  transfers to                                                                    
Providence  were made.  Co-Chair  Stoltze  assumed that  the                                                                    
prenatal care minimized the need  for the NICU. Commissioner                                                                    
Streur agreed.                                                                                                                  
                                                                                                                                
Representative  Kawasaki  pointed  to  a  centrally  located                                                                    
hospital  in Fairbanks.  He  understood  that the  Fairbanks                                                                    
Native Association had a facility  to house people receiving                                                                    
care at  the new facility.  He wondered if the  same bonding                                                                    
mechanism  could be  used for  other  facilities across  the                                                                    
state.                                                                                                                          
                                                                                                                                
2:43:23 PM                                                                                                                    
                                                                                                                                
Commissioner  Streur  replied  that the  efforts  to  expand                                                                    
Medicaid type  services had  been proposed  in a  variety of                                                                    
mechanisms   since   2006.   He  advocated   for   continued                                                                    
development of the services.                                                                                                    
                                                                                                                                
Co-Chair Stoltze  mentioned the Mat-Su Valley  Tribal Health                                                                    
facility.  He wondered  if benefits  from that  new facility                                                                    
were  observed.  Commissioner   Streur  responded  that  the                                                                    
facility  was not  yet  open. He  believed  that the  dental                                                                    
clinic was the only open portion.                                                                                               
                                                                                                                                
Co-Chair Stoltze believed  that the Mat-Su valley  had 10 or                                                                    
11 percent Alaska native population.                                                                                            
                                                                                                                                
2:46:07 PM                                                                                                                    
                                                                                                                                
ANGELA  RODELL,  DEPUTY   COMMISSIONER,  TREASURY  DIVISION,                                                                    
DEPARTMENT  OF REVENUE,  addressed SB  88, which  authorized                                                                    
the issuance of certificates  of participation in the amount                                                                    
of $35  million. The  funding would be  used to  finance the                                                                    
construction  of a  179 bed  facility at  the Alaska  Native                                                                    
Medical  Center   to  serve   patients  and   families.  The                                                                    
certificates of participation would  be used to finance five                                                                    
of the six  floors in the facility with  ANTHC financing the                                                                    
sixth floor. The  costs were capped at $35  million with any                                                                    
cost overruns born  by ANTHC. The ultimate  project goal was                                                                    
to realize  annual general fund  savings. The total  cost to                                                                    
the  state  was estimated  at  $42  million, which  included                                                                    
principal  and interest  to repay  the  certificates over  a                                                                    
period  of 15  years. The  payments were  subject to  annual                                                                    
appropriation.  The  annually  required  debt  service  cost                                                                    
approximately $3  million per year. An  assumption was built                                                                    
in  for  increased  rates.  She  noted  that  Department  of                                                                    
Administration  (DOA) would  enter  into  a lease  agreement                                                                    
with  ANTHC who  would  be responsible  for  the design  and                                                                    
building  of the  facility. Construction  invoices would  be                                                                    
submitted  to   the  department   with  the   assistance  of                                                                    
Department of  Health and Social Services  (DHSS). The state                                                                    
would  maintain the  tax exemption  on  the certificates  of                                                                    
participation.                                                                                                                  
                                                                                                                                
Representative   Wilson  asked   if  the   money  would   be                                                                    
reimbursed to the  state. Ms. Rodell replied  that the state                                                                    
would fund the facility.  Medicaid savings would provide the                                                                    
funding. The facility was a crucial aspect of the savings.                                                                      
                                                                                                                                
Representative Holmes  pointed to  page 2, lines  24 through                                                                    
27. She stated  that the bill did  not mention participation                                                                    
by ANTHC. Ms. Rodell clarified  that the bill was related to                                                                    
the $35 million only. The  entire project cost exceeded that                                                                    
amount.  The  partnership  agreement was  that  ANTHC  would                                                                    
contribute to the construction of the total project.                                                                            
                                                                                                                                
Representative Holmes noted that  subsection (a) referred to                                                                    
the  project  as a  residential  housing  facility with  all                                                                    
remaining funding connected to  the investment income earned                                                                    
on  the   proceeds.  She  believed  the   language  did  not                                                                    
adequately detail the private partner's participation.                                                                          
                                                                                                                                
2:52:22 PM                                                                                                                    
                                                                                                                                
Ms. Rodell answered that she  was unsure about acknowledging                                                                    
the  private  partner's  participation  in  the  legislation                                                                    
because ANTHC  would be contributing  equity. Representative                                                                    
Holmes  was  supportive  of  the  project  and  would  speak                                                                    
further with Ms. Rodell about the issue.                                                                                        
                                                                                                                                
Co-Chair Austerman asked if the  Department of Revenue (DOR)                                                                    
would sell the bond. Ms. Rodell replied in the affirmative.                                                                     
                                                                                                                                
Co-Chair  Austerman  asked  about the  federal  government's                                                                    
participation in the project.  Ms. Rodell answered that once                                                                    
the  state went  forward  with the  project, the  department                                                                    
would come  to the  legislature for  an annual  debt service                                                                    
request  regardless  of   federal  government  participation                                                                    
regarding Medicaid.                                                                                                             
                                                                                                                                
Co-Chair Austerman  asked for verification that  the project                                                                    
was dependent on the federal  government. Ms. Rodell replied                                                                    
in the affirmative.                                                                                                             
                                                                                                                                
Representative  Munoz  asked  if   the  state  would  derive                                                                    
benefit  once  the  facility  had  been  paid  off  and  was                                                                    
constructed.  Ms.  Rodell  replied   that  the  state  would                                                                    
continue to derive benefit due to the savings.                                                                                  
                                                                                                                                
Representative  Munoz clarified  that the  state shared  the                                                                    
cost of  Medicaid with the federal  government. She wondered                                                                    
if  the state  would derive  the financial  benefit for  the                                                                    
savings allowed by  the presence of the  facility. She asked                                                                    
if the  state's contribution  to Medicaid would  lessen. Ms.                                                                    
Rodell deferred the question to Commissioner Streur.                                                                            
                                                                                                                                
Co-Chair Stoltze noted that the  legislation would allow for                                                                    
medical  services  for  additional Alaskans  and  provide  a                                                                    
permanent accrual of benefit.                                                                                                   
                                                                                                                                
2:57:16 PM                                                                                                                    
                                                                                                                                
Co-Chair Austerman  pointed to the fiscal  note listing $2.8                                                                    
million per year paid by the state. Ms. Rodell concurred.                                                                       
                                                                                                                                
Representative Wilson  asked what would happen  if the state                                                                    
did  not fund  the  $3 million  annual  payment. Ms.  Rodell                                                                    
replied that the state would be in default.                                                                                     
                                                                                                                                
Representative Wilson asked if  the state was competing with                                                                    
the private sector. Ms. Rodell deferred the question.                                                                           
                                                                                                                                
2:58:41 PM                                                                                                                    
                                                                                                                                
VALERIE    DAVIDSON,    SENIOR     DIRECTOR,    LEGAL    AND                                                                    
INTERGOVERNMENTAL  AFFAIRS,  ALASKA   NATIVE  TRIBAL  HEALTH                                                                    
CONSORTIUM  (ANTHC), spoke  in support  of the  legislation.                                                                    
She  stated that  expanding patient  housing would  allow an                                                                    
expansion  of services  at ANTHC.  She provided  examples of                                                                    
patients  that would  benefit from  the facility.  The first                                                                    
story pertained  to a  pregnant woman  from a  small village                                                                    
who  experienced  complications  and   needed  to  be  in  a                                                                    
hospital  but  was  unfamiliar  with  the  use  of  Medicaid                                                                    
vouchers.  She mentioned  her own  personal experience.  She                                                                    
elaborated on  the story.  She stated  that patients  had to                                                                    
learn  navigation of  a whole  new world  in Anchorage  when                                                                    
they were  from a village.  She provided information  on the                                                                    
proposed  facility. She  explained  how a  patient would  be                                                                    
treated  in the  new  facility. She  discussed the  services                                                                    
provided  at the  facility including  the cafeteria,  shared                                                                    
kitchen and housing.                                                                                                            
                                                                                                                                
3:04:33 PM                                                                                                                    
                                                                                                                                
Ms.  Davidson continued  to discuss  how the  facility would                                                                    
help various patients of all  ages. She furthered that ANTHC                                                                    
was  the  highest level  trauma  center  in the  state.  The                                                                    
project allowed  the state to  realize an annual  savings of                                                                    
$8.8  million. The  state's required  contribution would  be                                                                    
$2.8 to  $2.9 million annually.  She spoke to  the necessary                                                                    
housing component. She thanked the committee for its time.                                                                      
                                                                                                                                
Representative Holmes  asked if  the facility  would enhance                                                                    
the   ability  for   telemedicine  services.   Ms.  Davidson                                                                    
answered that  ANTHC had a program  for telemedicine service                                                                    
which allowed savings in ear,  nose and throat services. Her                                                                    
organization had  documented the  travel savings  because of                                                                    
the telemedicine services. She  stated that the organization                                                                    
explored expansion of telecardiology services.                                                                                  
                                                                                                                                
Representative Holmes discussed support  for the benefits of                                                                    
telemedicine services.                                                                                                          
                                                                                                                                
Co-Chair  Stoltze asked  ANTHC was  under the  management of                                                                    
the  Southcentral umbrella.  Ms. Davidson  replied that  the                                                                    
Southcentral foundation  and ANTHC joint-managed  the Alaska                                                                    
Native Medical center.                                                                                                          
                                                                                                                                
Co-Chair  Stoltze   remarked  about  the   partnership.  Ms.                                                                    
Davidson commented on the many benefits of the partnership.                                                                     
                                                                                                                                
Co-Chair Stoltze  asked about the facility  in Wasilla known                                                                    
as Benteh Nuutah. He wondered about its progress.                                                                               
                                                                                                                                
Ms. Davidson replied  that once a facility was  able to bill                                                                    
services that  were available by  a tribal  health facility,                                                                    
the state immediately saw savings.                                                                                              
                                                                                                                                
3:10:57 PM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze  hoped that there  was a  decreasing number                                                                    
of  Alaskans  that  would  require  Medicaid  because  of  a                                                                    
thriving economy.                                                                                                               
                                                                                                                                
Representative  Edgmon  asked  about the  safety  aspect  of                                                                    
bringing  patients in  from villages.  Ms. Davidson  replied                                                                    
that  the consortium  had heard  stories about  people being                                                                    
taken advantage  of in cab  rides to the ANMC.  She provided                                                                    
other  stories  about patients  who  did  not speak  English                                                                    
well. The housing  facility goal was to provide  a home away                                                                    
from  home.  She shared  a  personal  story related  to  her                                                                    
childhood. She furthered that  Alaska Native families wanted                                                                    
what all  families wanted. She  stated that when  there were                                                                    
opportunities  to  help the  lives  of  many people  it  was                                                                    
important to seize them.                                                                                                        
                                                                                                                                
Co-Chair Stoltze inferred that  the bill financed a facility                                                                    
with  great   opportunities  for  savings,   which  included                                                                    
facilitated transportation for  rural patients. Ms. Davidson                                                                    
replied  in the  affirmative.  The  transportation from  the                                                                    
housing to the airport would be provided.                                                                                       
                                                                                                                                
3:16:40 PM                                                                                                                    
                                                                                                                                
Representative Wilson  asked if  Medicaid eligibility  was a                                                                    
patient requirement.  Ms. Davidson replied that  the housing                                                                    
facility  would be  available to  all eligible  individuals.                                                                    
Co-Chair Stoltze expounded  that Medicaid patients utilizing                                                                    
the  facility  would  benefit state  savings.  Ms.  Davidson                                                                    
concurred.                                                                                                                      
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony.                                                                                       
                                                                                                                                
SB  88  was   HEARD  and  HELD  in   committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
3:19:14 PM                                                                                                                    
RECESSED                                                                                                                        
                                                                                                                                
7:36:27 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
CS FOR SENATE BILL NO. 38(FIN)                                                                                                
                                                                                                                                
     "An  Act extending  the termination  date of  the State                                                                    
     Medical Board;  relating to the executive  secretary of                                                                    
     the  State   Medical  Board;   and  providing   for  an                                                                    
     effective date."                                                                                                           
                                                                                                                                
7:36:27 PM                                                                                                                    
                                                                                                                                
DON  HABEGAR, DIRECTOR,  DIVISION OF  CORPORATIONS, BUSINESS                                                                    
AND   PROFESSIONAL   LICENSING,  DEPARTMENT   OF   COMMERCE,                                                                    
COMMUNITY  AND ECONOMIC  DEVELOPMENT stated  that he  had an                                                                    
opportunity to  listen to the  committee's prior  hearing on                                                                    
the legislation.                                                                                                                
                                                                                                                                
DAVE  SCOTT, STAFF,  SENATOR OLSON,  answered Representative                                                                    
Munoz's earlier  question about the board's  presentation of                                                                    
findings  to the  public. He  noted that  the administrative                                                                    
procedure act was  applicable to the board  allowing for the                                                                    
Open  Meeting  Act. He  added  that  "the board  shall  make                                                                    
available  to the  public the  information maintained  under                                                                    
(a) and  (b) of the  section for each person  licensed under                                                                    
this chapter" as stated in AS 08.64.130.                                                                                        
                                                                                                                                
Mr.  Scott  responded  to Representative  Wilson's  question                                                                    
about the  board's recommendations regarding the  audit from                                                                    
LB&A.                                                                                                                           
                                                                                                                                
Co-Chair Stoltze directed the question to Mr. Habegar.                                                                          
                                                                                                                                
Mr. Habegar  stated that the  audit's first  point addressed                                                                    
the database issues. He noted  that ample work was done this                                                                    
month to continue with the  maintenance agreement. He stated                                                                    
that testing  the changes  in the  database and  the records                                                                    
would prove the work done.                                                                                                      
                                                                                                                                
7:40:21 PM                                                                                                                    
                                                                                                                                
Mr. Habegar stated that the  second piece of the audit dealt                                                                    
with  continuing  education.  The department  implemented  a                                                                    
professional licensing  database system.  He added  that the                                                                    
recommendation also  required procedures mandating  that the                                                                    
board report to  the federation of state  database to ensure                                                                    
that a  check-and-balance system was established.  The board                                                                    
ensured that their executive  administrator was liaison with                                                                    
the chief medical investigator to ensure timeliness.                                                                            
                                                                                                                                
7:41:47 PM                                                                                                                    
                                                                                                                                
Representative Wilson noted that  the computer system change                                                                    
led to the  issues. She wondered if the  improvements in the                                                                    
database gave the director the  confidence to approve of the                                                                    
extension. Mr. Habegar admitted that  he was hopeful and had                                                                    
many IT specialists working on the issue.                                                                                       
                                                                                                                                
Co-Chair  Stoltze noted  fewer and  fewer problems  with the                                                                    
new director of boards and commissions.                                                                                         
                                                                                                                                
7:42:54 PM                                                                                                                    
                                                                                                                                
Representative  Kawasaki  asked  about the  salary  schedule                                                                    
changes and  the other boards  and commissions.  He wondered                                                                    
if  the department  would provide  staff for  the board.  He                                                                    
asked  if other  boards had  the latitude  to select  salary                                                                    
ranges for executive directors and staff.                                                                                       
                                                                                                                                
Mr.  Habegar replied  that salaried  positions  were set  by                                                                    
DOA;  however the  Certified Public  Accountant (CPA)  board                                                                    
did address  the issue  by placing a  range in  statute. The                                                                    
salary raise  was not allowed outside  of the administration                                                                    
process and he believed that  the board was taking advantage                                                                    
of the CPA model.                                                                                                               
                                                                                                                                
7:44:18 PM                                                                                                                    
                                                                                                                                
Representative Gara asked about  the small medical community                                                                    
and the  difficulty with doctors realizing  that another had                                                                    
breached  duties.  He  wondered   about  an  outside  doctor                                                                    
brought in to  do an evaluation. Mr.  Habegar responded that                                                                    
occasionally an  outside doctor comes  in and in  a standard                                                                    
of care issue; staff had  certain liaisons that would advise                                                                    
staff. If  the case investigation did  require experts, they                                                                    
were hired outside of the state.                                                                                                
                                                                                                                                
7:46:51 PM                                                                                                                    
                                                                                                                                
Representative Gara encouraged the practice.                                                                                    
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony.                                                                                       
                                                                                                                                
Co-Chair  Stoltze asked  about  objections  to changing  the                                                                    
sunset date. Representative Wilson stated no.                                                                                   
                                                                                                                                
7:48:21 PM                                                                                                                    
                                                                                                                                
Representative  Costello  discussed  the fiscal  note  which                                                                    
indicated  fiscal  impact  of  $484.6  thousand  for  FY  14                                                                    
through FY 19 and two full time positions.                                                                                      
                                                                                                                                
Co-Chair Stoltze  asked if the  benefits would  be increased                                                                    
to $110 thousand.                                                                                                               
                                                                                                                                
Representative Costello  MOVED to  REPORT CSSB 38  (FIN) out                                                                    
of  committee   with  individual  recommendations   and  the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSSB  38 (FIN)  was REPORTED  out of  committee with  a "no"                                                                    
recommendation  and  with  one previously  published  fiscal                                                                    
impact note: FN1(CED).                                                                                                          
                                                                                                                                
SENATE BILL NO. 24                                                                                                            
                                                                                                                                
     "An Act relating to the Alaska Marine Transportation                                                                       
     Advisory Board."                                                                                                           
                                                                                                                                
7:51:03 PM                                                                                                                    
                                                                                                                                
DOUG  LETCH, STAFF,  SENATOR GARY  STEVENS, stated  that the                                                                    
bill   was  smaller   and  proposed   changing  the   Marine                                                                    
Transportation  Advisory Board  and  adding  a twelfth  seat                                                                    
from Southcentral  Alaska. The  legislation would  allow the                                                                    
twelfth  seat   enabling  membership  to   participate  from                                                                    
communities  served  on  Kodiak Island,  the  Kachemak  Bay,                                                                    
Seldovia  and   Homer.  He   noted  an   additional  section                                                                    
reflecting Gustavus' consideration  for community membership                                                                    
in  the Southeast  section.  He mentioned  a  change in  the                                                                    
House   Transportation   Committee   at   the   request   of                                                                    
Representative  Wilson on  page 2  line 10  remove the  word                                                                    
"retired"  and  add "20  years  of  experience." The  change                                                                    
would increase the applicant pool  for that particular seat.                                                                    
He  spoke about  the  Marine  Transportation Advisory  Board                                                                    
(MTAP).  He  pointed  out  written  testimony  in  committee                                                                    
members'  packets   from  Homer  and  Seldovia   Chamber  of                                                                    
Commerce.                                                                                                                       
                                                                                                                                
7:54:57 PM                                                                                                                    
                                                                                                                                
Representative Holmes  asked if the  board had a  history of                                                                    
deadlock votes. Mr. Letch replied  that there had never been                                                                    
a tie vote and the board  did not have bylaws. The board was                                                                    
amicable  and  wanted to  bring  better  ferry laws  to  the                                                                    
state.                                                                                                                          
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony.                                                                                       
                                                                                                                                
Representative Costello discussed the  fiscal note showing a                                                                    
fiscal impact of $3 thousand for FY 14 through FY 19.                                                                           
                                                                                                                                
Representative  Wilson asked  how often  the board  met. Mr.                                                                    
Letch  replied that  the board  was required  to attend  one                                                                    
meeting per year,  so the money would cover the  cost of the                                                                    
short meeting.                                                                                                                  
                                                                                                                                
7:58:01 PM                                                                                                                    
                                                                                                                                
Representative   Edgmon  announced   that   Mr.  Letch   was                                                                    
retiring. Mr.  Letch replied that  he would move  to Orlando                                                                    
Florida after the legislative session.                                                                                          
                                                                                                                                
Co-Chair Stoltze  commented that Mr. Letch  was a thoughtful                                                                    
and wonderful employee. He was an asset to the building.                                                                        
                                                                                                                                
Representative  Costello  MOVED  to  REPORT  SB  24  out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
SB  24  was REPORTED  out  of  committee  with a  "do  pass"                                                                    
recommendation and with one new  fiscal note from Department                                                                    
of Transportation and Public Facilities.                                                                                        
                                                                                                                                
8:00:28 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
8:01:15 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
SENATE BILL NO. 2                                                                                                             
                                                                                                                                
     "An  Act enacting  the  Interstate  Mining Compact  and                                                                    
     relating  to the  compact; relating  to the  Interstate                                                                    
     Mining  Commission;  and  providing  for  an  effective                                                                    
     date."                                                                                                                     
                                                                                                                                
8:01:15 PM                                                                                                                    
                                                                                                                                
SENATOR  CATHY  GIESSEL  introduced  her  bill  which  would                                                                    
elevate Alaska  from an associate member  to full membership                                                                    
in the Interstate Mining Compact  and Commission (IMCC). The                                                                    
change  would allow  Alaska's governor  be an  active voting                                                                    
member  giving Alaska  a voice  on the  national level.  The                                                                    
compact was  established in April  1971 and consisted  of 20                                                                    
member states  and five associate member  states. The powers                                                                    
of the commission  were found on page four of  the bill. The                                                                    
estimated  cost included  $40 thousand  in  dues, which  was                                                                    
partially  based on  resource  production.  She mentioned  a                                                                    
chart  in  the  bill  materials that  illustrated  the  dues                                                                    
calculation.                                                                                                                    
                                                                                                                                
8:05:01 PM                                                                                                                    
                                                                                                                                
ED  FOGELS,  DEPUTY   COMMISSIONER,  DEPARTMENT  OF  NATURAL                                                                    
RESOURCES, testified on the bill.  He stated that Alaska now                                                                    
had seven operating mines that  did well environmentally. He                                                                    
noted  that the  permitting  and  regulatory processes  were                                                                    
improving.  The  bill's  initiative was  to  strengthen  the                                                                    
collaborative   relationship  with   the  federal   agencies                                                                    
because  permitting  relied  heavily on  federal  rules  and                                                                    
regulations.  He  stated  that  IMCC  brought  together  the                                                                    
environmental  and mining  programs  from 26  states in  the                                                                    
nation.  In this  forum,  the  states exchanged  information                                                                    
about potential areas of improvement.                                                                                           
                                                                                                                                
Mr. Fogels  explained that IMCC was  instrumental in helping                                                                    
Alaska  with the  number of  initiatives  where the  federal                                                                    
government was  "over-reaching." He provided an  example. He                                                                    
was the  governor's designee  for IMCC and  he had  seen the                                                                    
benefits of the collaboration first hand.                                                                                       
                                                                                                                                
8:07:46 PM                                                                                                                    
                                                                                                                                
Representative Holmes asked  about page 4 and  the powers of                                                                    
the  commission. She  noted that  the commission  might make                                                                    
recommendations,  which could  be broadly  read. Mr.  Fogels                                                                    
replied  that  frequent  IMCC actions  included  resolutions                                                                    
directed at federal agencies.                                                                                                   
                                                                                                                                
Representative  Costello appreciated  the bill  and she  was                                                                    
disappointed that the  previous version of the  bill did not                                                                    
elevate Alaska to  full membership. She asked  if there were                                                                    
tangible benefits to full members.                                                                                              
                                                                                                                                
8:09:08 PM                                                                                                                    
                                                                                                                                
Mr.  Fogels replied  that the  most significant  benefit was                                                                    
the ability for Alaska to  take a leadership role and better                                                                    
guide  the policy  chosen by  the commission.  Initially the                                                                    
commission was an east-coast coal-centric organization.                                                                         
                                                                                                                                
8:10:10 PM                                                                                                                    
                                                                                                                                
Representative Costello asked  about the committee structure                                                                    
of the  meetings. She asked  about his participation  in the                                                                    
meetings.  Mr. Fogels  replied  that  the commission  hosted                                                                    
multiple  committees and  he had  participated in  meetings,                                                                    
but was not allowed to vote as an associate member.                                                                             
                                                                                                                                
Vice-Chair  Neuman  asked  if IMCC  had  addressed  Alaska's                                                                    
mining  permits. He  asked how  the commission  was able  to                                                                    
help miners.  Mr. Fogels replied that  IMCC recently entered                                                                    
into  a memorandum  of understanding  with  the Mine  Safety                                                                    
Health  Administration.  He  commented  that  smaller  rural                                                                    
mines were unable to abide  by the strict federal guidelines                                                                    
set forth by  the Mine Safety Health  Administration. He was                                                                    
able to bring the concerns  of the smaller Alaskan miners to                                                                    
the attention of IMCC.                                                                                                          
                                                                                                                                
8:12:41 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Neuman  reviewed  the  travel costs  on  page  1                                                                    
showing $20 thousand for two  trips. Mr. Fogels replied that                                                                    
he traveled frugally. He explained  that there were two IMCC                                                                    
meetings per year and the  department sent two people to the                                                                    
meetings.  Additional meetings  were organized  depending on                                                                    
the issues. He stated  that mining symposiums for regulators                                                                    
were also hosted in western  states. He hoped to incorporate                                                                    
staff  from Department  of Environmental  Conservation (DEC)                                                                    
and Department of Fish and Game (DF&G).                                                                                         
                                                                                                                                
8:14:55 PM                                                                                                                    
                                                                                                                                
Representative   Munoz  asked   about  the   404  permitting                                                                    
legislation and how the IMCC  could help. Mr. Fogels replied                                                                    
that  the quest  for  Alaska  state primacy  was  part of  a                                                                    
broader  effort  to  acquire   more  control  over  wetlands                                                                    
permitting  in  Alaska. Each  piece  of  the issue  involved                                                                    
negotiation  with the  federal government.  He noticed  that                                                                    
every mining  state in  the nation  who participated  in the                                                                    
meetings  signaled a  higher level  of anxiety  with federal                                                                    
overreach.                                                                                                                      
                                                                                                                                
8:17:12 PM                                                                                                                    
                                                                                                                                
Senator Giessel added that the  IMCC participated with other                                                                    
western  states  on  issues  related  to  mining  royalties.                                                                    
Alaska did not participate  in much mineral resource royalty                                                                    
sharing.                                                                                                                        
                                                                                                                                
8:18:12 PM                                                                                                                    
                                                                                                                                
Mr. Fogels  added that the  federal government held  back on                                                                    
royalties.  The  IMCC  effort would  also  aid  the  broader                                                                    
resource development spectrum in Alaska.                                                                                        
                                                                                                                                
8:18:48 PM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony.                                                                                       
                                                                                                                                
Representative  Costello  discussed  the fiscal  notes.  She                                                                    
began with  fiscal note 1,  which showed a fiscal  impact of                                                                    
$60 thousand  for FY 14 through  FY 19, while fiscal  note 2                                                                    
was a zero note.                                                                                                                
                                                                                                                                
Representative Wilson asked about  the second page of fiscal                                                                    
note 1. She  stated that the fiscal note  stated that Alaska                                                                    
would  be the  20th  state to  join the  compact  as a  full                                                                    
member.  She  understood that  Alaska  would  be the  second                                                                    
state  to join  as a  full member.  Mr. Fogels  replied that                                                                    
Utah was  the only western state  that had joined as  a full                                                                    
member.                                                                                                                         
                                                                                                                                
8:21:40 PM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze had an issue  with travel for DNR. He asked                                                                    
Representative  Costello if  she  was  comfortable with  the                                                                    
fiscal note.                                                                                                                    
                                                                                                                                
Representative Costello  wondered about reducing  the travel                                                                    
component  by  half. Mr.  Fogels  replied  that the  meeting                                                                    
opportunities would be fewer.  He stated that the symposiums                                                                    
would not be attended.                                                                                                          
                                                                                                                                
Representative  Costello repeated  the  question to  Senator                                                                    
Giessel. Senator  Giessel stated  that the  attendance would                                                                    
be  reduced for  Alaska  as  a result.  She  hoped that  the                                                                    
department would  find other  means. She  preferred face-to-                                                                    
face attendance to teleconference.                                                                                              
                                                                                                                                
Co-Chair   Stoltze  stated   that   associated  travel   was                                                                    
introduced.                                                                                                                     
                                                                                                                                
8:24:18 PM                                                                                                                    
                                                                                                                                
Co-Chair  Stoltze MOVED  that the  travel portion  of fiscal                                                                    
note 1 was reduced  to $15 thousand. Representative Costello                                                                    
OBJECTED for discussion.                                                                                                        
                                                                                                                                
Representative  Costello understood  that travel  costs were                                                                    
great,  but she  had faith  that the  department would  seek                                                                    
efficiencies.    Representative   Costello    WITHDREW   her                                                                    
OBJECTION.                                                                                                                      
                                                                                                                                
Co-Chair  Stoltze  AMENDED the  fiscal  note  to show  a  $5                                                                    
thousand reduction.                                                                                                             
                                                                                                                                
Co-Chair  Stoltze  asked  if the  dues  were  structured  on                                                                    
production or state revenues.                                                                                                   
                                                                                                                                
8:25:53 PM                                                                                                                    
                                                                                                                                
Mr.  Fogels  replied  that  the  IMCC  structured  the  dues                                                                    
calculation by developing a two-year  budget, which was then                                                                    
projected out and divided in  half. Half of the final number                                                                    
was  prorated and  divided evenly  among member  states. The                                                                    
other half was made up as a percentage of production.                                                                           
                                                                                                                                
Co-Chair  Stoltze understood  that there  was a  cap to  the                                                                    
dues.                                                                                                                           
                                                                                                                                
8:27:12 PM                                                                                                                    
                                                                                                                                
Senator  Giessel commented  that  when new  stated join  the                                                                    
compact as full members, the price of dues decreases.                                                                           
                                                                                                                                
Representative Costello MOVED to REPORT  SB 2 as amended out                                                                    
of  committee   with  individual  recommendations   and  the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
SB  2  was  REPORTED  out  of committee  with  a  "do  pass"                                                                    
recommendation  and with  one new  amended fiscal  note from                                                                    
Department   of  Natural   Resources   and  one   previously                                                                    
published zero fiscal note: FN 2(ADM).                                                                                          
                                                                                                                                
8:29:25 PM                                                                                                                    
                                                                                                                                
Representative Gara  asked about  Department of  Revenue and                                                                    
the offer to answer questions  regarding the modeling of HCS                                                                    
CSSB 21(RES). Co-Chair Stoltze concurred.                                                                                       
                                                                                                                                
8:31:03 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 8:31 p.m.                                                                                          
                                                                                                                                
                                                                                                                                

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