Legislature(2017 - 2018)HOUSE FINANCE 519

02/27/2017 01:00 PM FINANCE

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01:02:48 PM Start
01:03:59 PM HB57 || HB59
07:00:05 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Please Note Time Change --
+= HB 57 APPROP: OPERATING BUDGET/LOANS/FUNDS TELECONFERENCED
Heard & Held
+= HB 59 APPROP: MENTAL HEALTH BUDGET TELECONFERENCED
Heard & Held
+ Subcommittee Reports & Amendments: TELECONFERENCED
- Dept. of Corrections
- Dept. of Fish & Game
- Dept. of Health & Social Services
- Judiciary
- Dept. of Law
- Legislature
- Dept. of Public Safety
- Dept. of Transportation & Public Facilities
- University of AK
+ Bills Previously Heard/Scheduled TELECONFERENCED
                  HOUSE FINANCE COMMITTEE                                                                                       
                     February 27, 2017                                                                                          
                         1:02 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
1:02:48 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Seaton  called the House Finance  Committee meeting                                                                    
to order at 1:02 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Neal Foster, Co-Chair                                                                                            
Representative Paul Seaton, Co-Chair                                                                                            
Representative Les Gara, Vice-Chair                                                                                             
Representative Jason Grenn                                                                                                      
Representative David Guttenberg                                                                                                 
Representative Scott Kawasaki                                                                                                   
Representative Dan Ortiz                                                                                                        
Representative Lance Pruitt                                                                                                     
Representative Steve Thompson                                                                                                   
Representative Cathy Tilton                                                                                                     
Representative Tammie Wilson                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Amanda  Ryder,  Analyst,  Division of  Legislative  Finance;                                                                    
Carol    Petraborg,   Administrative    Services   Director,                                                                    
Department  of   Fish  and   Game;  Karen   Forrest,  Deputy                                                                    
Commissioner,  Department  of  Health and  Social  Services;                                                                    
Shawnda  O'Brien,  Assistant   Commissioner,  Department  of                                                                    
Health and  Social Services; Brandon  Cullum, Administrative                                                                    
Services  Director, Department  of Law;  Jim Cantor,  Deputy                                                                    
Attorney General,  Department of Law; Amanda  Holland, Admin                                                                    
Services  Director,  Department   of  Transportation;  Miles                                                                    
Baker, University of Alaska; Representative Louise Stutes.                                                                      
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Jessica Bogard, Administrative  Operations Manager, Division                                                                    
of Public Assistance                                                                                                            
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 57     APPROP: OPERATING BUDGET/LOANS/FUNDS                                                                                  
                                                                                                                                
          HB 57 was heard and HELD in Committee for further                                                                     
          consideration.                                                                                                        
                                                                                                                                
HB 59     APPROP: MENTAL HEALTH BUDGET                                                                                          
                                                                                                                                
          HB 59 was HEARD and HELD in committee for further                                                                     
          consideration.                                                                                                        
                                                                                                                                
Co-Chair Seaton reviewed the agenda for the day. The                                                                            
committee would be hearing subcommittee reports for the                                                                         
following departments:                                                                                                          
                                                                                                                                
     Department of Corrections (DOC)                                                                                            
     Department of Fish and Game (DFG)                                                                                          
     Department of Health and Social Services (DHSS)                                                                            
     Department of Law (DOL)                                                                                                    
     Department of Public Safety (DPS)                                                                                          
     Department  of  Transportation  and  Public  Facilities                                                                    
     (DOT)                                                                                                                      
     University of Alaska (UA)                                                                                                  
     Judiciary (JUD)                                                                                                            
     Legislature (LEG)                                                                                                          
                                                                                                                                
Co-Chair Seaton indicated that the  committee would bring up                                                                    
other departments if time  allowed. The subcommittee reports                                                                    
were  distributed   to  members  the  previous   Friday  and                                                                    
Saturday  and were  posted online.  He asked  Representative                                                                    
Kawasaki to begin with the report for DOC.                                                                                      
                                                                                                                                
HOUSE BILL NO. 57                                                                                                             
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     loan  program  expenses  of state  government  and  for                                                                    
     certain   programs;    capitalizing   funds;   amending                                                                    
     appropriations;   repealing    appropriations;   making                                                                    
     supplemental  appropriations and  reappropriations, and                                                                    
     making  appropriations  under   art.  IX,  sec.  17(c),                                                                    
     Constitution  of   the  State   of  Alaska,   from  the                                                                    
     constitutional budget  reserve fund; and  providing for                                                                    
     an effective date."                                                                                                        
                                                                                                                                
HOUSE BILL NO. 59                                                                                                             
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     capital    expenses   of    the   state's    integrated                                                                    
     comprehensive mental health  program; and providing for                                                                    
     an effective date."                                                                                                        
                                                                                                                                
1:03:59 PM                                                                                                                    
                                                                                                                                
Representative  Kawasaki  provided the  subcommittee  report                                                                    
for  the  Department of  Corrections.  He  relayed that  the                                                                    
subcommittee met over a series  of five meetings for a total                                                                    
of about  9 hours. On  the last  day, prior to  closing out,                                                                    
the subcommittee  took up budget amendments.  He forwarded 6                                                                    
amendment recommendations to the co-chairs.                                                                                     
                                                                                                                                
Co-Chair Seaton  guided members to the  amendment section of                                                                    
the packet.                                                                                                                     
                                                                                                                                
Representative  Kawasaki  reviewed   the  FY18  budget  with                                                                    
recommended Governor and subcommittee amendment totals:                                                                         
                                                                                                                                
     Fund Source: (dollars are in thousands)                                                                                    
                                                                                                                                
     Unrestricted General Funds (UGF): $257,758.2                                                                               
     Designated General Funds (DGF): $8,501.6                                                                                   
     Other Funds: $34,652.0                                                                                                     
     Federal Funds: $7,686.0                                                                                                    
     Total: $308,597.8                                                                                                          
                                                                                                                                
Representative Kawasaki  MOVED to  ADOPT Amendment 1  [GA 3]                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Administration and Support                                                                                                 
     Office of the Commissioner                                                                                                 
     GA 3 2/15 Community Resource for Justice                                                                                   
                                                                                                                                
     Grants    from   Community    Resource   for    Justice                                                                    
     Incorporated will be used  to support implementation of                                                                    
     justice  reform  efforts. This  is  a  new request  for                                                                    
     FY2018 and  was not  included in the  FY2018 governor's                                                                    
     request as these grant funds  were not available at the                                                                    
     time. The  Alaska Criminal Justice  Commission approved                                                                    
     this item in January 2017.                                                                                                 
                                                                                                                                
     Community Resource for Justice  Incorporated (CRJ) is a                                                                    
     Massachusetts nonprofit  corporation that  is assisting                                                                    
     the  State of  Alaska  with  implementation of  Justice                                                                    
     Reform.  The Crime  and Justice  Institute applied  for                                                                    
     and  was awarded  a federal  grant from  the Bureau  of                                                                    
     Justice (BOJ), Office of  Justice Programs for Criminal                                                                    
     Justice  Improvement and  Recidivism Reduction  through                                                                    
     the State-Level  Justice Reinvestment  Initiative. This                                                                    
     grant award allows  CRJ to issue sub  awards in efforts                                                                    
     to assist  agencies with funding  to meet  training and                                                                    
     statewide  coordination needs  as approved  by CRJ  and                                                                    
     the  BOJ. This  grant  will fund  a Coordinator  either                                                                    
     through a contract or non-perm  position to assist with                                                                    
     identifying   and  addressing   ongoing  implementation                                                                    
     issues, particularly those  that span several divisions                                                                    
     within  the department  as well  as coordinate  between                                                                    
     each state and local  stakeholders as well as reporting                                                                    
     needs for the Alaska Criminal Justice Commission.                                                                          
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Seaton clarified  that  Amendment  1 was  actually                                                                    
Amendment GA 3. Representative Kawasaki agreed.                                                                                 
                                                                                                                                
Representative  Kawasaki explained  that  the amendment  was                                                                    
passed  in  the  House  DOC   budget  subcommittee.  It  was                                                                    
originally offered by the governor  on February 15, 2017. It                                                                    
included grants to communities  from a national organization                                                                    
called  Community  Resource  for Justice  Incorporated.  The                                                                    
organization  obtained  much  of  its funding  from  the  US                                                                    
Department of Justice. The funding  was a one-time increment                                                                    
of statutory  designated program receipts.  The subcommittee                                                                    
discussion surrounded  where the  money would come  from and                                                                    
whether  it  would  supplant general  funds.  The  amendment                                                                    
proposal was forwarded for recommendation.                                                                                      
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION Amendment GA 3 was ADOPTED.                                                                            
                                                                                                                                
1:07:14 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:07:52 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  Seaton  explained  where members  could  find  the                                                                    
amendment  numbers  and  directed  them to  refer  to  their                                                                    
amendments using the same nomenclature.                                                                                         
                                                                                                                                
Representative  Kawasaki MOVED  to ADOPT  Amendment H  DOC 1                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Administration and Support                                                                                                 
     Office of the Commissioner                                                                                                 
     H DOC 1  - Transfer New Professional  Conduct Unit from                                                                    
     Correctional  Academy to  Commissioner's Office  (TrOut                                                                    
     337896)                                                                                                                    
     Linked to H  DOC 4 - Transfer  New Professional Conduct                                                                    
     Unit  from   Correctional  Academy   to  Commissioner's                                                                    
     Office                                                                                                                     
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     Transfer  the newly  created Professional  Conduct Unit                                                                    
     from  the Correctional  Academy  to the  Commissioner's                                                                    
     Office where  it is more appropriately  housed. The new                                                                    
     Investigative Unit  will work in coordination  with the                                                                    
     Department of Public Safety, Department  of Law and the                                                                    
     Office  of the  Governor  to  investigate external  and                                                                    
     internal   complaints   into  alleged   misconduct   or                                                                    
     criminal activities, on the part  of all DOC employees,                                                                    
     inmates, visitors, and contractors.                                                                                        
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative  Kawasaki  reviewed  that the  amendment  was                                                                    
technical  in   nature  and  transferred   the  Professional                                                                    
Conduct  Unit  currently   housed  within  the  Correctional                                                                    
Academy  to   the  Commissioner's  Office.  He   reported  a                                                                    
$714,500  undesignated general  fund  (UGF)  transfer and  3                                                                    
permanent  full-time positions.  The  committee believed  it                                                                    
was inappropriate to house the  unit within the Correctional                                                                    
Academy.                                                                                                                        
                                                                                                                                
Representative Wilson agreed with  the change offered in the                                                                    
amendment.  She  hoped  a   larger  discussion  would  ensue                                                                    
regarding the  positions, as they  were new  positions being                                                                    
proposed.  She  referred to  a  report  about whether  there                                                                    
should be  an internal  or external investigative  unit. The                                                                    
report  recommended  that  the  unit be  external.  She  was                                                                    
concerned about  adding new positions. She  remarked that an                                                                    
external  investigative unit  for  any  department would  be                                                                    
more  objective than  an internal  one.  She reiterated  her                                                                    
support of the move.                                                                                                            
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H DOC 1 was adopted.                                                                        
                                                                                                                                
Representative  Kawasaki MOVED  to ADOPT  Amendment H  DOC 2                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Administration and Support                                                                                                 
     Information Technology MIS                                                                                                 
     H  DOC  2  -  Delete  Positions  and  Funding  of  Four                                                                    
     Transferred  PCNs   from  Closed   Palmer  Correctional                                                                    
     Center                                                                                                                     
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     This  amendment deletes  four positions  and associated                                                                    
     operating   costs  transferred   to  this   allocation.                                                                    
     Savings and  positions from the  closure of  the Palmer                                                                    
     Correctional  Institution  were   transferred  to  this                                                                    
     allocation to  fund operations of  the MIS unit  of the                                                                    
     Department.  This  results  in four  new  positions  to                                                                    
     support MIS  operations. These positions  are currently                                                                    
     vacant  and   have  been  since  the   closure  of  the                                                                    
     institution.  Additionally, the  Department should  not                                                                    
     be  increasing   positions  while  the   Department  of                                                                    
     Administration  is  in  the  process  of  consolidating                                                                    
     information   technology  in   the   new  Division   of                                                                    
     Information Technology.  This amendment  will eliminate                                                                    
     this increase  of staff to  the MIS unit. It  will also                                                                    
     assist the  Department in arriving at  the cost savings                                                                    
     identified  in the  fiscal note  for  SB 91  associated                                                                    
     with inmate population reductions.                                                                                         
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative   Kawasaki  explained   that  the   amendment                                                                    
resulted  from a  recommendation  made by  a  member of  the                                                                    
budget subcommittee  to delete $546,200 UGF  and 4 permanent                                                                    
full-time  positions, which  were previously  at the  Palmer                                                                    
Correctional  Center   within  the   Information  Technology                                                                    
Department.  They suggested  transferring  the positions  to                                                                    
the   administrative   and   support   appropriations.   The                                                                    
committee discussed  that the positions were  vacant and had                                                                    
been  held open  without  being advertised.  He deferred  to                                                                    
Representative Wilson, as it was her amendment.                                                                                 
                                                                                                                                
Representative Wilson  further explained the  amendment. She                                                                    
indicated that although the  positions would be transferred,                                                                    
they were  new positions. They  had not been  advertised and                                                                    
remained vacant.  There was a  question about being  able to                                                                    
address  the issue  without  hiring  additional people.  She                                                                    
argued  that  if  the  positions   were  really  needed  the                                                                    
department  would have  been actively  trying to  fill them.                                                                    
She mentioned that  the amendment would also  help the state                                                                    
realize  the  savings  resulting  from the  closure  of  the                                                                    
Palmer  facility  based on  SB  91  [An omnibus  crime  bill                                                                    
passed in 2016].                                                                                                                
                                                                                                                                
Co-Chair  Seaton recognized  the  arrival of  Representative                                                                    
Pruitt to the meeting.                                                                                                          
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H DOC 2 was ADOPTED.                                                                        
                                                                                                                                
1:12:27 PM                                                                                                                    
                                                                                                                                
Representative  Kawasaki MOVED  to ADOPT  Amendment H  DOC 3                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Population Management                                                                                                      
     Pre-Trial Services                                                                                                         
     H DOC 3 - Efficiencies in Pre-Trial Services                                                                               
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     It  is   the  intent   of  the  legislature   that  the                                                                    
     Department  prioritize the  use  of existing  community                                                                    
     facilities  and resources  for  the Pre-trial  Services                                                                    
     Division when appropriate.                                                                                                 
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Kawasaki  detailed the amendment.  During the                                                                    
subcommittee   testimony   from   the   Pre-Trial   Services                                                                    
Division, it was  mentioned that they would  be looking into                                                                    
lease  space,  new  facility space,  or  enhancing  existing                                                                    
facility  space.   Members  had  questions   concerning  the                                                                    
locations  within each  of the  judicial districts.  Members                                                                    
felt  that   it  was   important  that   pre-trial  services                                                                    
considered  looking  at  being  housed  within  current  and                                                                    
existing locations including office  space the state already                                                                    
had in order to reduce its footprint overall.                                                                                   
                                                                                                                                
Representative  Wilson agreed  with the  amendment. However,                                                                    
she  wanted  to comment  about  the  previous year's  budget                                                                    
process. She  reported that there had  been discussion about                                                                    
the start-up  costs associated with Pre-Trial  Services. She                                                                    
reported that the cost was  not placed into the fiscal notes                                                                    
on purpose. The  state had $3 million sitting  in the budget                                                                    
for  the current  year  and $10  million  for the  following                                                                    
budget  year.  Presently,  only one  of  the  positions  was                                                                    
filled. During the subcommittee  process, a member mentioned                                                                    
that they wanted  to use the $3 million  for start-up costs.                                                                    
She was  concerned that the  services would not  begin until                                                                    
September or  October. The  implementation of  the Pre-Trial                                                                    
Services  was  supposed to  result  in  a large  savings  as                                                                    
outlined in  SB 91. She  noted that the stated  had invested                                                                    
$5 million in the division, yet it was not staffed.                                                                             
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION Amendment H DOC 3 was ADOPTED.                                                                         
                                                                                                                                
Representative  Kawasaki MOVED  to ADOPT  Amendment H  DOC 4                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Population Management                                                                                                      
     Correctional Academy                                                                                                       
     H DOC 4  - Transfer New Professional  Conduct Unit from                                                                    
     Correctional Academy to Commissioner's Office                                                                              
                                                                                                                                
     Linked to H  DOC 1 - Transfer  New Professional Conduct                                                                    
     Unit  from   Correctional  Academy   to  Commissioner's                                                                    
     Office (TrIn 337897)                                                                                                       
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     Transfer  the newly  created Professional  Conduct Unit                                                                    
     from  the Correctional  Academy  to the  Commissioner's                                                                    
     Office where  it is more appropriately  housed. The new                                                                    
     Investigative Unit  will work in coordination  with the                                                                    
     Department of Public Safety, Department  of Law and the                                                                    
     Office  of the  Governor  to  investigate external  and                                                                    
     internal   complaints   into  alleged   misconduct   or                                                                    
     criminal activities, on the part  of all DOC employees,                                                                    
     inmates, visitors, and contractors.                                                                                        
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Kawasaki  relayed that the amendment  was the                                                                    
corresponding   amendment  to   Amendment   H   DOC  1.   It                                                                    
transferred  money  from  the Correctional  Academy  to  the                                                                    
Commissioner's office.                                                                                                          
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H DOC 4 was ADOPTED.                                                                        
                                                                                                                                
Representative  Kawasaki MOVED  to ADOPT  Amendment H  DOC 5                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Population Management                                                                                                      
     Institution Director's Office                                                                                              
     H DOC 5 - Prioritize Solutions for Disparate High                                                                          
     Incarceration Rates of Alaska Natives                                                                                      
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     It  is   the  intent   of  the  legislature   that  the                                                                    
     Commissioner  of  the  Department of  Corrections  will                                                                    
     prioritize  funding  and  implement  solutions  to  the                                                                    
     disparity   in   Alaska  Native   incarceration   rates                                                                    
     throughout the state.                                                                                                      
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative   Kawasaki  explained   that  the   amendment                                                                    
contained  intent  language  and   that  there  had  been  a                                                                    
considerable  amount of  debate  on it  at the  subcommittee                                                                    
level.  The member  from the  Bethel Region  that introduced                                                                    
the  amendment  mentioned  that the  incarceration  rate  of                                                                    
Alaska Natives was  much higher than the rest  of the prison                                                                    
population. The  maker of  the amendment  wanted to  see the                                                                    
commissioner  address  the issue  and  to  find out  whether                                                                    
there were  underlying causes  including systemic  racism or                                                                    
economic disparities.                                                                                                           
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H DOC 5 was ADOPTED.                                                                        
                                                                                                                                
1:17:08 PM                                                                                                                    
                                                                                                                                
Representative  Kawasaki MOVED  to ADOPT  Amendment H  DOC 6                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Population Management                                                                                                      
     Electronic Monitoring                                                                                                      
     H DOC 6 - Electronic Monitoring in Bethel                                                                                  
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     It  is   the  intent   of  the  legislature   that  the                                                                    
     Commissioner  of  the  Department of  Corrections  will                                                                    
     prioritize expanding the  Electronic Monitoring program                                                                    
     to Bethel.                                                                                                                 
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative   Kawasaki  explained   that  the   amendment                                                                    
inserted intent  language that  would expand  the Electronic                                                                    
Monitoring Program  to Bethel. There were  several places in                                                                    
which electronic monitoring was already in place.                                                                               
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H DOC 6 was ADOPTED.                                                                        
                                                                                                                                
Co-Chair  Seaton  pointed  out  that  there  were  no  other                                                                    
amendments for the DOC budget for the current day.                                                                              
                                                                                                                                
Representative  Wilson wanted  to  add  to the  subcommittee                                                                    
report on Page  5 that the amendment  looked at out-of-state                                                                    
locations to  place prisoners who  were already  in maximum-                                                                    
security  facilities in  Alaska. It  was not  her intent  to                                                                    
release maximum-security prisoners  on electronic monitoring                                                                    
systems  when  they  required  additional  supervision.  The                                                                    
department  had  regulations  and   processes  in  place  to                                                                    
determine  who  could  be  on  the  monitoring  system.  She                                                                    
emphasized that  the committee  did not  want to  change the                                                                    
policies   and  procedures   currently  in   place  by   the                                                                    
department.                                                                                                                     
                                                                                                                                
Representative   Kawasaki   concurred  with   Representative                                                                    
Wilson's characterization.  The committee  used some  of the                                                                    
language that  was within the explanation  of the amendment,                                                                    
much  of  which was  corrected  in  the budget  subcommittee                                                                    
process. High-level offenders and  offenders that should not                                                                    
be  on  the street  on  electronic  monitoring or  within  a                                                                    
community  residential  center  would  not  be  eligible  to                                                                    
participate.  The   committee  discussed   the  commissioner                                                                    
continuing  to look  at other  options  for housing  inmates                                                                    
out-of-state and for potential savings in other areas.                                                                          
                                                                                                                                
Co-Chair Seaton  thanked the subcommittee  for its  work. He                                                                    
indicated the  Department of Fish  and Game was up  next. He                                                                    
relayed that that  there were 15 amendments for  DFG none of                                                                    
which were language amendments.                                                                                                 
                                                                                                                                
1:21:21 PM                                                                                                                    
                                                                                                                                
Representative Ortiz reported that  the House Finance Budget                                                                    
Subcommittee for the Department of  Fish and Game held eight                                                                    
meetings with the department during  the review of the FY 18                                                                    
budget  request, which  totaled  about 10  hours of  meeting                                                                    
time.  The committee  looked into  the department's  overall                                                                    
budget.  He reported  that there  were  3 governor's  budget                                                                    
amendments  and   9  amendments   proposed  by   the  budget                                                                    
subcommittee.  He reviewed  the budget  with the  amendments                                                                    
totals:                                                                                                                         
                                                                                                                                
     Fund Source: (dollars are in thousands)                                                                                    
                                                                                                                                
     Unrestricted General Funds (UGF): $50,516.4                                                                                
     Designated General Funds (DGF): $14,897.5                                                                                  
     Other State Funds: $68,903.1                                                                                               
     Federal Funds: $67,019.5                                                                                                   
     Total:    $201,336.5                                                                                                       
                                                                                                                                
Representative Ortiz  noted that  the department had  seen a                                                                    
total reduction  of $28,871 (UGF)  reductions from FY  15 to                                                                    
FY 18.  The total UGF  reduction percentage was 36.  He read                                                                    
from the report:                                                                                                                
                                                                                                                                
     Representative  Tarr  voiced  the importance  of  sport                                                                    
     fishing to Alaska's culture and economy.                                                                                   
                                                                                                                                
     I have not  put forward for consideration  by the House                                                                    
     Finance Committee a proposal  which would have utilized                                                                    
     $50.0  from  the  Fish   and  Game  Commercial  Fishing                                                                    
     subfund for Amount  Necessary for Subsistence household                                                                    
     surveys in  non-subsistence areas. The  committee votes                                                                    
     ended in a tie after substantial discussion.                                                                               
                                                                                                                                
     Several   subcommittee  members   voiced  support   for                                                                    
     reformation  of   the  sport  guide   logbook  process.                                                                    
     Representative  Stutes  also  noted that  there  is  no                                                                    
     freshwater  sportfish  guide vessel  registration  fee,                                                                    
     and no freshwater sport fish guide fee.                                                                                    
                                                                                                                                
Co-Chair Seaton reemphasized  that the amendment transaction                                                                    
detail could  be found on  the landscape-formatted  pages of                                                                    
each  subcommittee report.  He asked  members to  move their                                                                    
amendments  by the  same  title as  noted  on the  amendment                                                                    
detail.                                                                                                                         
                                                                                                                                
1:25:07 PM                                                                                                                    
                                                                                                                                
Representative Ortiz MOVED to ADOPT Amendment GA 7 (copy on                                                                     
file):                                                                                                                          
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Southeast Region Fisheries Management                                                                                      
     GA  7  2/15 Coho  Salmon  and  Dive Fisheries  Research                                                                    
     Projects                                                                                                                   
                                                                                                                                
     This  will  allow  support  from  private  industry  to                                                                    
     support  various  escapement,   stock  assessment,  and                                                                    
     survey projects. This  is a new request  for FY2018. It                                                                    
     was  not  included  in  the  FY2018  Governor's  budget                                                                    
     because  the scope  of the  projects  were still  being                                                                    
     identified.                                                                                                                
                                                                                                                                
     Northern  Fund Pacific  Salmon Commission  is providing                                                                    
     $87.1 for  the Boundary  Area Coho  Escapement project.                                                                    
     This project proposes to sample  chum releases from the                                                                    
     Canadian   area   3   commercial  seine   and   gillnet                                                                    
     fisheries.                                                                                                                 
                                                                                                                                
     Northern  Fund Pacific  Salmon Commission  is providing                                                                    
     $54.0  for the  Hugh  Smith Coho  project. The  primary                                                                    
     purpose  of this  project is  to maintain  an indicator                                                                    
     stock  assessment  program  for   Coho  salmon  in  the                                                                    
     northern  boundary area.  The  operation  of the  smolt                                                                    
     weir  is to  enumerate and  coded-wire tag  Coho salmon                                                                    
     smolts  emigrating from  Hugh  Smith  Lake to  generate                                                                    
     total  population  estimates,   including  total  smolt                                                                    
     production,  marine  survival, exploitation  rate,  and                                                                    
     catch by area, time, and gear type.                                                                                        
                                                                                                                                
     Southeast  Alaska Regional  Dive Fisheries  Association                                                                    
     is providing  $50.0 for the  cucumber and  geoduck dive                                                                    
     fisheries surveys. These surveys  must be done in order                                                                    
     to have a fishery.                                                                                                         
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Ortiz supplied some  brief comments as to the                                                                    
overall  intention of  the proposed  amendments. He  relayed                                                                    
that  the  UGF  reduction  of 36  percent  resulted  in  the                                                                    
department having  to abandon  some important  projects that                                                                    
involved gathering  data such as escapement  levels. In some                                                                    
cases,  the   department  was   forced  to   implement  test                                                                    
fisheries  in   order  to  generate   revenue  to   pay  for                                                                    
particular  surveys   and  data  collection.   Certain  data                                                                    
collection was imperative to the  industry in terms of being                                                                    
able to  manage fisheries properly. The  amendments were not                                                                    
increasing the department's  overall budget. Instead, monies                                                                    
were being moved from  the Administrative Services Division,                                                                    
the  Commissioner's  Office,  and the  Commercial  Fisheries                                                                    
Entry  Commission  to  fund  some  of  the  data  collection                                                                    
projects.  He had  received feedback  from fishing  industry                                                                    
participants  expressing  concern  about  opportunities  for                                                                    
fisherman  to catch  fish, provide  for their  families, and                                                                    
put added monies into the  economy. They were also concerned                                                                    
about the  potential reduction in  fish tax revenue  for the                                                                    
State  of Alaska.  The idea  behind the  amendments were  to                                                                    
ensure that  DFG was able  to conduct the  studies necessary                                                                    
to allow the maximum  sustainable yield for Alaska's fishing                                                                    
industry.                                                                                                                       
                                                                                                                                
Co-Chair  Seaton clarified  that  the  subcommittee did  not                                                                    
change the  department's budget; its  role was to  work with                                                                    
the  department  to  rearrange its  funding.  Representative                                                                    
Ortiz  agreed. He  explained Amendment  GA 7.  The amendment                                                                    
would allow for receipt authority  in the event that a third                                                                    
party would  be successful  in fund  raising for  a project.                                                                    
The  amendment did  not guarantee  funding for  projects. It                                                                    
supported  a boundary  area Coho  escapement  project and  a                                                                    
stock  assessment  program for  Coho.  It  also allowed  for                                                                    
receipt authority  from the  Southeast Alaska  Regional Dive                                                                    
Fisheries   Association   to   contribute  to   dive   stock                                                                    
assessments.                                                                                                                    
                                                                                                                                
1:29:06 PM                                                                                                                    
                                                                                                                                
Representative  Wilson asked  Representative  Ortiz for  the                                                                    
definition of  a test fishery  for clarity. She  asked about                                                                    
funding  for   the  test  fisheries.   Representative  Ortiz                                                                    
replied  that DFG  was credited  for employing  some of  the                                                                    
best fisheries  management practices  around the  world. The                                                                    
department  typically  conducted  test fisheries  to  access                                                                    
stock  and  escapement.  There  were  other  test  fisheries                                                                    
designed  to  generate  revenue. The  department  contracted                                                                    
with a  particular commercial fisherman  to catch  a certain                                                                    
number of fish. For  example, one contract generated $50,000                                                                    
in  revenues for  the  department, which  was  used to  fund                                                                    
assessment projects  that included flying. He  was trying to                                                                    
reduce  the  use of  certain  test  fisheries because  other                                                                    
fishermen could not  fish at the same time  test fishing was                                                                    
going  on. Those  fishermen would  see the  test fishery  as                                                                    
competition.                                                                                                                    
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment GA 7 was ADOPTED.                                                                           
                                                                                                                                
Representative Ortiz MOVED to ADOPT  Amendment H DFG 1 (copy                                                                    
on file):                                                                                                                       
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Southeast Region Fisheries Management                                                                                      
     H DFG 1  - Replace $50.0 SDPR funding  from SARDFA with                                                                    
     Fish  and   Game  Funds  to  maintain   Dive  Fisheries                                                                    
     Assessments                                                                                                                
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     This  fund change  will allow  Commercial Fisheries  to                                                                    
     continue to  administer Dive Fishery  Stock Assessments                                                                    
     without  having   to  increase  the   Southeast  Alaska                                                                    
     Regional  Divers   Association's  fees  by   48%  (from                                                                    
     $103,900 to  $153,900). The  Alaska Department  of Fish                                                                    
     and  Game  Funding  used   comes  from  the  Commercial                                                                    
     Fisheries portion of the Fish and Game Fund.                                                                               
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative  Ortiz  detailed   the  amendment.  The  fund                                                                    
change  would allow  the  Commercial  Fisheries Division  to                                                                    
continue to administer dive  stock assessments through DFG's                                                                    
commercial fishing sub fund.  The Southeast Regional Diver's                                                                    
Association (SARDFA)  would not be asked  to contribute more                                                                    
than  it already  had, approximately  $103,000 per  year, to                                                                    
the  cost  of  the  stock assessment.  The  amendment  would                                                                    
eliminate  the  need  for  the  department  to  ask  for  an                                                                    
additional   $50,000   from   SARDFA  to   fund   assessment                                                                    
activities.                                                                                                                     
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H DFG 1 was ADOPTED.                                                                        
                                                                                                                                
1:33:03 PM                                                                                                                    
                                                                                                                                
Representative Ortiz MOVED to ADOPT Amendment GA 8 2/15                                                                         
(copy on file):                                                                                                                 
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Central Region Fisheries Management                                                                                        
     GA  8  2/15  Bristol  Bay  Science  Research  Institute                                                                    
     Watershed Projects (FY18-FY19)                                                                                             
                                                                                                                                
     This will  allow support from  Bristol Bay  Science and                                                                    
     Research   Institute   (BBSRI)   to   support   various                                                                    
     escapement  and test  projects. This  is a  new request                                                                    
     for  FY2018.   It  was  not  included   in  the  FY2018                                                                    
     Governor's budget because  discussions on the agreement                                                                    
     were still ongoing.                                                                                                        
     Bristol Bay Science and  Research Institute (BBSRI) has                                                                    
     entered into a memorandum  of agreement with the Alaska                                                                    
     Department  of  Fish  and Game  (ADF&G)  to  provide  a                                                                    
     framework  upon which  (ADF&G)  and  BBSRI may  jointly                                                                    
     plan, fund and  accomplish mutually beneficial projects                                                                    
     and activities  within the Bristol Bay  watershed. Such                                                                    
     activities  and projects  will complement  the missions                                                                    
     of ADF&G and  BBSRI and be in the best  interest of the                                                                    
     fishery  resources and  communities within  the Bristol                                                                    
     Bay watershed.                                                                                                             
                                                                                                                                
     The  following  are  the  anticipated  projects  to  be                                                                    
     funded  with the  FY2018 $800.0  revenue contract.  The                                                                    
     project  listing  will be  updated  in  FY2019 and  are                                                                    
     anticipated to cost $800.0.                                                                                                
                                                                                                                                
     Nushagak Sonar- $50.0                                                                                                      
     Togiak Tower- $60.0                                                                                                        
     Igushik Tower- $50.0                                                                                                       
     Kvichak inside test- $40.0                                                                                                 
     Egegik River inside test- $43.0                                                                                            
     Ugashik inside test - $47.0                                                                                                
     District Catch Sampling- $100.0                                                                                            
     Port Moller test- $120.0                                                                                                   
     Management Biologist trainee west side- $60.0                                                                              
     Catch allocation genetics- $80.0                                                                                           
     Togiak Aerial Herring (forecast model)- $50.0                                                                              
     Alagnak River Escapement- $40.0                                                                                            
     Nushagak Sonar for Coho and Pink- $60.0                                                                                    
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Ortiz WITHDREW Amendment GA 8.                                                                                   
                                                                                                                                
Representative Ortiz MOVED to ADOPT H DFG 2 (copy on file):                                                                     
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Southeast Region Fisheries Management                                                                                      
     H DFG 2 - Add SE Partial Salmon Aerial Surveys project                                                                     
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Utilize savings from Administrative Services, the                                                                          
     Commissioner's Office and CFEC to fund the SE Partial                                                                      
     Salmon Aerial Surveys: 119.2                                                                                               
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Ortiz  spoke to  his amendment.  He indicated                                                                    
that   the  amendment   would  utilize   savings  from   the                                                                    
Commissioner's  Office   and  Administration   Services  for                                                                    
partial salmon  aerial surveys. He  argued that  the surveys                                                                    
were vital  to Alaska's  economy. He suggested  that without                                                                    
the surveys  fishing areas could  not be opened  and fishing                                                                    
businesses  would  struggle  to operate.  The  surveys  were                                                                    
currently  funded  by  revenue  test  fishing  which  harmed                                                                    
Alaska's economy and fishing businesses.                                                                                        
                                                                                                                                
Representative  Wilson  asked if  FY  17  monies were  being                                                                    
used. Representative  Ortiz explained  that monies  would be                                                                    
used from the  FY 18 budget for activities in  the summer of                                                                    
the current year.                                                                                                               
                                                                                                                                
Representative Wilson  asked if  another amendment  would be                                                                    
offered   that  would   take   money   from  another   area.                                                                    
Representative  Ortiz  responded   in  the  affirmative.  He                                                                    
informed the  committee that there would  be amendments that                                                                    
moved   money   from    the   Commissioner's   Office,   the                                                                    
Administrative Services  Division, and from CFEC  to pay for                                                                    
the costs.                                                                                                                      
                                                                                                                                
Representative    Wilson   suggested    that   corresponding                                                                    
amendments be offered one after  another or together because                                                                    
of her concerns about  increasing the budget. Representative                                                                    
Ortiz agreed with Representative Wilson's point.                                                                                
                                                                                                                                
Co-Chair  Seaton reemphasized  that  there was  a series  of                                                                    
amendments   with   fund   source   transfers   within   the                                                                    
department. There  was not  an increase  to the  budget. The                                                                    
amendments were  being offered for the  purpose of operation                                                                    
efficiency. Some  programs were  being deleted  and replaced                                                                    
with those considered more vital.                                                                                               
                                                                                                                                
Representative  Wilson appreciated  the chairman's  remarks.                                                                    
She wanted  it clear to the  public that the budget  was not                                                                    
being increased.                                                                                                                
                                                                                                                                
Representative Ortiz  would refer  to the areas  where there                                                                    
were deletions in order to make up for the additions.                                                                           
                                                                                                                                
1:36:45 PM                                                                                                                    
                                                                                                                                
Representative  Pruitt  agreed  with  Representative  Wilson                                                                    
that there needed  to be more clarity and  more detail about                                                                    
additions   and    their   corresponding    reductions.   He                                                                    
appreciated more  detail about  what the committee  would be                                                                    
removing and about any potential impacts.                                                                                       
                                                                                                                                
Co-Chair  Seaton  pointed to  page  7,  line 12.  There  was                                                                    
$162,000 and  $355,000 being  subtracted. The  total amounts                                                                    
reflected an  accumulation of  reductions and  the additions                                                                    
being  equal. He  indicated he  would direct  Representative                                                                    
Ortiz to reference the information.                                                                                             
                                                                                                                                
Representative   Pruitt   understood   the   committee   was                                                                    
discussing  one amendment  at a  time. However,  he believed                                                                    
there  was a  need to  discuss the  corresponding amendments                                                                    
together to understand them. He provided an example.                                                                            
                                                                                                                                
Representative Ortiz added  that the Administrative Services                                                                    
Director, Carol Petraborg, was available for questions.                                                                         
                                                                                                                                
Representative  Wilson commented  that she  did not  need to                                                                    
hear from  the director. Her  concern was about  being asked                                                                    
to  vote on  an increase.  If  the increase  passed and  the                                                                    
decreases failed,  the result  would be  an increase  to the                                                                    
budget.  She  wondered if  it  was  possible to  buddle  the                                                                    
amendments together, making a transfer change.                                                                                  
                                                                                                                                
Representative Ortiz spoke to  the difficulty of lumping the                                                                    
amendments together.                                                                                                            
                                                                                                                                
1:41:08 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
1:50:39 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Representative Ortiz WITHDREW his MOTION to ADOPT Amendment                                                                     
H DFG 2.                                                                                                                        
                                                                                                                                
There being NO OBJECTION, it was so ordered.                                                                                    
                                                                                                                                
Representative Ortiz MOVED to ADOPT Amendment H DGF 2, H                                                                        
DFG 3, H DFG 4, H DFG 5, H DFG 6, H DFG 7, H DFG 8, H DFG                                                                       
9, H DFG 10, H DFG 11, and H DFG 12 (copy on file):                                                                             
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Southeast Region Fisheries Management                                                                                      
     H DFG 2 - Add SE Partial Salmon Aerial Surveys project                                                                     
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Utilize  savings  from   Administrative  Services,  the                                                                    
     Commissioner's Office  and CFEC to fund  the SE Partial                                                                    
     Salmon Aerial Surveys: 119.2                                                                                               
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Central Region Fisheries Management                                                                                        
     H  DFG 3  -  Add Projects:  PWS  Pink Salmon  Recovery,                                                                    
     Upper Cook Inlet Offshore Test Fish GF                                                                                     
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Increment  of  funding  from   CFEC  receipts  for  the                                                                    
     following CEN  programs: PWS Pink Salmon  CWT Recovery:                                                                    
     106.6                                                                                                                      
     Upper Cook Inlet Offshore Test Fish GF: 44.1                                                                               
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Central Region Fisheries Management                                                                                        
     H DFG 4 - Add Coghill River Weir Project                                                                                   
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Utilize UGF  reductions from the  Commissioner's Office                                                                    
     and   Administrative   Services  for   Central   Region                                                                    
     fisheries management projects.  CEN Coghill River Weir:                                                                    
     41.6                                                                                                                       
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Central Region Fisheries Management                                                                                        
     H DFG 5 - Add Togiak Tower project                                                                                         
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Utilize    UGF   from    Commissioner's   Office    and                                                                    
     Administrative  Services for  CEN Fisheries  Management                                                                    
     Project:                                                                                                                   
     CEN Togiak Tower (FM-20416): 60.0                                                                                          
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Central Region Fisheries Management                                                                                        
     H DFG 6 - Add Project: Igushik Tower                                                                                       
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Use UGF  savings from reductions in  the Commissioner's                                                                    
     Office and Administrative Services to fund:                                                                                
     Igushik Tower: 50.0                                                                                                        
                                                                                                                                
     Commercial Fisheries                                                                                                       
     AYK Region Fisheries Management                                                                                            
     H DFG 7 - Add Kuskokwim River Projects                                                                                     
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Add funding for the following projects:                                                                                    
     Fishery Monitoring Kuskokwim River: 26.0                                                                                   
     Kuskokwim River Run Assessment: 10.0                                                                                       
     Kuskokwim River Subsistence Monitoring: 10.0                                                                               
     Fishery Monitoring Kuskokwim Bay (AYK: FM-30521): 5.9                                                                      
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Westward Region Fisheries Management                                                                                       
     H DFG  8 -  Add projects: Yukon  River Fall  Season TF,                                                                    
     Kodiak Salmon  Weir Support, Chignik  Salmon Management                                                                    
     Support                                                                                                                    
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Use UGF  savings from reductions in  the Commissioner's                                                                    
     Office and Administrative Services to fund:                                                                                
     Yukon River Fall Season TF: 5.5                                                                                            
     Kodiak Salmon Weir Support: 34.8                                                                                           
     Chignik Salmon Management Support: 16.9                                                                                    
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Commercial Fisheries Entry Commission                                                                                      
     H DFG  9 - Decrement  funding to reflect  reductions in                                                                    
     CFEC's workload                                                                                                            
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     Two reviews  of the Commercial Fisheries  Limited Entry                                                                    
     Commission (CFEC) were completed  and noted that CFEC's                                                                    
     workload  had   diminished  over  time  and   that  the                                                                    
     organization   structure  and   funding  level   should                                                                    
     reflect the workload changes.                                                                                              
                                                                                                                                
     Because    DFG    believed    it    could    streamline                                                                    
     administrative  and  research   functions  while  still                                                                    
     providing   appropriate  support   to  the   commercial                                                                    
     fishing industry  in the State,  in FY17,  the Governor                                                                    
     submitted an  amendment that reduced CFEC's  funding by                                                                    
     $1,330.4--the  legislature  reduced  the  decrement  to                                                                    
     $650.4.  This transaction  removes another  $317.2 with                                                                    
     the understanding  that DFG will  be able  to implement                                                                    
     streamlining administrative functions.                                                                                     
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Commercial Fisheries Entry Commission                                                                                      
     H DFG  10 - Add back  CFEC receipts as IncOTI  to allow                                                                    
     time to implement efficiencies                                                                                             
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     One  time  only  increment  to   CFEC  allows  time  to                                                                    
     implement additional efficiencies.  The funding will be                                                                    
     removed in FY19.                                                                                                           
                                                                                                                                
     Statewide Support Services                                                                                                 
     Commissioner's Office                                                                                                      
     H DFG  11 - Delete  UGF from the  Commissioner's Office                                                                    
     to increase Fisheries Management projects                                                                                  
     Offered by Representative Ortiz                                                                                            
                                                                                                                                
     UGF  in Fisheries  Management  has  decreased by  26.1%                                                                    
     since   FY15.  The   decreased   funding   has  had   a                                                                    
     significant  impact  on  the  department's  ability  to                                                                    
     manage its  commercial fisheries, which  also decreases                                                                    
     opportunities  for  sport  fishing, personal  use,  and                                                                    
     subsistence.  This   proposal  removes  UGF   from  the                                                                    
     Commissioner's Office and divisions  will be charged to                                                                    
     support  the services  provided  by the  Commissioner's                                                                    
     Office. The  decremented funding  will be used  to fund                                                                    
     projects in Commercial Fisheries.                                                                                          
                                                                                                                                
     Statewide Support Services                                                                                                 
     Administrative Services                                                                                                    
     H DFG 12 - Decrement UGF in Admin                                                                                          
     Services to fund  Fisheries Management Projects Offered                                                                    
     by Representative Ortiz                                                                                                    
                                                                                                                                
     UGF  in Fisheries  Management  has  decreased by  26.1%                                                                    
     since   FY15.  The   decreased   funding   has  had   a                                                                    
     significant  impact  on  the  department's  ability  to                                                                    
     manage its  commercial fisheries, which  also decreases                                                                    
     opportunity  for  sport   fishing,  personal  use,  and                                                                    
     subsistence.  This  proposal  removes  UGF  from  Admin                                                                    
     Services and  divisions will be charged  to support the                                                                    
     services  provided by  Admin Services.  The decremented                                                                    
     funding  will be  used to  fund  projects in  Fisheries                                                                    
     Management.                                                                                                                
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Pruitt  wanted to understand better  what was                                                                    
being removed.  He did not need  to know the details  of the                                                                    
projects but wanted more  information about the implications                                                                    
in the years to follow. He wondered about their longevity.                                                                      
                                                                                                                                
Representative Ortiz  requested that Amanda Ryder  and Carol                                                                    
Petraborg  make themselves  available for  questions at  the                                                                    
table.                                                                                                                          
                                                                                                                                
1:52:49 PM                                                                                                                    
                                                                                                                                
AMANDA  RYDER,  ANALYST,  DIVISION OF  LEGISLATIVE  FINANCE,                                                                    
introduced herself.                                                                                                             
                                                                                                                                
CAROL    PETRABORG,   ADMINISTRATIVE    SERVICES   DIRECTOR,                                                                    
DEPARTMENT OF FISH AND GAME, introduced herself.                                                                                
                                                                                                                                
Ms.  Ryder explained  that the  increments  included in  the                                                                    
budget were ongoing and were  placed in the base budget each                                                                    
year,  as  were  the  decrements. The  decrements  from  the                                                                    
Commissioner's Office  and from the  Administrative Services                                                                    
Division were permanent.                                                                                                        
                                                                                                                                
Representative  Pruitt asked  why the  Commissioner's Office                                                                    
felt the  money could  be removed from  its budget.  He also                                                                    
wondered about  the importance of  the projects  or programs                                                                    
the  state  would  pay  for  in  perpetuity.  Ms.  Petraborg                                                                    
explained  that  when  the  department  started  the  budget                                                                    
reductions in  FY 15 it  put forth  a plan for  cost cutting                                                                    
measures and  efficiencies. The department knew  a few years                                                                    
prior that it  would not have any UGF  in the Commissioner's                                                                    
Office  and the  Division  of  Administrative Services.  The                                                                    
department  had  been  implementing efficiency  measures  to                                                                    
reduce  UGF incrementally.  She reported  that the  projects                                                                    
being  implemented  in  the  Commercial  Fisheries  Division                                                                    
supplanted GF reductions that had  already occurred in FY 16                                                                    
and FY  17. The projects  were longstanding - some  had been                                                                    
in place for  years and others for decades.  The money would                                                                    
fund the continuation of the projects.                                                                                          
                                                                                                                                
Representative Wilson  asked about  the adjustments  made to                                                                    
licensing fees.  Ms. Petraborg  responded that  the increase                                                                    
in the licensing  fees were fish and game  funds, which were                                                                    
"Other" funds.                                                                                                                  
                                                                                                                                
Representative  Wilson   asked  about  36  percent   of  the                                                                    
department's  funds   being  reduced.  She   wondered  about                                                                    
additional monies  coming in from  an increase in  fees. She                                                                    
was curious about the offset.  Ms. Ryder thought there was a                                                                    
fund change in  the Division of Sport Fish  and the Division                                                                    
of  Wildlife Conservation  in  the  amount of  approximately                                                                    
$5.4 million  between FY 17 and  FY 18 budget. A  portion of                                                                    
the 36  percent increase  counted a  fund change.  There was                                                                    
not a total fund decrease of 36 percent.                                                                                        
                                                                                                                                
1:56:46 PM                                                                                                                    
                                                                                                                                
Representative   Wilson  asked   for  clarify   about  which                                                                    
amendments were  not a part  of the amendment  grouping. Co-                                                                    
Chair Seaton  clarified that GA  8 and  GA 9 would  be dealt                                                                    
with    following    the    amendments    currently    under                                                                    
consideration.                                                                                                                  
                                                                                                                                
Representative Tilton  asked the testifiers to  speak to the                                                                    
selection  process  of  projects  that  were  included.  Ms.                                                                    
Petraborg relayed that the  Division of Commercial Fisheries                                                                    
met with  industry and  reviewed the  list of  projects that                                                                    
were previously cut. The list was then prioritized.                                                                             
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being  NO OBJECTION, Amendments  H DFG  2, H DFG  3, H                                                                    
DFG 4, H  DFG 5, H DFG 6, H  DFG 7, H DFG 8, H  DFG 9, H DFG                                                                    
10, H DFG 11, and H DFG 12 were ADOPTED.                                                                                        
                                                                                                                                
1:58:26 PM                                                                                                                    
                                                                                                                                
Representative Ortiz MOVED to ADOPT  Amendment GA 8 and GA 9                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Central Region Fisheries Management                                                                                        
     GA  8  2/15  Bristol  Bay  Science  Research  Institute                                                                    
     Watershed Projects (FY18-FY19)                                                                                             
                                                                                                                                
     This will  allow support from  Bristol Bay  Science and                                                                    
     Research   Institute   (BBSRI)   to   support   various                                                                    
     escapement  and test  projects. This  is a  new request                                                                    
     for  FY2018.   It  was  not  included   in  the  FY2018                                                                    
     Governor's budget because  discussions on the agreement                                                                    
     were still ongoing.                                                                                                        
                                                                                                                                
     Bristol Bay Science and  Research Institute (BBSRI) has                                                                    
     entered into a memorandum  of agreement with the Alaska                                                                    
     Department  of  Fish  and Game  (ADF&G)  to  provide  a                                                                    
     framework  upon which  (ADF&G)  and  BBSRI may  jointly                                                                    
     plan, fund and  accomplish mutually beneficial projects                                                                    
     and activities  within the Bristol Bay  watershed. Such                                                                    
     activities  and projects  will complement  the missions                                                                    
     of ADF&G and  BBSRI and be in the best  interest of the                                                                    
     fishery  resources and  communities within  the Bristol                                                                    
     Bay watershed.                                                                                                             
                                                                                                                                
     The  following  are  the  anticipated  projects  to  be                                                                    
     funded  with the  FY2018 $800.0  revenue contract.  The                                                                    
     project  listing  will be  updated  in  FY2019 and  are                                                                    
     anticipated to cost $800.0.                                                                                                
                                                                                                                                
     Nushagak Sonar- $50.0                                                                                                      
     Togiak Tower- $60.0                                                                                                        
     Igushik Tower- $50.0                                                                                                       
     Kvichak inside test- $40.0                                                                                                 
     Egegik River inside test- $43.0                                                                                            
     Ugashik inside test - $47.0                                                                                                
     District Catch Sampling- $100.0                                                                                            
     Port Moller test- $120.0                                                                                                   
     Management Biologist trainee west side- $60.0                                                                              
     Catch allocation genetics- $80.0                                                                                           
     Togiak Aerial Herring (forecast model)- $50.0                                                                              
     Alagnak River Escapement- $40.0                                                                                            
     Nushagak Sonar for Coho and Pink- $60.0                                                                                    
                                                                                                                                
     Commercial Fisheries                                                                                                       
     Statewide Fisheries Management                                                                                             
     GA 9 2/15 Stock Assessment Projects                                                                                        
                                                                                                                                
     This  will  allow  support  from  private  industry  to                                                                    
     support stock  assessments. This  is a new  request for                                                                    
     FY2018. It  was not  included in the  FY2018 Governor's                                                                    
     budget  because the  scope of  the projects  were still                                                                    
     being identified.                                                                                                          
                                                                                                                                
     Mat-Su Borough is providing $116.0  for the Coho Salmon                                                                    
     Genetic  Stock  Identification  project.  This  project                                                                    
     will  estimate the  total  abundance  of selected  Coho                                                                    
     salmon   stocks   by   leveraging   expiring   projects                                                                    
     estimation Coho  salmon escapements. The  Mat-Su salmon                                                                    
     information inventory and  gap analysis determined that                                                                    
     the  state  of  knowledge  for  stock  abundance  stock                                                                    
     identification  was  only   moderate  for  Coho  salmon                                                                    
     (available  information was  incomplete) so  additional                                                                    
     work was needed.                                                                                                           
                                                                                                                                
     Pacific  States Marine  Fisheries Council  is providing                                                                    
     $52.0  for  the  Northern  Cook  Inlet  Chinook  Marine                                                                    
     Harvest  Stock  Composition  project. This  project  is                                                                    
     needed  to  gather   information  about  stock-specific                                                                    
     harvests of  Chinook salmon  in the  Tyonek subsistence                                                                    
     and  northern district  commercial  mixed stock  marine                                                                    
     fisheries.                                                                                                                 
                                                                                                                                
     Pacific  States Marine  Fisheries Council  is providing                                                                    
     $15.0 for  the Eastside  Set Net Chinook  Genetic Stock                                                                    
     Identification project. This project  is needed to help                                                                    
     better understand the trends  and causes of declines in                                                                    
     Chinook salmon abundance in the Kenai River.                                                                               
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair Seaton directed members' attention to pages 3                                                                          
and 5.                                                                                                                          
                                                                                                                                
Representative  Ortiz reviewed  the  amendments. He  relayed                                                                    
that GA  8 allowed for  increased receipt authority  for the                                                                    
event  of  a  third  party   that  would  be  successful  in                                                                    
fundraising for a project. The  projects were not guaranteed                                                                    
funding through  the amendment, although  a third  party had                                                                    
signed a memorandum of understanding with the department.                                                                       
                                                                                                                                
Representative Ortiz  explained GA 9. The  amendment allowed                                                                    
receipt authority in  the event of a third  party that would                                                                    
be successful in the Mat-Su and Norther Cook Inlet Region.                                                                      
                                                                                                                                
Representative Pruitt  referred to Amendment GA  8 and asked                                                                    
who  would be  paying and  about the  program longevity.  He                                                                    
asked what would happen to a  program if the third party did                                                                    
not  raise enough  funds. Ms.  Petraborg  reported that  the                                                                    
projects  were previously  funded  with GF  dollars and  had                                                                    
been cut.  She reported that industry  participants had come                                                                    
together  to raise  funds to  continue certain  projects. If                                                                    
industry did not fund the projects, they would cease.                                                                           
                                                                                                                                
Ms.  Ryder explained  that Amendment  GA 8  was a  temporary                                                                    
increment  for  FY  18  and  FY 19.  The  other  project  in                                                                    
Amendment  GA 9  was a  one-time increment.  Both amendments                                                                    
were entered as temporary increments.                                                                                           
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There  being NO  OBJECTION, Amendments  GA 8  and GA  9 were                                                                    
ADOPTED.                                                                                                                        
                                                                                                                                
Co-Chair Seaton  indicated that the subcommittee  report for                                                                    
Department of Health and Social Services (DHSS) was next.                                                                       
                                                                                                                                
2:02:49 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara read  his report  for Department  of Health                                                                    
and Social Services:                                                                                                            
                                                                                                                                
     The   House  Finance   Budget   Subcommittee  for   the                                                                    
     Department  of Health  and Social  Services held  seven                                                                    
     meetings with  the department during the  review of the                                                                    
     FY18 budget request.  These meetings included overviews                                                                    
     from  the Divisions  of  Medicaid  Services, Office  of                                                                    
     Children's  Services,  Behavioral  Health,  Senior  and                                                                    
     Disabilities  Services,  Pioneer   Homes,  Health  Care                                                                    
     Services, and Public Health.  The Subcommittee also had                                                                    
     discussions   regarding   the   results   of   Medicaid                                                                    
     Expansion and Reform and  the findings of privatization                                                                    
     feasibility  studies   of  the  Division   of  Juvenile                                                                    
     Justice,  Alaska  Psychiatric  Institute,  and  Pioneer                                                                    
     Home Pharmacy Services.                                                                                                    
                                                                                                                                
Vice-Chair  Gara commented  that  the DHSS  budget had  been                                                                    
difficult  to   review  because  the  department   had  seen                                                                    
substantial  reductions  - about  $190  million  - over  the                                                                    
previous few years. The subcommittee  distributed all of the                                                                    
proposed  amendments,   whether  or  not  they   passed.  He                                                                    
continued to read from his report:                                                                                              
                                                                                                                                
     The Chair of the  House Finance Budget Subcommittee for                                                                    
     the   Department   of   Health  and   Social   Services                                                                    
     recommends that the House  Finance Committee accept the                                                                    
     Governor's FY 18 budget with the following amendments:                                                                     
                                                                                                                                
     The budget without amendment totals:                                                                                       
     Fund Source: (dollars are in thousands)                                                                                    
                                                                                                                                
     Unrestricted General Funds (UGF): $1,063,072.8                                                                             
     Designated General Funds (DGF): $70,375.2                                                                                  
     Other Funds: $118,746.3                                                                                                    
     Federal Funds: $1,436,744.8                                                                                                
     Total: $2,724,939.1                                                                                                        
                                                                                                                                
     The  Unrestricted General  Fund difference  from FY  15                                                                    
     Management Plan  to the FY  18 Governor  Amended budget                                                                    
    is a reduction of $190,577.4, a decrease of 15.2%.                                                                          
                                                                                                                                
     The  Unrestricted  General  Fund difference  from  FY17                                                                    
     Management Plan to the FY18  Governor Amended budget is                                                                    
     a reduction of $21,271.4, a decrease of 2.0%.                                                                              
                                                                                                                                
Vice-Chair  Gara  reported  that  there  were  no  statutory                                                                    
change  proposals, although  he  noted  that the  department                                                                    
wanted  to see  some  fees increased.  The subcommittee  was                                                                    
going  to introduce  an amendment.  However, the  department                                                                    
was  still reviewing  its  fee  increases. His  subcommittee                                                                    
hoped  it would  be able  to view  something in  the current                                                                    
session. He  noted that Representative  Johnston had  made a                                                                    
comment  about wanting  the department  to look  at possibly                                                                    
reducing  Medicaid reimbursement  costs. The  department had                                                                    
responded that it was already looking at doing so.                                                                              
                                                                                                                                
Vice-Chair  Gara   continued  to   review  his   report.  He                                                                    
indicated that  four amendments  did not  pass. He  noted he                                                                    
had supplied copies  of the amendments to  members. The four                                                                    
amendments that  passed were discussed  in the  narrative of                                                                    
the  subcommittee   report.  The  amendments  he   would  be                                                                    
offering were  listed in the  transaction detail  report. He                                                                    
relayed that  Amendment H HSS 1  and Amendment H HSS  3 were                                                                    
originally  one amendment  during  the subcommittee  process                                                                    
and he  would be  offering them  together. He  reviewed that                                                                    
the  amendment would  reallocate UGF  from the  Adult Public                                                                    
Assistance  Program to  the  Office  Of Children's  Services                                                                    
(OCS).  He would  be addressing  the  amendment first,  then                                                                    
proceed  to the  second amendment  regarding the  Nome Youth                                                                    
Facility. He  would move onto the  fourth amendment relating                                                                    
to  the wordage  traditionally in  the budget.  There was  a                                                                    
language amendment  recommended by the committee  that would                                                                    
be heard the  following day and offered  by Co-Chair Seaton.                                                                    
It was a  cost-neutral amendment to address  the backlog for                                                                    
food stamps and  other benefits. Currently, it  took about a                                                                    
month to apply for food stamps before receiving them.                                                                           
                                                                                                                                
Vice-Chair  Gara  MOVED  to  ADOPT Amendment  H  HSS  1  and                                                                    
Amendment H HSS 3.                                                                                                              
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair  Gara  explained  that   currently  there  was  a                                                                    
massive shortage of  caseworkers at OCS. As  a result, youth                                                                    
remained in  foster care  for a  longer period,  which meant                                                                    
waiting longer  to be reunited  with family or to  be placed                                                                    
into a  permanent home. He  reported that the  system burned                                                                    
out about 50  percent of new caseworkers  within their first                                                                    
year.  The  state repeatedly  spent  money  on training  and                                                                    
recruitment for the positions. He  informed members that the                                                                    
purpose of the  amendment was to reduce the  number of cases                                                                    
for  new  caseworkers.  He  reported  that  the  recommended                                                                    
caseload at  OCS was 12  cases per caseworker. The  idea was                                                                    
for  caseworkers to  be able  to  move youth  as quickly  as                                                                    
possible into  permanent homes or  back with  their original                                                                    
family. In Wasilla, there were  43 cases per caseworker, 350                                                                    
percent  above what  was  recommended.  In Fairbanks,  there                                                                    
were 24  cases per caseworker;  about 100 percent  more than                                                                    
what  they should  have  to  deal with.  In  6 offices,  the                                                                    
caseworker caseload was between 30 and 36.                                                                                      
                                                                                                                                
Vice-Chair   Gara  continued   that  the   amendment  solely                                                                    
addressed reducing  the caseloads  for new  caseworkers. The                                                                    
amount was about equal to  the amount already in the budget.                                                                    
He thought that  with additional funding the  state would be                                                                    
able to  reduce the number  of cases for new  caseworkers to                                                                    
the  federally recommended  caseload. New  caseworkers would                                                                    
have  6 case  per  caseworker  in their  first  3 months  of                                                                    
training; twelve  cases within the  first 6 months;  and the                                                                    
state  would  leverage  a  75   percent  federal  match.  He                                                                    
believed  that with  the savings  the subcommittee  found in                                                                    
the  budget, the  state was  about  halfway there.  Training                                                                    
increased to  a gold standard  would allow the state  to get                                                                    
to  New Jersey  numbers. The  amendment would  add staff  to                                                                    
reduce  new  caseworker  caseloads, increase  training,  add                                                                    
mentors,  and add  necessary supervisors  and support  staff                                                                    
for caseworkers.                                                                                                                
                                                                                                                                
Vice-Chair Gara reviewed some numbers.  He reported that the                                                                    
$3.29 million  came from  a savings  identified by  DHSS and                                                                    
LFD and  found in the Adult  Public Assistance appropriation                                                                    
for FY  2012. They  believed Alaska  was about  $3.5 million                                                                    
over what  the state needed to  pay the benefits for  FY 18.                                                                    
He reported  using $3.29 million  of the  over appropriation                                                                    
for Public Assistance.  In the end, the  amendment would not                                                                    
raise  the governor's  proposed  budget.  Instead, it  would                                                                    
move what  had been confirmed  by the department and  LFD as                                                                    
an over  appropriation in  one area  to try  to fix  a major                                                                    
problem in  another area. The department  had testified that                                                                    
the  change  would  improve  lives  and  children's  outcome                                                                    
without  increasing the  overall budget.  The amendment  was                                                                    
passed from  subcommittee on a vote  of 6 to 3  in favor. He                                                                    
urged members to support the amendment.                                                                                         
                                                                                                                                
Representative  Pruitt  asked  that the  committee  take  up                                                                    
H HSS  3, the  corresponding decrement,  prior to  voting on                                                                    
H HSS 1. Co-Chair Seaton clarified  that the amendments were                                                                    
moved together.                                                                                                                 
                                                                                                                                
Representative  Pruitt did  not realize  the amendments  had                                                                    
been moved together.  He spoke to his  concerns about adding                                                                    
31  positions.  He  was   also  concerned  about  increasing                                                                    
funding to  OCS because, as  he recalled in  a presentation,                                                                    
when  there  was a  reduction  in  caseloads, there  was  an                                                                    
increase in the number of  children that were moved into the                                                                    
system.  He thought  there would  be more  time provided  to                                                                    
search for more  families and find kids that  might not have                                                                    
some of  the same challenges  as other children.  There were                                                                    
some  cases  where families  had  to  fight the  system.  He                                                                    
thought it  was great  to have found  a saving  within Adult                                                                    
Public Assistance. He was not  sure about transferring money                                                                    
to OCS he believed that OCS  had a management problem at its                                                                    
core.                                                                                                                           
                                                                                                                                
Representative  Wilson wanted  to direct  a question  to the                                                                    
Office  of  Public  Assistance.  She  spoke  of  a  previous                                                                    
presentation  that discussed  the  state  being required  to                                                                    
have a  certain amount of  GF money to match  federal funds.                                                                    
She reported  that upon her  review of the Office  of Public                                                                    
Assistance budget  she had  found the  same amount  as Vice-                                                                    
Chair  Gara.  She  remembered   a  discussion  about  losing                                                                    
federal  funding relating  to  Medicaid as  the state's  UGF                                                                    
decreased. She wondered if any  federal funding would be put                                                                    
in jeopardy with the adoption of the amendment.                                                                                 
                                                                                                                                
2:14:57 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara explained that  the discussion that occurred                                                                    
the previous  year had to  do with Temporary  Assistance for                                                                    
Needy  Families  (TANF) money.  The  state  had to  spend  a                                                                    
certain amount  of money  to avoid  getting a  TANF penalty.                                                                    
The  amendment was  dealing  with  Adult Public  Assistance,                                                                    
which did not  count towards the TANF  maintenance of effort                                                                    
discussed in the prior year.                                                                                                    
                                                                                                                                
Co-Chair Seaton  asked Representative  Wilson if  she wanted                                                                    
to  direct her  question to  the department.  Representative                                                                    
Wilson responded  affirmatively. She had read  the narrative                                                                    
that indicated the money was  used. There was a concern from                                                                    
the department about a decrease  in the number of cases. She                                                                    
reported  that the  narrative outlined  that  the state  was                                                                    
also required, once  a certain amount of money  was sent for                                                                    
Adult  Public  Assistance,  to  continue  funding  the  same                                                                    
amount or a penalty would be assessed.                                                                                          
                                                                                                                                
JESSICA BOGARD, ADMINISTRATIVE  OPERATIONS MANAGER, DIVISION                                                                    
OF  PUBLIC ASSISTANCE  (via teleconference),  responded that                                                                    
the  state had  a  maintenance of  effort  for Adult  Public                                                                    
Assistance that  required $60.1  million in  state spending.                                                                    
If  the  state did  not  meet  that  amount, it  would  lose                                                                    
Medicaid benefits for all of Alaska.                                                                                            
                                                                                                                                
Representative Wilson wondered if  other state funding would                                                                    
be  jeopardized if  the legislature  removed the  money from                                                                    
Adult Public  Assistance. Ms. Bogard  replied that  when the                                                                    
department looked at  the projections and how  the state met                                                                    
the maintenance of effort using  Adult Public Assistance for                                                                    
state FY 16  for the federal FY 16 the  state benefited from                                                                    
using the  Permanent Fund Dividend (PFD)  hold harmless fund                                                                    
and  from  using a  small  portion  of the  senior  benefits                                                                    
payments.  Relying on  the two  funds allowed  the state  to                                                                    
meet  the   maintenance  of  effort.  She   added  that  any                                                                    
decreases  would  increase  the state's  reliance  on  those                                                                    
other funding streams.                                                                                                          
                                                                                                                                
2:17:23 PM                                                                                                                    
                                                                                                                                
Representative Wilson asked  if there would be  an issue for                                                                    
the state, for example, if it  spent $30 million in 2013 and                                                                    
only  $25 million  in  2017. Ms.  Board  responded that  the                                                                    
state  met its  maintenance of  effort for  Medicaid through                                                                    
one  method where  the state  had to  maintain the  previous                                                                    
federal fiscal year spend. The  state would have an issue if                                                                    
the amount decreased. The state  could choose to switch to a                                                                    
second  method  to  meet  the  maintenance  of  effort.  She                                                                    
explained that it  would be to revert certain  payments to a                                                                    
level from 1983.                                                                                                                
                                                                                                                                
Representative  Wilson   also  objected  to   the  amendment                                                                    
because even  though in previous  years the  legislature had                                                                    
appropriated additional monies, the  state had not hired any                                                                    
additional workers. She  mentioned a study from  a few years                                                                    
previously  about whether  caseworkers needed  to be  social                                                                    
workers. Her  concern with adding  money to a  broken system                                                                    
was that it  would not fix the system. She  would rather see                                                                    
the system fixed. Keeping children  in their home longer, if                                                                    
it could  be done safely,  was the most affordable  and best                                                                    
way  of  keeping  families together.  She  relayed  that  in                                                                    
previous  years when  additional funding  was provided  more                                                                    
children  entered the  system. She  wondered if  all of  the                                                                    
children in  the system  should be  there. She  believed the                                                                    
finance committee  should be  spending more  time on  one of                                                                    
the largest  growing industries and  affected so  many other                                                                    
areas of the  state budget. She thought  the amendment would                                                                    
make things worse for the state.  She also noted that in the                                                                    
budget for Adult Public Assistance  it was clear that if the                                                                    
state started removing  money from it, other  areas would be                                                                    
affected as well.                                                                                                               
                                                                                                                                
2:20:16 PM                                                                                                                    
                                                                                                                                
Representative  Tilton  was  concerned  about  appropriating                                                                    
small   amounts  of   money  rather   than  addressing   the                                                                    
underlying   issue.   She   expressed  concerns   with   the                                                                    
maintenance of  effort and having  to find money  within the                                                                    
Division   of  Public   Assistance.  She   added  that   the                                                                    
department, having  the ability to move  some monies around,                                                                    
could have looked at doing so as an alternative.                                                                                
                                                                                                                                
Vice-Chair Gara provided an amendment  wrap up. He explained                                                                    
that  the subcommittee  was very  careful about  making sure                                                                    
the  state  was not  going  to  deny  benefits to  a  single                                                                    
eligible  person who  qualified  for  Public Assistance.  He                                                                    
furthered that  it was  made clear  to him  by LFD  and DHSS                                                                    
that  the  state  would  not deny  benefits  to  anyone  who                                                                    
qualified for  Adult Public Assistance. He  relayed that the                                                                    
maintenance of effort issue was  not a problem, as the state                                                                    
was  putting more  into Public  Assistance than  it was  two                                                                    
years previously. He reported that  LFD noted that the state                                                                    
did not  need to  add $6  million in  funding when  not many                                                                    
qualified  for  assistance.  He   reported  a  $3.5  million                                                                    
excess.  He understood  Representative Tilton's  point about                                                                    
fixing the  system. However, he  argued that OCS  could only                                                                    
absorb so many  staff in one year. He did  not want to delay                                                                    
fixing the  system. He  asked members  for their  support of                                                                    
the  amendments, which  resulted  in the  same cost  savings                                                                    
over  the  prior year  in  the  budget over  the  governor's                                                                    
proposal.                                                                                                                       
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative Wilson OBJECTED.                                                                                                 
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Gara, Grenn, Guttenberg,  Kawasaki, Ortiz, Foster,                                                                    
Seaton                                                                                                                          
OPPOSED: Pruitt, Thompson, Tilton, Wilson                                                                                       
                                                                                                                                
The MOTION PASSED (7/4).                                                                                                        
                                                                                                                                
Amendment H HSS 1 and Amendment H HSS 3 were ADOPTED.                                                                           
                                                                                                                                
Vice-Chair Gara  MOVED to ADOPT  Amendment H HSS 2  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Juvenile Justice                                                                                                           
     McLaughlin Youth Center                                                                                                    
     H HSS 2 - DJJ Intent                                                                                                       
     Offered by Representative Gara                                                                                             
                                                                                                                                
     It  is the  intent  of the  legislature  that the  Nome                                                                    
     Youth  Facility not  be closed  if the  cost of  moving                                                                    
     youth  from the  Nome Youth  Facility, maintaining  the                                                                    
     vacated   facility,  transporting   youth  to   another                                                                    
     facility, and other related costs  erase the savings of                                                                    
     closing the facility.                                                                                                      
                                                                                                                                
Co-Chair Foster OBJECTED for discussion.                                                                                        
                                                                                                                                
Vice-Chair  Gara explained  that Amendment  H HSS  2 was  an                                                                    
intent  amendment.  He  relayed  that since  the  state  was                                                                    
dealing  with a  budget crisis  the department  attempted to                                                                    
save money by closing youth  facilities. He suggested it was                                                                    
possible  the state  would save  money by  closing the  Nome                                                                    
Youth  Facility.  He  conveyed   that  the  legislature  had                                                                    
ordered  a privatization  report, which  concluded that  the                                                                    
Nome  Youth Facility  "was a  unique valuable  facility that                                                                    
performs exceptionally well in  meeting the needs of at-risk                                                                    
youth in a difficult-to-serve  area." He reviewed the intent                                                                    
language that passed the  subcommittee [See above language].                                                                    
He  relayed  some of  the  potential  costs to  closing  the                                                                    
facility:  travel   expenses  for  transporting   youth  for                                                                    
hearings, facility  maintenance costs, and  costs associated                                                                    
with  a   variety  of  other  services.   He  mentioned  the                                                                    
possibility of moving  the Nome Youth occupants  to a closed                                                                    
facility within the McLaughlin  Youth Facility in Anchorage.                                                                    
If youth were transferred there,  the facility would have to                                                                    
be reopened costing  additional monies. He was  unsure if it                                                                    
would be cost neutral to  keep the Nome Youth Facility open.                                                                    
The amendment would leave the  issue of closing the facility                                                                    
open for discussion.                                                                                                            
                                                                                                                                
2:26:07 PM                                                                                                                    
                                                                                                                                
Representative Wilson  asked to hear from  the department on                                                                    
the  issue.  She wanted  to  understand  why the  department                                                                    
recommended closing the particular  facility and some of the                                                                    
specifics  about  a closure.  She  hoped  a study  had  been                                                                    
conducted.                                                                                                                      
                                                                                                                                
KAREN  FORREST, DEPUTY  COMMISSIONER,  DEPARTMENT OF  HEALTH                                                                    
AND SOCIAL  SERVICES, answered  that a  portion of  the Nome                                                                    
operating  budget   was  removed  through   the  legislative                                                                    
process in the  previous year in the amount  of $1.6 million                                                                    
and reinstated  as one-time funding. Through  the governor's                                                                    
budget  process   the  department  did  not   reinstate  the                                                                    
funding, nor  did the  legislature. One  of the  issues that                                                                    
was discussed had to do with  the utilization of some of the                                                                    
facilities. She  reported that what  changed from  the prior                                                                    
year was  that the  department had seen  an increase  in the                                                                    
utilization   of  some   the   facilities.  Currently,   the                                                                    
McLaughlin  Youth   Center  was   running  at   102  percent                                                                    
utilization. The  Nome Youth Facility was  currently running                                                                    
an average daily population of  about 8. In prior years, the                                                                    
facility was  running at  about 5  to 6  youth. There  was a                                                                    
change  in  the  nature  of  juvenile  crime  trends,  which                                                                    
influenced the overall picture.                                                                                                 
                                                                                                                                
Representative Wilson  asked what type of  offenders were in                                                                    
the  Nome  Youth  Facility.  She  asked  if  the  high-level                                                                    
offenders were  kept in Anchorage.  Ms. Forrest  answered in                                                                    
the negative.  The detention units were  secure. Youth could                                                                    
be held in detention units for  only a couple of reasons: If                                                                    
they were  a risk  to the community  or themselves,  or they                                                                    
were a  flight risk in  terms of being available  for court.                                                                    
Generally, someone had  to be a risk to the  community or to                                                                    
themselves. The  department preferred  to hold youth  in the                                                                    
detention facility closest  to their home. The  youth in the                                                                    
Nome Youth Facility were from the Nome Region.                                                                                  
                                                                                                                                
Representative Wilson  asked about  a cost comparison  for 8                                                                    
youth moving  to an Anchorage  facility versus  remaining at                                                                    
the  Nome Youth  Facility.  Ms. Forrest  noted  the cost  to                                                                    
serve  the  youth was  higher  in  Nome than  in  Anchorage,                                                                    
although she did not have specific figures with her.                                                                            
                                                                                                                                
Representative Wilson  remarked that she would  have thought                                                                    
the department  would have brought  their numbers  with them                                                                    
to the House Finance Committee.                                                                                                 
                                                                                                                                
2:30:21 PM                                                                                                                    
                                                                                                                                
Representative   Ortiz  mentioned   that  Ms.   Forrest  had                                                                    
testified that the McLaughlin  Youth Center utilization rate                                                                    
was  at 102  percent. He  wondered if  the Nome  youth would                                                                    
have  a place  to  go  if the  facility  closed. Ms.  Forest                                                                    
replied that the department would  have to look at where the                                                                    
best place would be for the  youth to go depending on safety                                                                    
and security  issues. For example,  McLaughlin was  a 25-bed                                                                    
unit. In  the previous  week, the facility  had 32  youth in                                                                    
the  unit, a  number that  was not  sustainable in  the long                                                                    
run. If the trends in Anchorage  were that more youth had to                                                                    
be detained  because of  their risk  to reoffend,  the state                                                                    
might have to send youth  to Bethel or Fairbanks where there                                                                    
was capacity in their detention units.                                                                                          
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION                                                                                          
                                                                                                                                
Representative Wilson OBJECTED.                                                                                                 
                                                                                                                                
Representative  Wilson  argued  that  the  legislature  kept                                                                    
telling  the  department  to  find   ways  of  doing  things                                                                    
differently to facilitate reductions.  She did not think the                                                                    
difference between 5  and 8 youth was  substantial enough to                                                                    
justify  the  amendment.  She  understood  wanting  to  keep                                                                    
children closer  to home. However,  she thought  there might                                                                    
be other ways  to try to make it happen  without the related                                                                    
costs.                                                                                                                          
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Gara, Grenn,  Guttenberg, Kawasaki, Ortiz, Foster,                                                                    
Seaton                                                                                                                          
OPPOSED: Pruitt, Thompson, Tilton, Wilson                                                                                       
                                                                                                                                
The MOTION PASSED (7/4).                                                                                                        
                                                                                                                                
Amendment H HSS 3 was ADOPTED.                                                                                                  
                                                                                                                                
Vice-Chair Gara  MOVED to ADOPT  Amendment H HSS 4  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Department Support Services                                                                                                
     Commissioner's Office                                                                                                      
     H HSS 4 - Replace Governor's Department level $25                                                                          
     million Transfer Wordage                                                                                                   
     Offered by Representative Gara                                                                                             
                                                                                                                                
     At   the  discretion   of  the   Commissioner  of   the                                                                    
     Department  of  Health  and   Social  Services,  up  to                                                                    
     $25,000,000    may   be    transferred   between    all                                                                    
     appropriations in  the Department of Health  and Social                                                                    
     Services, except Medicaid Services.                                                                                        
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair  Gara  explained  that  the  amendment  reflected                                                                    
traditional  language   that  had  been  used   in  previous                                                                    
budgets.  The  amendment would  place  a  limitation on  the                                                                    
administration.  It   would  allow  the   administration  to                                                                    
transfer  up to  $25  million between  divisions. He  argued                                                                    
that  it  was  important  not  to  send  a  message  to  the                                                                    
divisions, which would encourage  them to spend every penny.                                                                    
Another  division  might have  a  greater  funding need.  ON                                                                    
occasion funds lapsed, which  happened in the Commissioner's                                                                    
Office.   The  amendment   would   allow  transfers   within                                                                    
divisions  but would  not allow  transfers between  Medicaid                                                                    
and other  divisions. He provided an  example. The amendment                                                                    
drew  a  wall  between  Medicaid and  other  divisions.  The                                                                    
amendment  would only  allow $25  million to  be transferred                                                                    
between the other  divisions. In 5 of the  previous 6 years,                                                                    
the legislature  had included  similar language.  He pointed                                                                    
out that if  there was an under  appropriation for Medicaid,                                                                    
the division  would have  to request  a supplemental  in the                                                                    
following year.                                                                                                                 
                                                                                                                                
2:35:02 PM                                                                                                                    
                                                                                                                                
Representative  Wilson  asked  how much  money,  outside  of                                                                    
Medicaid, was not used by  the department in the prior year.                                                                    
Vice-Chair Gara deferred to the department.                                                                                     
                                                                                                                                
SHAWNDA  O'BRIEN,  ASSISTANT   COMMISSIONER,  DEPARTMENT  OF                                                                    
HEALTH AND SOCIAL SERVICES, explained  that for the previous                                                                    
year's  budget the  department was  using  a new  accounting                                                                    
system.  She  relayed  that the  numbers  used  at  year-end                                                                    
closing  were used  for lapsed  balances  under $10  million                                                                    
UGF. She conveyed  that the department tended  to lapse more                                                                    
funds such as other fund sources or federal funding.                                                                            
                                                                                                                                
Representative Wilson  asked if Adult Public  Assistance was                                                                    
counted as  Medicaid funding. Ms. O'Brien  answered that the                                                                    
Adult Public  Assistance Program was funding  the department                                                                    
used to  meet the  maintenance of  effort for  Medicaid. The                                                                    
money was not Medicaid funding.                                                                                                 
                                                                                                                                
Representative Wilson asked if the  same $3 million that was                                                                    
previously mentioned  could have  made up  a portion  of the                                                                    
$25 million transfer if the  department had chosen to do so.                                                                    
Ms.  O'Brien responded  in the  affirmative. The  department                                                                    
could have used those funds  elsewhere if the department had                                                                    
needed to.                                                                                                                      
                                                                                                                                
Representative Wilson  thought it  was interesting  that the                                                                    
committee  was  entertaining  an amendment  allowing  a  $25                                                                    
million transfer  within any  division other  than Medicaid.                                                                    
Yet, the  committee had heard  earlier about  the importance                                                                    
of  having  additional  caseworkers  within  OCS.  In  other                                                                    
words, the  department had the  authority to  transfer money                                                                    
to  OCS. In  her opinion,  the $25  million could  have been                                                                    
used if  the issue had been  important enough to do  so. She                                                                    
asked if any  of the $25 million in previous  years had been                                                                    
used  to  transfer  between divisions.  She  wondered  where                                                                    
transfers  had typically  originated. Ms.  O'Brien responded                                                                    
to   Representative  Wilson's   first  question   concerning                                                                    
whether  the  department could  have  used  the funding  for                                                                    
additional  OCS  caseworkers.   The  department  could  have                                                                    
transferred  the  funding but  it  would  not have  had  the                                                                    
additional  needed positions.  The  funding  could not  have                                                                    
been  used  in the  same  way  the amendment  intended.  The                                                                    
department had not  had a need to move the  funding. She was                                                                    
unaware   of   any   funding   being   transferred   between                                                                    
appropriations  using the  authority.  She  relayed that  in                                                                    
prior years  there had been  some transfers made  within the                                                                    
Medicaid   appropriation.   The    amendment   limited   the                                                                    
department from having the ability to do so.                                                                                    
                                                                                                                                
Representative   Tilton   clarified   that   the   amendment                                                                    
addressed  the  governor's  language removing  the  Medicaid                                                                    
services portion. Ms. O'Brien concurred.                                                                                        
                                                                                                                                
Representative Tilton relayed that  if the amendment was not                                                                    
approved,  the department  would be  able to  transfer funds                                                                    
between all  DHSS divisions including Medicaid.  Ms. O'Brien                                                                    
responded in the positive.                                                                                                      
                                                                                                                                
Representative  Tilton  indicated  that  it  was  stated  in                                                                    
committee that  the language  had become  standard language.                                                                    
She believed  the language was  first included in the  FY 14                                                                    
budget. The reason  the $25 million was  approved for moving                                                                    
between  divisions  was due  to  the  implementation of  the                                                                    
Medicaid  Management Information  System (MMIS).  There were                                                                    
challenges with the  system and a fear  that providers would                                                                    
not be paid because there  was not enough funds available to                                                                    
pay providers.  She asked  if she  was correct.  Ms. O'Brien                                                                    
believed  that the  department testified  on  the issue  and                                                                    
agreed with Representative Tilton.                                                                                              
                                                                                                                                
Representative  Tilton  asked  if the  language  had  become                                                                    
standard even though  it had not been used.  Ms. O'Brian did                                                                    
not believe the department utilized  it in the previous year                                                                    
largely because of the difficulties  with the new accounting                                                                    
system.  She reported  that the  department  tended to  only                                                                    
lapse  a small  amount of  general fund  dollars. It  lapsed                                                                    
more funding under federal authority  and other lines within                                                                    
the budget.                                                                                                                     
                                                                                                                                
2:40:16 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara  relayed that originally the  department was                                                                    
allowed   to  transfer   $50   million  between   divisions.                                                                    
Presently, $25  million was the allowable  amount. He agreed                                                                    
with Representative Tilton that  without the amendment money                                                                    
could  be  transferred  between  Medicaid  and  non-Medicaid                                                                    
divisions.  In response  to  Representative Wilson's  point,                                                                    
the administration  could bolster OCS by  transferring money                                                                    
around. However,  he argued  that without  the legislature's                                                                    
approval  the department  would  be  subject to  significant                                                                    
criticism.                                                                                                                      
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H HSS 4 was ADOPTED.                                                                        
                                                                                                                                
Vice-Chair Gara remarked that the  only other amendment that                                                                    
he had  was a  language amendment to  reduce the  food stamp                                                                    
waiting  list,  which  would  be   addressed  later  in  the                                                                    
amendment process.                                                                                                              
                                                                                                                                
Co-Chair Seaton indicated that there were no further                                                                            
amendments for DHSS.                                                                                                            
                                                                                                                                
2:42:02 PM                                                                                                                    
At EASE                                                                                                                         
                                                                                                                                
2:53:17 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Seaton clarified that the Judiciary subcommittee                                                                       
report would be heard next. He invited Vice-Chair Gara to                                                                       
review the report.                                                                                                              
                                                                                                                                
Vice-Chair Gara read from his report:                                                                                           
                                                                                                                                
     The   House  Finance   Budget   Subcommittee  for   the                                                                    
     Judiciary  held five  meetings, with  the Alaska  Court                                                                    
     System  in attendance,  during the  review of  the FY18                                                                    
     budget request.                                                                                                            
                                                                                                                                
     The Chair of the  House Finance Budget Subcommittee for                                                                    
     the    Judiciary    recommends     that,    with    the                                                                    
     recommendations  outlined  in  this report,  the  House                                                                    
     Finance  Committee accept  the FY18  Governor's Amended                                                                    
     budget.                                                                                                                    
                                                                                                                                
     The Governor's FY18 Amended budget totals:                                                                                 
                                                                                                                                
     Fund Source: (dollars are in thousands)                                                                                    
                                                                                                                                
     Unrestricted General Funds (UGF): $104,838.6                                                                               
     Designated General Funds (DGF): $518.0                                                                                     
     Other Funds: $2,206.1                                                                                                      
     Federal Funds: $1,225.6                                                                                                    
     Total: $108,788.3                                                                                                          
                                                                                                                                
     The  Unrestricted  General  Fund difference  from  FY15                                                                    
     Management Plan  to the FY18 Governor's  Amended budget                                                                    
     is a reduction of $6,888.6, a decrease of 6.0 percent.                                                                     
                                                                                                                                
     The  Unrestricted  General  Fund difference  from  FY17                                                                    
     Management Plan  to the FY18 Governor's  Amended budget                                                                    
     is a reduction of $2,074.7, a decrease of 1.9 percent.                                                                     
                                                                                                                                
     The   following   statutory  recommendation   is   also                                                                    
     submitted to the House Finance Committee.                                                                                  
                                                                                                                                
     1. Amend  AS 22.25.020 to replace  the current Judicial                                                                    
     Retirement System for  retirement pension payments with                                                                    
     a  more  modest  pension.  This  recommendation  is  to                                                                    
     create a  new tier for the  Judicial Retirement System.                                                                    
     The  current Judicial  Retirement System  allows for  a                                                                    
     judge or justice to receive  5% of his/her pay per year                                                                    
     served, up  to 15 years (or  75% of pay). At  ten years                                                                    
     of service,  that represents, roughly, an  $80,000 (for                                                                    
     a  District Court  judge) to  $100,000  (for a  Supreme                                                                    
     Court justice) pension.  Geographic differential is not                                                                    
     considered.  Constitutionally,  this  statutory  change                                                                    
     would affect  only judges and justices  hired after the                                                                    
     passage    of     such    legislation.     We    cannot                                                                    
     constitutionally    alter   retirement    benefits   or                                                                    
    contribution rates for those already in the system.                                                                         
                                                                                                                                
Vice-Chair  Gara commented  that he  thought the  amount was                                                                    
excessive in  the state's tight fiscal  times. The committee                                                                    
disagreed  with  an exact  proposal  but  agreed to  make  a                                                                    
statutory   provision  to   reduce  the   retirement  earned                                                                    
payment, a  savings measure. He  reported that 5  new judges                                                                    
would likely be appointed.                                                                                                      
                                                                                                                                
Vice-Chair   Gara   highlighted    that   the   subcommittee                                                                    
considered 4 amendments from the  governor and 11 amendments                                                                    
from  the  subcommittee.  The  amendments  that  passed  and                                                                    
failed were distributed to all  members of the committee. He                                                                    
recommended  2 of  his amendments  and 4  of the  governor's                                                                    
amendments for consideration.                                                                                                   
                                                                                                                                
Co-Chair Seaton directed members  to turn to the transaction                                                                    
pages in the landscape format.                                                                                                  
                                                                                                                                
2:57:14 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara  MOVED to ADOPT  Amendment H JUD 1  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Alaska Court System                                                                                                        
     Trial Courts                                                                                                               
     H JUD 1 - Increase Filing Fee in Superior Court                                                                            
     Offered by Representative Gara                                                                                             
                                                                                                                                
     It  is the  intent of  the legislature  that the  court                                                                    
     system  raise the  filing  fee from  $200  to $500  for                                                                    
     Superior Court  monetary damage  claims of  $100,000 or                                                                    
     more.                                                                                                                      
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair  Gara  explained   that  the  amendment  included                                                                    
intent  language  to be  placed  in  the budget.  The  court                                                                    
system   indicated  they   would  take   the  recommendation                                                                    
seriously, although  the legislature could not  dictate what                                                                    
it  did with  intent language.  The intent  language was  an                                                                    
attempt to  increase revenue from  the court system  to help                                                                    
pay  for its  costs. The  money  would go  into the  general                                                                    
fund, and  the legislature  would decide how  to appropriate                                                                    
it.  The  court  system  recently raised  filing  fees.  The                                                                    
subcommittee   targeted  one   particular  filing   fee  for                                                                    
Superior  Court  cases of  claims  for  monetary damages  of                                                                    
$100,000 or more. A person  filed monetary damage claims for                                                                    
$100 thousand or more in  Superior Court. Small claims cases                                                                    
and smaller claims  cases were heard in  district court. The                                                                    
subcommittee limited the fee to  the Superior Court monetary                                                                    
damage  claims. The  intent  language  encouraged the  court                                                                    
system  to raise  its fee  from $200  to $500.  The increase                                                                    
would  generate about  $240,000 in  revenue for  the general                                                                    
fund minus  any fees waived  by the court system.  The court                                                                    
system had a fee waiver for the indignant.                                                                                      
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H JUD 1 was ADOPTED.                                                                        
                                                                                                                                
Vice-Chair Gara  MOVED to ADOPT  Amendment H JUD 2  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Alaska Court System                                                                                                        
     Trial Courts                                                                                                               
                                                                                                                                
     H JUD 2 - Delete Conditional Language                                                                                      
     Offered by Representative Gara                                                                                             
                                                                                                                                
     Delete conditional language that states: "Budget                                                                           
     requests from agencies of the Judicial Branch are                                                                          
     transmitted as requested."                                                                                                 
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair Gara  explained that the  amendment traditionally                                                                    
came  in  the original  budget.  It  stated that  the  court                                                                    
system  budget   would  be  exactly  as   submitted  to  the                                                                    
legislature.  He  thought  the statutory  language  was  not                                                                    
needed. The legislature  traditionally removed the language,                                                                    
as it  was likely to  be inaccurate  by the time  the budget                                                                    
was passed.                                                                                                                     
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H JUD 2 was ADOPTED.                                                                        
                                                                                                                                
3:00:13 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara MOVED  to ADOPT  Amendment GA  39 (copy  on                                                                    
file):                                                                                                                          
                                                                                                                                
     Therapeutic Courts                                                                                                         
     GA 39 2/15 Mat-Su Foundation Grants and Awards from                                                                        
     Other Sponsors                                                                                                             
                                                                                                                                
     Additional receipt authority  will enable acceptance of                                                                    
     anticipated  grants  from  the  Mat-Su  Foundation  and                                                                    
     other sponsors. This  amendment provides FY2018 funding                                                                    
     based on a FY2017 supplemental request of $51.2.                                                                           
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair  Gara explained  that the  amendment would  allow                                                                    
the state's  therapeutic court to  accept up to  $400,000 in                                                                    
grant monies from the Mat-Su  Foundation and other sponsors.                                                                    
The  Mat-Su  Foundation's  grant  proposal  was  note  quite                                                                    
$400,000.  The amendment  would  allow the  court system  to                                                                    
seek the  remainder of $400,000  in grant monies  from other                                                                    
sponsors.                                                                                                                       
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment GA 39 was ADOPTED.                                                                          
                                                                                                                                
Vice-Chair  Gara MOVED  to ADOPT  Amendment GA  40 (copy  on                                                                    
file):                                                                                                                          
                                                                                                                                
     Commission on Judicial Conduct                                                                                             
     GA 40 2/15 Correct FY2018 Alaska Care Increase                                                                             
     Correct Alaska Care salary adjustment.                                                                                     
                                                                                                                                
     The   salary   adjustment   included  in   the   FY2018                                                                    
     Governor's  budget  should  have   been  $5.0  for  the                                                                    
     Commission  on  Judicial  Conduct  and  $17.6  for  the                                                                    
     Judicial  Council. This  adjustment  will correct  that                                                                    
     error. A  corresponding $12.6 increase is  reflected in                                                                    
     the Judicial Council component.                                                                                            
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair Gara relayed that  the governor's budget proposal                                                                    
had  2  appropriations  backwards. He  detailed  that  there                                                                    
should  have been  a $5,000  appropriation for  salaries and                                                                    
benefits at the Commission  on Judicial Conduct. However, it                                                                    
was accidentally  appropriated to  the Judicial  Council. In                                                                    
addition,  there should  have been  a $17,600  appropriation                                                                    
for the  Judicial Council but was  accidentally appropriated                                                                    
to the Commission  on Judicial Conduct. Amendment  GA 40 and                                                                    
Amendment GA  42 would reverse the  appropriations and place                                                                    
them in the correct council.                                                                                                    
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment GA 40 was ADOPTED.                                                                          
                                                                                                                                
Vice-Chair  Gara MOVED  to ADOPT  Amendment GA  41 (copy  on                                                                    
file):                                                                                                                          
                                                                                                                                
     Commission on Judicial Conduct                                                                                             
     GA 41 2/15 Personal Service Expenses                                                                                       
                                                                                                                                
     Adjustment to  fully fund personal services.  This is a                                                                    
     new  request for  FY2018. It  was not  included in  the                                                                    
     FY2018 Governor request due to oversight.                                                                                  
                                                                                                                                
     The Commission on Judicial Conduct  is comprised of two                                                                    
     staff   members  -   an  executive   director  and   an                                                                    
     administrative  assistant.  Personal services  comprise                                                                    
     the majority  of the Commission's budget.  This request                                                                    
     is necessary  to fully  fund projected  FY2018 personal                                                                    
     services  expenses.  With  a   two  person  staff,  the                                                                    
     Commission has no capacity to  absorb these costs while                                                                    
     continuing   to   provide   constitutionally   mandated                                                                    
     services.                                                                                                                  
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair  Gara explained  that the  amendment corrected  a                                                                    
mistake   in  communications   between  the   Commission  on                                                                    
Judicial  Conduct  and  the  Office  of  the  Governor.  The                                                                    
Commission on Judicial Conduct  requested $23,800 for salary                                                                    
and   benefits.   The   governor  did   not   transmit   the                                                                    
commission's  request.  In  the  prior  year,  there  was  a                                                                    
similar  number, which  the commission  tried to  absorb but                                                                    
could not  in the  following budget  cycle. Funding  did not                                                                    
move forward  because of the  error. The  amendment proposal                                                                    
came from the Governor's Office.                                                                                                
                                                                                                                                
Representative Wilson asked how it  had been absorbed in the                                                                    
past  and the  reason for  the funding  not being  available                                                                    
currently.  Vice-Chair Gara  responded that  if there  was a                                                                    
complaint  against  a  judge,  the  Commission  on  Judicial                                                                    
Conduct had to hire outside  council to prosecute the case -                                                                    
an ethics  prosecution. Fortunately, the commission  did not                                                                    
have  a prosecution  of this  type  in the  prior year.  The                                                                    
commission  also  constrained  spending where  possible  and                                                                    
backlogged  spending  for  future   years.  The  salary  and                                                                    
benefits were required by statute.  The commission could not                                                                    
continue  to absorb  the cost  and  bank on  there being  no                                                                    
complaints against judges.                                                                                                      
                                                                                                                                
3:05:41 PM                                                                                                                    
                                                                                                                                
Representative  Wilson was  unclear why  funding was  needed                                                                    
when  the  complaints  were filed  with  an  outside  agency                                                                    
rather  than an  internal one.  She did  not understand  the                                                                    
reason for  the increase.  She would  not be  supporting the                                                                    
amendment.                                                                                                                      
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative Wilson OBJECTED.                                                                                                 
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Gara,   Grenn,    Guttenberg,   Kawasaki,   Ortiz,                                                                    
Thompson, Foster, Seaton                                                                                                        
OPPOSED: Pruitt, Tilton, Wilson                                                                                                 
                                                                                                                                
The MOTION PASSED (8/3).                                                                                                        
                                                                                                                                
Amendment GA 41 was ADOPTED.                                                                                                    
                                                                                                                                
Vice-Chair  Gara MOVED  to ADOPT  Amendment GA  42 (copy  on                                                                    
file):                                                                                                                          
                                                                                                                                
     Judicial Council                                                                                                           
     GA 42 2/15 Correct FY2018 Alaska Care Increase                                                                             
                                                                                                                                
     Correct Alaska Care salary adjustment.                                                                                     
                                                                                                                                
     The   salary   adjustment   included  in   the   FY2018                                                                    
     Governor's  budget  should  have  been  $17.6  for  the                                                                    
     Judicial  Council  and  $5.0   for  the  Commission  on                                                                    
     Judicial  Conduct. This  adjustment  will correct  that                                                                    
     error. A corresponding $12.6  reduction is reflected in                                                                    
     the Commission on Judicial Conduct component.                                                                              
                                                                                                                                
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Vice-Chair  Gara  relayed  that the  amendment  corresponded                                                                    
with the mistake he outlined  in GA 40. The Judicial Council                                                                    
and the Commission on Judicial  Conduct were given the wrong                                                                    
amounts of money. The funds  for the Judicial Council should                                                                    
have  been  $17,600 and  the  funds  for the  Commission  on                                                                    
Judicial  Conduct should  have  been  $5,000. The  amendment                                                                    
corrected  the  second  of  the   errors  for  the  Judicial                                                                    
Council.                                                                                                                        
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative  Wilson OBJECTED.  She asked  if the  changes                                                                    
had anything  to do  with step  increases.   Vice-Chair Gara                                                                    
responded  that the  mistakes had  nothing to  do with  step                                                                    
increases.  The  Judicial  Council  and  the  Commission  on                                                                    
Judicial Conduct were granted  the wrong amounts of funding.                                                                    
He repeated the  amounts and remarked that  the numbers were                                                                    
transposed.                                                                                                                     
                                                                                                                                
Representative Wilson WITHDREW her OBJECTION.                                                                                   
                                                                                                                                
There being NO OBJECTION, Amendment GA 42 was ADOPTED.                                                                          
                                                                                                                                
Co-Chair Seaton thanked the subcommittee.                                                                                       
                                                                                                                                
3:08:58 PM                                                                                                                    
                                                                                                                                
Representative Grenn  reviewed the recommendations  from the                                                                    
finance subcommittee of the Department of Law:                                                                                  
                                                                                                                                
     The Chair of the  House Finance Budget Subcommittee for                                                                    
     the Department  of Law submits a  recommended operating                                                                    
     budget  for FY2018  to the  House Finance  Committee as                                                                    
     follows:                                                                                                                   
                                                                                                                                
     Fund Source: (dollars are in thousands)                                                                                    
                                                                                                                                
     Unrestricted General Funds (UGF): $49, 140.4                                                                               
     Designated General Funds (DGF):    $2,867.0                                                                                
     Other Funds:   $31,607.0                                                                                                   
     Federal Funds: $1,489.4                                                                                                    
     Total:    $85,103.8                                                                                                        
                                                                                                                                
     The  Unrestricted General  Fund  (UGF) difference  from                                                                    
     the  FY2015   Management  Plan  to  the   FY2018  House                                                                    
     Subcommittee  budget recommendation  is a  reduction of                                                                    
     $10, 134.9, a 17.1% decrease.                                                                                              
                                                                                                                                
     From  the FY  201 7  Management Plan,  the Subcommittee                                                                    
     recommendation   reflects    a   total    increase   in                                                                    
     Unrestricted General  Funds of  $264.1, a  0.5% percent                                                                    
     increase.                                                                                                                  
                                                                                                                                
Representative Grenn  reported that  he had  recommended two                                                                    
subcommittee  budget  amendments  and one  statutory  change                                                                    
proposal, which he  would be forwarding to the  chair of the                                                                    
House  Judiciary Policy  Committee. Before  he reviewed  the                                                                    
amendment  proposals,  he wanted  to  make  a note  about  a                                                                    
couple of topics not formally submitted to House Finance.                                                                       
                                                                                                                                
Representative  Grenn continued  that  the subcommittee  was                                                                    
supportive  of finding  a way  to pay  for more  prosecutors                                                                    
elsewhere in  the budget to  ensure that the  department had                                                                    
resources  to  prosecute  crimes. The  department  testified                                                                    
that  it was  declining more  and more  viable cases  due to                                                                    
budget  cuts.  The Office  of  Victim's  Rights was  largely                                                                    
affected. However, since the focus  was on the Department of                                                                    
Law,  the  subcommittee  did  not  feel  the  amendment  was                                                                    
appropriate  at present.  Additionally, two  amendments were                                                                    
ruled  out of  order during  the subcommittee  process. They                                                                    
were addressed in the closeout narrative should members of                                                                      
the full finance committee want to look at them in more                                                                         
detail.                                                                                                                         
                                                                                                                                
Co-Chair Seaton asked if there was a statutory amendment.                                                                       
Representative Grenn responded in the affirmative:                                                                              
                                                                                                                                
     Statutory Change Proposals:                                                                                                
                                                                                                                                
     The following  statutory change recommendation  is also                                                                    
     submitted   to   the   House  Finance   Committee   for                                                                    
     consideration:                                                                                                             
                                                                                                                                
     For Consideration by House Judiciary Committee:                                                                            
                                                                                                                                
     Work  over  interim to  do  a  comprehensive reform  of                                                                    
     Child  Protection statutes.  Particular areas  of focus                                                                    
     include, but are not limited to the following:                                                                             
                                                                                                                                
        · Looking to streamline existing statute                                                                                
        · Looking into combining the adjudication and                                                                           
          disposition hearings in Child In Need of Aid                                                                          
          (CINA) proceedings                                                                                                    
       · Allowing a no-contest plea for parents, and                                                                            
        · Creating settlement judges who focus solely on                                                                        
          CINA cases                                                                                                            
                                                                                                                                
Co-Chair Seaton asked Representative Grenn to address his                                                                       
budget amendments.                                                                                                              
                                                                                                                                
Representative Grenn MOVED to ADOPT Amendment H LAW 1 (copy                                                                     
on file):                                                                                                                       
                                                                                                                                
     Civil Division                                                                                                             
     Environmental Law                                                                                                          
     H LAW 1 - Add one  PFT Attorney II and related personal                                                                    
     services to Environmental Law                                                                                              
     Offered by Representative Grenn                                                                                            
                                                                                                                                
     There  are   numerous  cases  outstanding   that  could                                                                    
     provide  significant  revenue  to the  state  that  the                                                                    
     Environmental Law  section does not have  the resources                                                                    
     to  pursue. Adding  an additional  attorney could  help                                                                    
     the Department  achieve significant recoveries  for the                                                                    
     state.                                                                                                                     
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Grenn explained that  the amendment added one                                                                    
Attorney   II  and   related   personal   services  to   the                                                                    
Environmental  Law budget  within  the  Civil Division.  The                                                                    
amendment would  increase the personal services  line in the                                                                    
Civil  Division Environmental  Law  allocation by  $225,000.                                                                    
The position  would be added  to help the  department pursue                                                                    
existing  cases that  could result  in significant  monetary                                                                    
recoveries for  the state. The subcommittee  provided a list                                                                    
of  the  recoveries  the  department  stated  would  not  be                                                                    
pursued with  current resources. The  list would serve  as a                                                                    
reference point  in the following year  to determine whether                                                                    
the position  paid for  itself. He  noted that  the members'                                                                    
packets contained a list member's  packets of the first cost                                                                    
recovery cases.                                                                                                                 
                                                                                                                                
Co-Chair  Seaton  clarified  that Representative  Grenn  was                                                                    
referring to  the "Supporting  Documents H LAW  1 Page  1 of                                                                    
1."                                                                                                                             
                                                                                                                                
Representative Grenn responded affirmatively.                                                                                   
                                                                                                                                
Representative   Wilson   asked    about   the   number   of                                                                    
environmental  attorneys within  the Department  of Law  and                                                                    
the amount  of monies  recuperated thus  far. Representative                                                                    
Grenn deferred to the Department of Law.                                                                                        
                                                                                                                                
BRANDON    CULLUM,    ADMINISTRATIVE   SERVICES    DIRECTOR,                                                                    
DEPARTMENT OF  LAW, responded that the  department currently                                                                    
had 3.5  attorneys the way  the division was staffed  in the                                                                    
environmental  law  section.  He   deferred  to  the  deputy                                                                    
attorney general  to speak to the  missed opportunities with                                                                    
the current staffing level.                                                                                                     
                                                                                                                                
3:14:03 PM                                                                                                                    
                                                                                                                                
JIM  CANTOR, DEPUTY  ATTORNEY  GENERAL,  DEPARTMENT OF  LAW,                                                                    
indicated  that  in   response  to  Representative  Wilson's                                                                    
question he did not have a  figure of revenues brought in by                                                                    
the environmental law group.                                                                                                    
                                                                                                                                
Representative  Wilson remarked  that  it  was difficult  to                                                                    
make a  determination about the financial  benefit of adding                                                                    
an attorney without having a  baseline. She asked Mr. Cantor                                                                    
to  explain the  difference  between joining  a lawsuit  and                                                                    
initiating  one. She  wondered  if the  state  was out  more                                                                    
money  or  time  with  either option.  Mr.  Cantor  believed                                                                    
Representative  Wilson was  looking  at the  portion of  the                                                                    
sheet   that  laid   out  multi-state   anti-trust  recovery                                                                    
potential.  He suggested  that Alaska  had to  establish its                                                                    
damages. For instance, in the  drug world, the damages might                                                                    
be related  to the  Medicare Program overspending  on drugs.                                                                    
He added that in the  multi-state world, a lead state tended                                                                    
to recuperate more than a follower state.                                                                                       
                                                                                                                                
Representative  Wilson asked  about the  11 items  listed at                                                                    
the  bottom of  the  supporting document.  She wondered  how                                                                    
many  of  the  items  were  a result  of  the  past  federal                                                                    
administration's  philosophy compared  to the  new one.  She                                                                    
suggested that there might not  be as many issues to contend                                                                    
with  under the  new  administration.  Mr. Cantor  responded                                                                    
that the list  referred to cost recovery suits  in which the                                                                    
state laid  out money  to clean up  some sort  of pollution.                                                                    
They were state issues rather than national issues.                                                                             
                                                                                                                                
Co-Chair  Seaton  asked  about  the  list  of  lawsuits.  He                                                                    
clarified that the state could  recuperate money from the 11                                                                    
cases listed.  Mr. Cantor responded that  the amounts listed                                                                    
were  monies the  state had  already expended  and would  be                                                                    
cost recoveries from the polluters.                                                                                             
                                                                                                                                
Vice-Chair  Gara   informed  the   committee  that   he  had                                                                    
previously  worked at  the Department  of  Law. He  reported                                                                    
that  cost  recovery  was historically  a  function  of  the                                                                    
department  that brought  in more  money than  it spent.  He                                                                    
offered  that by  understaffing  the  department, the  state                                                                    
ended  up settling  cases for  much less  than the  original                                                                    
amount. Adequate staff  allowed for more of  a full recovery                                                                    
for the state.  He did not believe one year  was enough time                                                                    
to test  whether the additional  staff was effective  due to                                                                    
the  variation in  the  number  of cases  per  year and  the                                                                    
amount of  time they took  to settle. He concluded  that the                                                                    
section was a cost positive portion within the department.                                                                      
                                                                                                                                
Representative Wilson could not  make a statement similar to                                                                    
the one  Vice-Chair Gara made  because the division  did not                                                                    
have the figures she requested.  She would be voting against                                                                    
the amendment. She  agreed that the state  would likely need                                                                    
to  increase  the  funding  if  the  federal  administration                                                                    
remained   the  same.   However,   with   the  new   federal                                                                    
administration  it  looked  as  if it  would  be  more  pro-                                                                    
development.                                                                                                                    
                                                                                                                                
Representative  Pruitt referred  to the  supporting document                                                                    
page  that not  all of  the  expenditures were  barred by  a                                                                    
statute of limitation.  He wondered if any of  the 11 listed                                                                    
were barred by the statute  of limitations. He also wondered                                                                    
about  the urgency  of litigating  presently  as opposed  to                                                                    
later.  Mr. Cantor  answered  that some  of  the list  might                                                                    
include  some   sums  expended  more   than  6   years  ago.                                                                    
Generally, the contamination sites  were an ongoing expense.                                                                    
Some sums would drop off  of what was collectible. The items                                                                    
within  6  years  would  be   obtainable.  He  responded  to                                                                    
Representative  Wilson's question.  In  FY  16, the  section                                                                    
recovered $6,539,000 in state costs and penalties.                                                                              
                                                                                                                                
Co-Chair  Seaton   stated  that   it  was  an   estimate  of                                                                    
$2,000,000 per attorney, per year.                                                                                              
                                                                                                                                
Mr. Cantor responded, "Yep."                                                                                                    
                                                                                                                                
3:20:46 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara  clarified  that   the  cost  recovery  had                                                                    
nothing  to do  with the  US President.  The department  was                                                                    
enforcing  state laws  for contaminated  sites, oil  spills,                                                                    
and  gas  leaks.  The  federal  government  had  no  impact,                                                                    
determination, or  input as to  whether the state  laws were                                                                    
enforced.                                                                                                                       
                                                                                                                                
Representative Grenn  concluded that  the Department  of Law                                                                    
made  some great  points.  He emphasized  that  the list  of                                                                    
recovery cases  was not exhaustive.  He indicated it  was an                                                                    
existing list. He thanked the department for its efforts.                                                                       
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative Wilson OBJECTED.                                                                                                 
                                                                                                                                
Representative Wilson  remarked that  the state had  a spill                                                                    
response fund for  litigating issues similar to  the list of                                                                    
11  cases in  the supporting  document. She  understood that                                                                    
there was $5 million to $7  million sitting in the fund. She                                                                    
wondered why the  spill response fund was not  being used to                                                                    
address the  issue in  the amendment.  Representative Wilson                                                                    
MOVED to  AMEND Amendment  H LAW 1.  She explained  that the                                                                    
money for  the environmental  lawyer would  come out  of the                                                                    
spill response fund rather than from UGF.                                                                                       
                                                                                                                                
Co-Chair Seaton invited the Department of Law to comment.                                                                       
                                                                                                                                
Mr.  Cantor confirmed  that it  was part  of the  process of                                                                    
replenishing the  fund. The recovered dollars  would go into                                                                    
the fund.                                                                                                                       
                                                                                                                                
Representative  Wilson  suggested,  based  on  Mr.  Cantor's                                                                    
reply, that it  would make more sense to pay  from the Spill                                                                    
Prevention Response Fund because  the recovery dollars would                                                                    
be placed there.                                                                                                                
                                                                                                                                
Co-Chair Seaton believed that  the Spill Prevention Response                                                                    
Fund was not a legal  fund for going after recovery dollars.                                                                    
Rather,  it  was a  fund  available  for doing  the  initial                                                                    
cleanup  for  an  incident  until  the  state  could  pursue                                                                    
recovery dollars. He  asked if the department  could use the                                                                    
Spill Prevention  Response Fund to pay  for the department's                                                                    
environmental lawyers.                                                                                                          
                                                                                                                                
Mr.  Cantor   was  aware  that  some   of  the  department's                                                                    
environmental   lawyers  were   funded  with   general  fund                                                                    
dollars.  Others   were  paid  through  the   Department  of                                                                    
Environmental Conservation's budget.                                                                                            
                                                                                                                                
Representative Wilson  was certain that the  money that went                                                                    
into the  fund could be  used for any general  fund purpose.                                                                    
She  believed  the  funding  source  was  a  good  fit.  She                                                                    
wondered  if  it  was  too   late  to  offer  to  amend  the                                                                    
amendment.                                                                                                                      
                                                                                                                                
Co-Chair Seaton responded  that he would allow  for it prior                                                                    
to the wrap  up of each amendment but would  allow it in the                                                                    
present situation.                                                                                                              
                                                                                                                                
Representative Wilson indicated that  she had moved to amend                                                                    
the amendment a  while before and that it was  on the floor.                                                                    
She reiterated  that the funds  for the position  would come                                                                    
out of the  Spill Prevention Response Fund  rather than from                                                                    
UGF.                                                                                                                            
                                                                                                                                
Representative  Grenn  wondered  if all  of  the  recoveries                                                                    
would go  into the recovery  fund or  if they would  go into                                                                    
the  general fund.  Mr. Cantor  explained that,  in general,                                                                    
the  environmental  recoveries  go  into the  470  fund  and                                                                    
reappropriated by  the legislature.  He was sure  there were                                                                    
exceptions.                                                                                                                     
                                                                                                                                
3:27:14 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:30:38 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Representative Grenn WITHDREW AMENDMENT H LAW 1.                                                                                
                                                                                                                                
Co-Chair Seaton  explained that  when adding  something from                                                                    
one department there  had to be a fund  source from another.                                                                    
There had to  be the ability to transfer the  funds back and                                                                    
forth.  He suggested  that the  amendment would  have to  be                                                                    
taken  up in  the second  round of  amendments so  that both                                                                    
funds could  be addressed  at the  same time.  The amendment                                                                    
would be  addressed when both  agency funds were  before the                                                                    
committee together.                                                                                                             
                                                                                                                                
Representative Grenn MOVED to ADOPT  Amendment H LAW 2 (copy                                                                    
on file):                                                                                                                       
                                                                                                                                
     Civil Division                                                                                                             
     Natural Resources                                                                                                          
     H  LAW 2  -  Correction  to a  technical  error in  the                                                                    
     original Governor's operating budget bill.                                                                                 
     Offered by Representative Grenn                                                                                            
                                                                                                                                
     The Office of Management and  Budget submitted a $1.5 m                                                                    
     carryforward  transaction  in  section 1  in  error--it                                                                    
     should  have been  a language  transaction. Legislative                                                                    
     Finance  Division must  match the  Governor's bill,  so                                                                    
     also included the erroneous  section 1 transaction with                                                                    
     a  recommendation  to   reject  the  transaction.  This                                                                    
     amendment  removes   the  erroneous   transaction.  The                                                                    
     committee  needs  to take  no  action  on the  language                                                                    
     transactions.                                                                                                              
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Grenn  read directly from the  amendment [see                                                                    
above].                                                                                                                         
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LAW 2 was ADOPTED.                                                                        
                                                                                                                                
Co-Chair  Seaton  indicated  that  the  committee  would  be                                                                    
taking up amendments for the legislative budget.                                                                                
                                                                                                                                
3:32:39 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:34:04 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  Foster  relayed  that  Co-Chair  Seaton  would  be                                                                    
presenting   the   report   from  the   Legislature   budget                                                                    
subcommittee.                                                                                                                   
                                                                                                                                
Co-Chair   Seaton   noted   that  the   legislature   budget                                                                    
subcommittee  held  4  meetings to  review  the  legislative                                                                    
budget and 12  amendments were brought forward  along with 2                                                                    
statutory change recommendations that  would be forwarded to                                                                    
the Rules Committee for further  review. The first statutory                                                                    
change recommendation  was to repeal  Chapter 19,  SLA 2013,                                                                    
(HB 30:  Performance Reviews).  The second  statutory change                                                                    
was to  repeal the statutes establishing  the Administrative                                                                    
Regulation Review Committee.                                                                                                    
                                                                                                                                
Co-Chair  Seaton continued  that an  amendment was  proposed                                                                    
that  would  have  eliminated funding  for  the  legislative                                                                    
lounge.  The  amendment  did  not  survive  the  committee's                                                                    
advisory  vote.  The Rules  Chair  indicated  she was  still                                                                    
reviewing  the  prices  charged  and  that  there  could  be                                                                    
additional price  increases to  cover more lounge  costs. He                                                                    
planned to  offer an  amendment in the  second round  of the                                                                    
amendment process to  add more general fund  receipts and to                                                                    
reduce  UGF  by  the  same   amount.  He  relayed  that  the                                                                    
reductions  proposed by  the subcommittee  would not  be the                                                                    
only reduction  made to the legislature's  budget. He agreed                                                                    
with his  counterpart in the  Senate to avoid  cutting items                                                                    
in  the other  body's  control. The  other  body would  make                                                                    
those reductions.                                                                                                               
                                                                                                                                
Co-Chair Foster called on Co-Chair  Seaton to begin with his                                                                    
amendments.                                                                                                                     
                                                                                                                                
Co-Chair Seaton  MOVED to ADOPT  Amendment H LEG 1  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Budget and Audit Committee                                                                                                 
     Legislative Audit                                                                                                          
     H LEG 1 - Zero out performance review funding and                                                                          
     delete associated position                                                                                                 
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     Performance reviews conducted under  HB 130 were funded                                                                    
     at a "wind down" level in FY17.                                                                                            
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Seaton   explained  that  the   amendment  deleted                                                                    
$56,000   and   one   permanent  part-time   position   from                                                                    
Legislative Audit.  The FY  17 budget  deleted all  but this                                                                    
small   amount  of   wind-down   funding   for  the   agency                                                                    
performance reviews  under HB 30. One  of the subcommittee's                                                                    
statutory recommendations  was the repeal  of HB 30.  It was                                                                    
not funded in the prior  year and the performance review had                                                                    
not been effective in controlling the budget.                                                                                   
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 1 was ADOPTED.                                                                        
                                                                                                                                
Co-Chair  Seaton  MOVED  to  ADOPT Amendment  H  LEG  2  and                                                                    
H LEG 9 (copies on file):                                                                                                       
                                                                                                                                
     Budget and Audit Committee                                                                                                 
     Legislative Finance                                                                                                        
     H LEG  2 - Technical Correction  Transferring Reduction                                                                    
     for 5-day Furlough from Legislative Operating Budget                                                                       
                                                                                                                                
     Linked to  H LEG 9 -  Technical Correction Transferring                                                                    
     Reduction   for   5-day   Furlough   from   Legislative                                                                    
     Operating Budget TrIn 337675                                                                                               
     Offered by Representative Seaton                                                                                           
     Reductions     associated    with     furloughs    were                                                                    
     inadvertently  allocated to  the legislative  operating                                                                    
     budget  rather   than  to  House  and   Senate  Finance                                                                    
     committees. This amendment corrects that error.                                                                            
                                                                                                                                
     Offsetting amendments--and  supplemental transactions--                                                                    
     are included in the HFC and SFC budgets.                                                                                   
                                                                                                                                
     Senate Finance's portion is  -$26.0 and House Finance's                                                                    
     portion is -$46.8.                                                                                                         
                                                                                                                                
     Legislative Operating Budget                                                                                               
     Legislative Operating Budget                                                                                               
     H LEG  9 - Technical Correction  Transferring Reduction                                                                    
     for 5-day Furlough from Legislative Operating Budget                                                                       
                                                                                                                                
     Linked to  H LEG 2 -  Technical Correction Transferring                                                                    
     Reduction   for   5-day   Furlough   from   Legislative                                                                    
     Operating Budget TrOut 337674                                                                                              
     Offered by Representative Seaton                                                                                           
     Reductions     associated    with     furloughs    were                                                                    
     inadvertently  allocated to  the legislative  operating                                                                    
     budget  rather   than  to  House  and   Senate  Finance                                                                    
     committees. This amendment corrects that error.                                                                            
                                                                                                                                
     Offsetting amendments--and  supplemental transactions--                                                                    
     are included in the HFC and SFC budgets.                                                                                   
                                                                                                                                
     Senate Finance's portion is  -$26.0 and House Finance's                                                                    
     portion is -$46.8.                                                                                                         
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair Seaton highlighted that  the amendments were linked                                                                    
to make  a technical  correction transferring  the reduction                                                                    
of $72,800  UGF for  a 5-day  furlough from  the legislative                                                                    
operating budget  to the  Legislative Finance  Division. The                                                                    
furlough  reductions  were  inadvertently allocated  to  the                                                                    
legislative operating  budget rather  than to the  House and                                                                    
Senate  Finance  Committees.  Amendment  H LEG  2  made  the                                                                    
reduction  to the  Legislative Finance  Division. The  House                                                                    
Finance portion  was $46,800 and the  Senate Finance portion                                                                    
was $26,000.  Amendment H LEG  9 added the $72,000  UGF back                                                                    
to the legislative operating budget.                                                                                            
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being  NO OBJECTION,  Amendment H  LEG 2  and H  LEG 9                                                                    
were ADOPTED.                                                                                                                   
                                                                                                                                
Co-Chair Seaton  MOVED to ADOPT  Amendment H LEG 3  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Budget and Audit Committee                                                                                                 
     Legislative Finance                                                                                                        
     H LEG 3 - Reduce House Finance Committee budget                                                                            
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     Budget reduction to be managed  by the Co-Chairs of the                                                                    
     House Finance Committee.                                                                                                   
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Seaton explained  that the  amendment reduced  the                                                                    
budget  for  the House  Finance  Committee  by $240,000  UGF                                                                    
split  equally  between  the   personnel  services  and  the                                                                    
services  line items.  It was  an overall  reduction of  the                                                                    
committee's budget.                                                                                                             
                                                                                                                                
Representative  Wilson   asked  if  a  position   was  being                                                                    
deleted.  Co-Chair  Seaton   responded  that  the  amendment                                                                    
reduced  the personnel  line  item but  was  not reducing  a                                                                    
position [Co-Chair  Seaton reviewed his paperwork  and asked                                                                    
for a brief at ease].                                                                                                           
                                                                                                                                
3:39:34 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:39:58 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Seaton responded that the  amendment did not reduce                                                                    
positions.                                                                                                                      
                                                                                                                                
Representative  Wilson asked  why  a position  would not  be                                                                    
reduced  along  with  the  fund  reduction.  She  asked  for                                                                    
clarification.  Co-Chair  Seaton  responded that  the  House                                                                    
reduced  staffing ranges  and therefore,  the line  item was                                                                    
being reduced.  He remarked  that there  used to  be several                                                                    
more range 24 personnel. Most of  the savings was due to the                                                                    
range cap of 22.                                                                                                                
                                                                                                                                
Representative Kawasaki  spoke to  the changes  reflected in                                                                    
the  amendment. He  wanted to  confirm that  the savings  of                                                                    
$240,000 was because  salary ranges were capped  at 21 [22],                                                                    
which resulted in lowering salaries  in many cases. Co-Chair                                                                    
Seaton  responded that  it was  a portion  of the  reduction                                                                    
along with some services.                                                                                                       
                                                                                                                                
Representative Pruitt indicated there  was a discussion that                                                                    
all staff  were at  a range  22. He wondered  if any  of the                                                                    
House Finance  employees were being  paid above a  range 22.                                                                    
Co-Chair  Seaton responded  that there  was one  staff being                                                                    
paid at a range 24 in  the House operating budget and one in                                                                    
the House Finance capital budget.                                                                                               
                                                                                                                                
Vice-Chair Gara recollected there  had been some substantial                                                                    
salaries in  the previous  year that  no longer  existed. He                                                                    
continued that  the former chair  of the  Legislative Budget                                                                    
and  Audit Committee  had  highly  compensated staff.  Those                                                                    
positions  had been  deleted. He  reported  that there  were                                                                    
salaries  in the  former majority  leader's  office that  no                                                                    
longer existed. The House had  made the effort to reduce the                                                                    
number of high paid staff.  The decisions that had been made                                                                    
up to  the present  reduced staffing  in areas  of excessive                                                                    
staff  and excessive  pay.  Representative Wilson  responded                                                                    
that  only House  Finance staff  was being  addressed rather                                                                    
than  the  entire  legislature  in  terms  of  the  $240,000                                                                    
savings in the amendment. She asked if she was correct.                                                                         
                                                                                                                                
Co-Chair Seaton responded in the  affirmative. He added that                                                                    
there were front  desk positions in House  Finance that were                                                                    
not  filled,  a   reduction  in  the  number   of  range  24                                                                    
employees, and general salary range  reductions in all House                                                                    
Finance  offices.  He clarified  that  he  was only  talking                                                                    
about House Finance.                                                                                                            
                                                                                                                                
Representative  Wilson  asked  if  the  committee  would  be                                                                    
seeing  other amendments  that addressed  the reductions  in                                                                    
other areas  of the  legislature. Co-Chair  Seaton confirmed                                                                    
that  there  were  a  number  of  other  reductions  in  the                                                                    
amendment packets.                                                                                                              
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 3 was ADOPTED.                                                                        
                                                                                                                                
Co-Chair Seaton WITHDREW Amendment H LEG 4 (copy on file):                                                                      
                                                                                                                                
     Legislative Council                                                                                                        
     Salaries and Allowances                                                                                                    
     H  LEG  4 -  Eliminate  regular  session per  diem  for                                                                    
     Juneau  legislators and  for all  other legislators  by                                                                    
     75%                                                                                                                        
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     This  amendment  would  eliminate regular  session  per                                                                    
     diem expenses for the 3  Juneau legislators who receive                                                                    
     75% of the  federal per diem rate for  living in Juneau                                                                    
     during the session, -$43.1.                                                                                                
                                                                                                                                
     In addition,  the federal per  diem rate for  all other                                                                    
     legislators  is  reduced  by   75%  (from  $213/day  to                                                                    
     $53.25/day), -$819.5.                                                                                                      
                                                                                                                                
     Regular   session  per   diem  is   budgeted  in   this                                                                    
     allocation for a 90-day session.                                                                                           
                                                                                                                                
Co-Chair Seaton  reasoned that  the Legislative  Council had                                                                    
statutory  authority   per  AS  24.10.130c  to   set  policy                                                                    
regarding  legislative per  diem. He  confirmed that  a vote                                                                    
was not taken by the council directing his action.                                                                              
                                                                                                                                
Amendment H LEG 4 was WITHDRAWN.                                                                                                
                                                                                                                                
Co-Chair Seaton  MOVED to ADOPT  Amendment H LEG 5  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Administrative Services                                                                                                    
     H LEG 5 - Reduce personal services expenditures                                                                            
     Offered by Representative Seaton                                                                                           
     Delete $24.7 from Print Shop Section for 1 PPT 4th                                                                         
     Floor copy operator position.                                                                                              
                                                                                                                                
     Delete $55.6 for 1 PFT Administrative Assistant                                                                            
     position in the Executive Director's office and change                                                                     
     to PPT (8 months).                                                                                                         
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair   Seaton  relayed   that   the  amendment   reduced                                                                    
administrative  services  by  $80,300 UGF  in  the  personal                                                                    
services line and deleted  one permanent full-time position.                                                                    
He continued  that $24,700 was  deleted from the  print shop                                                                    
section for one permanent  part-time 4th floor copy operator                                                                    
position  and   $55,600  was  deleted  for   converting  one                                                                    
permanent full-time  administrative assistant position  to a                                                                    
permanent part-time  position for 8 months  in the executive                                                                    
director's office.                                                                                                              
                                                                                                                                
Representative Pruitt  asked if  the copier position  on the                                                                    
4th floor  was presently filled.  He had not seen  anyone at                                                                    
the  desk. He  wondered  if the  position  had already  been                                                                    
eliminated and  the amendment was removing  its funding. Co-                                                                    
Chair Seaton responded that he was correct.                                                                                     
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION                                                                                          
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 5 was ADOPTED.                                                                        
                                                                                                                                
3:47:00 PM                                                                                                                    
                                                                                                                                
Co-Chair Seaton  MOVED to ADOPT  Amendment H LEG 6  (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Legislative Council                                                                                                        
     Council and Subcommittees                                                                                                  
     H  LEG  6 -  Delete  legislative  secretary and  reduce                                                                    
     funding for services and commodities                                                                                       
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     In a memo dated Feb  2, 2017, Legislative Council Chair                                                                    
     Representative   Kito   requested   that,   under   the                                                                    
     Legislative  Council   Chair  Account,   a  legislative                                                                    
     secretary   position  and   a  temporary   position  be                                                                    
     deleted; services be reduced by                                                                                            
     $10.0  (phones): and  commodities be  reduced by  $15.5                                                                    
     (no specific item targeted).                                                                                               
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair   Seaton  detailed   that  the   amendment  deleted                                                                    
$221,200 from the Legislative Council  Chair account and the                                                                    
subcommittee allocation.  The decrement deleted  a permanent                                                                    
full-time  legislative secretary  along with  reductions due                                                                    
to a  reclassification of a  position from  a range 24  to a                                                                    
range  22.  The  amount  also encompassed  a  reduction  for                                                                    
casual labor  and a reduction  for services  and commodities                                                                    
in  the  council  and  subcommittee  allocation.  The  total                                                                    
reduction  of  $221,200  was comprised  of  a  reduction  of                                                                    
$197,500 for  personal services,  $10,000 for  services, and                                                                    
$15,500 for commodities.                                                                                                        
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 6 was ADOPTED.                                                                        
                                                                                                                                
3:48:15 PM                                                                                                                    
                                                                                                                                
Co-Chair Seaton MOVED to ADOPT H LEG 7 (copy on file):                                                                          
                                                                                                                                
     Legislative Council                                                                                                        
     Council and Subcommittees                                                                                                  
     H  LEG  7  -  Reduce  funding  for  the  House  Special                                                                    
     Committee  on Arctic  Policy, Economic  Development and                                                                    
     Tourism                                                                                                                    
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     In  recent  years,  funding to  standing,  special  and                                                                    
     joint committees  has been greatly reduced  and in many                                                                    
     instances eliminated. This amendment reduces the                                                                           
     committee's budget from $27,850 to $10,000.                                                                                
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Seaton indicated  that the  amendment reduced  the                                                                    
budget  for the  House Special  Committee on  Arctic Policy,                                                                    
Economic Development,  and Tourism from $27,850  to $10,000.                                                                    
He  reported  that  in recent  years  funding  to  standing,                                                                    
special, and  joint committees had been  greatly reduced and                                                                    
in many  instances eliminated. The reduction  of $17,850 UGF                                                                    
was taken from the services line item.                                                                                          
                                                                                                                                
Representative Wilson MOVED to AMEND  Amendment H LEG 7. She                                                                    
proposed removing the entire $27,850 allocation.                                                                                
                                                                                                                                
Co-Chair Seaton OBJECTED.  He relayed that it  was deemed by                                                                    
the  subcommittee  that  the reduction  of  $17,850  to  the                                                                    
budget was  acceptable. The subcommittee  left a  balance of                                                                    
$10,000 in the  account to be used at the  discretion of the                                                                    
committee. A  meeting in  Fairbanks was  on the  horizon and                                                                    
other potential  activities. The  speaker and  the committee                                                                    
chairman had  to approve all  travel requests.  He suggested                                                                    
that leaving a balance in  the account sent the message that                                                                    
it  was  important  for  Alaska to  be  involved  in  arctic                                                                    
policy.                                                                                                                         
                                                                                                                                
Representative Wilson remarked  about having removed funding                                                                    
for many  special committees.  She believed  legislators had                                                                    
other  money that  could be  used  for travel.  She did  not                                                                    
believe the reduction would indicate  that Alaska's value of                                                                    
arctic  policy  was  any less.  However,  she  believed  the                                                                    
legislature was sending a message  to Alaskans that whenever                                                                    
reductions were  possible the  legislature would  make them.                                                                    
She reiterated there were other funds available for travel.                                                                     
                                                                                                                                
Representative  Guttenberg sat  on the  state Arctic  Policy                                                                    
Commission.  He thought  zeroing  the account  out sent  the                                                                    
message that  Alaska did  not care.  He believed  Alaska was                                                                    
what  made the  United States  an arctic  nation. The  state                                                                    
could reap large economic gains  being at the right place at                                                                    
the   right   time.   He  emphasized   the   importance   of                                                                    
representing  the  Alaska  at  arctic  policy  meetings.  He                                                                    
thought the  $10,000 was a  small amount of money  to invest                                                                    
in keeping a presence at policy meetings.                                                                                       
                                                                                                                                
Representative  Wilson did  not  think the  amount of  money                                                                    
that the state gave to  something showed intent. She thought                                                                    
the  state's actions  showed intent.  She  believed that  by                                                                    
having a  special committee  that encompassed  arctic policy                                                                    
was  action  enough.  She thought  things  such  as  passing                                                                    
legislation,  avoiding  over-regulation   of  an  area,  and                                                                    
remaining  business friendly  would send  a bigger  message.                                                                    
She opined that by removing  the remainder of the allocation                                                                    
it sent the message that  legislators understood the need to                                                                    
reduce the budget.                                                                                                              
                                                                                                                                
Co-Chair Seaton MAINTAINED his OBJECTION.                                                                                       
                                                                                                                                
A roll call vote was taken  on the MOTION to AMEND Amendment                                                                    
H LEG 7.                                                                                                                        
                                                                                                                                
IN FAVOR: Pruitt, Thompson, Tilton, Wilson                                                                                      
OPPOSED: Grenn,  Guttenberg, Kawasaki, Ortiz,  Gara, Seaton,                                                                    
Foster                                                                                                                          
                                                                                                                                
The MOTION to AMEND Amendment H LEG 7 FAILED (4/7).                                                                             
                                                                                                                                
Vice-Chair  Gara  conveyed  that   in  the  prior  year  the                                                                    
legislature approved $27,850 for  the commission for travel.                                                                    
The chair of  the committee proposed reducing  the amount by                                                                    
about  70  percent.  He  felt   that  given  the  change  in                                                                    
chairmanship a 100 percent reduction would be unreasonable.                                                                     
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 7 was ADOPTED.                                                                        
                                                                                                                                
3:55:16 PM                                                                                                                    
                                                                                                                                
Co-Chair Seaton MOVED to ADOPT Amendment H LEG 8:                                                                               
                                                                                                                                
     Legislative Council                                                                                                        
     Legislature State Facilities Rent                                                                                          
     H LEG 8 - Reduce space in Wrangell and Ketchikan and                                                                       
     reduce lease costs in Barrow                                                                                               
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     The  Governor's  request  transfers $1,499.6  from  the                                                                    
     "other than Anchorage  LIO" facilities rent allocation.                                                                    
     After  that  transfer,  an   increment  of  $153.5  was                                                                    
     included in the Governor's request.                                                                                        
                                                                                                                                
     This  amendment  eliminates  office space  in  Wrangell                                                                    
     ($8.9)  and Ketchikan  ($6.7) for  a  legislator and  a                                                                    
     legislative  staff,  respectively.   The  rest  of  the                                                                    
     reduction  is a  change in  anticipated lease  costs in                                                                    
     Barrow ($27.7)  and elimination of a  small contingency                                                                    
     balance ($15.6).                                                                                                           
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Seaton  elaborated   that  the  amendment  deleted                                                                    
$58,900 UGF from the services  line of the legislature state                                                                    
facilities rent  allocation. The governor's  budget included                                                                    
the transfer  of $1,499,600 from "other  than Anchorage LIO"                                                                    
facilities   rent  allocation.   After  that   transfer,  an                                                                    
increment  of  $153,500  was   included  in  the  governor's                                                                    
budget. Other  cost savings  were identified.  The amendment                                                                    
eliminated office  space in Wrangell ($8,900)  and Ketchikan                                                                    
($6,700)  for   a  legislator   and  a   legislative  staff,                                                                    
respectively.  The rest  of the  reduction was  a change  in                                                                    
anticipated  lease  costs  in  Barrow  of  $27,700  and  the                                                                    
elimination of a small contingency balance of $15,600.                                                                          
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 8 was ADOPTED.                                                                        
                                                                                                                                
3:56:48 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
3:57:09 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Seaton MOVED  to ADOPT Amendment H LEG  10 (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Legislative Operating Budget                                                                                               
     Legislative Operating Budget                                                                                               
     H LEG  10 -  Reduce House  operating budget  Offered by                                                                    
     Representative Seaton                                                                                                      
                                                                                                                                
     Budget reduction  to be managed  by the Speaker  of the                                                                    
     House.                                                                                                                     
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Seaton explained  that the  amendment reduced  the                                                                    
legislative   operating  budget   account   for  the   House                                                                    
operating  budget by  $360,000  UGF.  Personal services  was                                                                    
reduced by  $110,000; travel was reduced  $150,000; services                                                                    
was  reduced   by  $50,000;  and  commodities   was  reduced                                                                    
$50,000.                                                                                                                        
                                                                                                                                
Representative Pruitt asked if  the reduction impacted money                                                                    
being  available  for   special  sessions.  Co-Chair  Seaton                                                                    
confirmed  that the  decrement did  not  reduce funding  for                                                                    
special sessions.                                                                                                               
                                                                                                                                
Representative  Pruitt asked  about  any  employees above  a                                                                    
range 22.  Co-Chair Seaton  believed there  were one  or two                                                                    
employees in leadership receiving higher than a range 22.                                                                       
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 10 was ADOPTED.                                                                       
                                                                                                                                
Co-Chair Seaton MOVED  to ADOPT Amendment H LEG  11 (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Legislative Operating Budget                                                                                               
     Session Expenses                                                                                                           
     H LEG 11 - Reduce expenditures for bill copies and                                                                         
     statutes                                                                                                                   
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     Projected revenue  for subscriptions (copies  of bills,                                                                    
     etc.) was reduced due to  the increased availability of                                                                    
     those  items   electronically  ($2.0);   and  projected                                                                    
     revenue  for statutes  was  reduced, as  it  will be  a                                                                    
     statute supplemental year ($1.5).                                                                                          
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair Seaton  offered that the amendment  reduced session                                                                    
expenses    by   $3,500.    The   projected    revenue   for                                                                    
subscriptions, copies, and bills  was reduced by $2,000 from                                                                    
the  general   fund  program   receipts  due   to  increased                                                                    
availability  of   those  items   electronically.  Projected                                                                    
interagency receipts for statutes  was reduced by $1,500, as                                                                    
it would be a statute supplemental year.                                                                                        
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 11 was ADOPTED.                                                                       
                                                                                                                                
4:00:30 PM                                                                                                                    
                                                                                                                                
Co-Chair Seaton MOVED  to ADOPT Amendment H LEG  12 (copy on                                                                    
file):                                                                                                                          
                                                                                                                                
     Legislative Operating Budget                                                                                               
     Session Expenses                                                                                                           
     H LEG 12 - Reduce personal services expenditures                                                                           
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     This  amendment  reduces  the  FY18  personal  services                                                                    
     budget to more closely  align with actual expenditures.                                                                    
     It is  intended to encourage the  legislature to manage                                                                    
     its own budget more prudently.                                                                                             
                                                                                                                                
     The amount was determined by taking 60% of an expected                                                                     
     $200.0 total reduction, leaving an anticipated total                                                                       
     lapse of approximately $250.0.                                                                                             
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair Seaton  informed the  committee that  the amendment                                                                    
reduced personal services in  the session expense allocation                                                                    
by  $120,000   UGF  to  align   more  closely   with  actual                                                                    
expenditures. It  was intended to encourage  the legislature                                                                    
to  manage its  own budget  more prudently.  The amount  was                                                                    
determined  by taking  60 percent  of  an expected  $200,000                                                                    
total reduction leaving $80,000 for the other body to cut.                                                                      
                                                                                                                                
Representative  Wilson  asked  if   it  was  an  unallocated                                                                    
reduction. Co-Chair Seaton responded  that the reduction was                                                                    
comprised of unused funds from the previous year.                                                                               
                                                                                                                                
Representative Wilson thought it  sounded like the reduction                                                                    
was an  unallocated cut. She  liked the  amendment. However,                                                                    
it  was  her  understanding   that  committee  members  were                                                                    
supposed to find specific allocations for reductions.                                                                           
                                                                                                                                
Co-Chair  Seaton commented  that the  amendment reduced  the                                                                    
personal services  in the session expense  allocation. There                                                                    
had been  three rounds  of having agencies  reduce expenses.                                                                    
The legislature  had not  previously reduced  many expenses.                                                                    
The   amendment  was   representative  of   the  legislature                                                                    
catching up to other agencies in reducing expenses.                                                                             
                                                                                                                                
Representative Wilson agreed with  the reduction. She wanted                                                                    
to clarify  that it was  her understanding that  members had                                                                    
to be very specific  about proposed reductions. She wondered                                                                    
if something would  be coming back from the  other body that                                                                    
was more specific.                                                                                                              
                                                                                                                                
Co-Chair  Seaton  stated that  it  was  a reduction  in  the                                                                    
amount  of  $200,000 to  personal  services  of the  session                                                                    
expense allocation. He conveyed  that $80,000 would be taken                                                                    
from the  Senate's session allocation and  $120,000 would be                                                                    
taken  from  the  House's  session  allocation  in  personal                                                                    
services.  The  legislative   budget  was  being  considered                                                                    
rather  than an  agency budget.  The intention  was for  the                                                                    
legislature to take reductions in its allocations.                                                                              
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H LEG 12 was ADOPTED.                                                                       
                                                                                                                                
Co-Chair   Seaton   commented   that  since   all   of   the                                                                    
subcommittee   recommendations   were   adopted   with   the                                                                    
exception   of  the   withdrawn  Amendment   H  LEG   4  the                                                                    
legislature's budget  would total $64,070,800  UGF; $592,900                                                                    
UGF, $808,300 Other funds for  a grand total of $65,472,000.                                                                    
The  unrestricted general  fund  difference from  the FY  15                                                                    
management  plan to  the  House subcommittee  recommendation                                                                    
was a  reduction of $13,600  or a decrease of  17.5 percent.                                                                    
The unrestricted  fund difference from the  governor's FY 18                                                                    
budget was  a reduction of  $1,150,000 or a decrease  of 1.8                                                                    
percent. He  fully expected the  legislature's budget  to be                                                                    
further reduced in the other body.                                                                                              
                                                                                                                                
Co-Chair Seaton relayed that the  committee would be hearing                                                                    
the Department of Public Safety subcommittee report.                                                                            
                                                                                                                                
4:06:00 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
4:06:53 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  Seaton recognized  Representative Louis  Stutes in                                                                    
the audience.                                                                                                                   
                                                                                                                                
Representative Kawasaki relayed the subcommittee's report:                                                                      
                                                                                                                                
     The House Finance budget subcommittee for the                                                                              
     Department of Public Safety held 4 meetings to discuss                                                                     
     core services  within the Department during  the review                                                                    
     of the FY18 Governor's Amended Budget.                                                                                     
                                                                                                                                
     The Chair of the  House Finance Budget Subcommittee for                                                                    
     the  Department of  Public Safety  recommends that  the                                                                    
     House  Finance  Committee  accept the  Governor's  FY18                                                                    
     budget   with   one   Governor's  amendment   and   two                                                                    
     subcommittee amendments.                                                                                                   
                                                                                                                                
     The  FY18  budget   without  Governor  or  subcommittee                                                                    
     amendment totals:                                                                                                          
                                                                                                                                
     Fund Source: (dollars are in thousands)                                                                                    
                                                                                                                                
     Unrestricted General Funds (UGF): $$154,567.7                                                                              
     Designated general Funds (DGF): $8,851.4                                                                                   
     Other Funds: $15,098.0                                                                                                     
     Federal Funds: $12,138.0                                                                                                   
     Total: $190,655.1                                                                                                          
                                                                                                                                
     The  FY18   budget  with  recommended   Governor's  and                                                                    
     subcommittee amendment totals:                                                                                             
                                                                                                                                
     Fund Source (dollars are in thousands)                                                                                     
                                                                                                                                
     Unrestricted General Funds (UGF): $156,067.7                                                                               
     Designated general Funds (DGF): $8,351.4                                                                                   
     Other Funds: $15,098.0                                                                                                     
     Federal Funds: $12,138.0                                                                                                   
     Total: $191,655.1                                                                                                          
                                                                                                                                
Representative Kawasaki MOVED to ADOPT Amendment H DPS 1                                                                        
(copy on file):                                                                                                                 
                                                                                                                                
     Alaska State Troopers                                                                                                      
     Alaska Bureau of Highway Patrol                                                                                            
     H   DPS   1   -   Reverse   Governor's   Transportation                                                                    
     Maintenance Fund Change                                                                                                    
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     The   proposed  Transportation   Maintenance  Fund   is                                                                    
     intended  for  capital,  operating, or  maintenance  of                                                                    
     highways  and  highway  infrastructure. This  new  fund                                                                    
     source is more appropriately  used in the Department of                                                                    
     Transportation for highway  maintenance rather than DPS                                                                    
     for highway patrol activities.                                                                                             
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Kawasaki MOVED to AMEND  Amendment H DPS 1 to                                                                    
reflect  the actual  amount. The  amendment would  reflect a                                                                    
decrement of $1,519,100 DGF and a total of $1,519,100 UGF.                                                                      
                                                                                                                                
Representative   Wilson   OBJECTED   for  the   purpose   of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Representative Kawasaki  explained that  the purpose  of the                                                                    
motion was to reflect the  actual dollar amounts. During the                                                                    
subcommittee   closeouts,   the   amount  was   rounded   to                                                                    
$1,500,000 after the legislative  fiscal analyst was already                                                                    
too late.  The new total  reflected the amount  requested in                                                                    
the governor's fund source change for $1,519,100.                                                                               
                                                                                                                                
Representative  Wilson MAINTAINED  her OBJECTION.  She spoke                                                                    
to her  objection. She opposed  the notion of  placing money                                                                    
into  a  bill  that  had  not  passed.  The  intent  of  the                                                                    
committee was  to make sure the  funding was not in  DPS. If                                                                    
the funds were  going to be available, they would  be in the                                                                    
Department  of Transportation  and Public  Facilities (DOT).                                                                    
She   noted  there   was  not   a  corresponding   amendment                                                                    
specifying   where  the   transportation   money  would   be                                                                    
allocated.                                                                                                                      
                                                                                                                                
Representative  Kawasaki  clarified  that the  amendment  to                                                                    
amend  H DPS  1 was  speaking to  the underlying  amendment,                                                                    
which was a fund source change of DGF versus UGF.                                                                               
                                                                                                                                
Representative  Wilson  WITHDREW   her  OBJECTION  to  Amend                                                                    
Amendment H DPS 1.                                                                                                              
                                                                                                                                
There being  NO OBJECTION,  Amendment to  Amendment H  DPS 1                                                                    
was ADOPTED.                                                                                                                    
                                                                                                                                
Representative Wilson  commented that  the intention  of the                                                                    
subcommittee was to  use the funds for DOT  rather than DPS.                                                                    
She  was  unclear that  the  funds  were  being put  in  the                                                                    
appropriate place.                                                                                                              
                                                                                                                                
4:12:06 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
4:13:05 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Representative  Kawasaki explained  that  in the  governor's                                                                    
original FY 18 request the  he requested $1,519,100 in order                                                                    
to  stand  up  troopers.  The amount  would  come  from  the                                                                    
transportation maintenance fund - a  fund that did not exist                                                                    
currently. The fund  would be supplied with  dollars from an                                                                    
increase in gas taxes.  The subcommittee and the Legislative                                                                    
Finance Division  thought it was inappropriate  to use funds                                                                    
from  a  future  fund  that  did  not  exist.  Instead,  the                                                                    
subcommittee recommended  using UGF.  He furthered  that the                                                                    
transportation  maintenance  fund  would  be  used  for  its                                                                    
intended purpose, which was to maintain highways.                                                                               
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO  OBJECTION, Amendment H DPS 1  as amended was                                                                    
ADOPTED.                                                                                                                        
                                                                                                                                
Representative  Kawasaki MOVED  to ADOPT  Amendment H  DPS 2                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Village Public Safety Officer Program                                                                                      
     Village Public Safety Officer Program                                                                                      
     H DPS 2 - Prioritization of the VPSO Program                                                                               
     Offered by Representative Kawasaki                                                                                         
                                                                                                                                
     It  is   the  intent   of  the  legislature   that  the                                                                    
     Commissioner  of   the  Department  of   Public  Safety                                                                    
     prioritize  a fully  operational Village  Public Safety                                                                    
     Officer  program  and  expand the  program  to  benefit                                                                    
     additional rural areas.                                                                                                    
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative  Kawasaki  spoke   to  the  amendment,  which                                                                    
contained intent  language and  was offered  by a  member of                                                                    
the subcommittee. He read the intent language [see above].                                                                      
                                                                                                                                
Representative   Kawasaki    reported   that    there   were                                                                    
significant comments about  the fact that a  few short years                                                                    
ago the  state had  well over 100  VPSO positions  that were                                                                    
filled.  Currently,  there  were 53  filled  positions.  The                                                                    
subcommittee  believed  that  in working  with  the  state's                                                                    
grantee  agencies  and  DOT  the   state  could  spread  its                                                                    
resources in  a more efficient and  effective manner. Hence,                                                                    
the subcommittee brought the intent  language forward in the                                                                    
amendment.                                                                                                                      
                                                                                                                                
Representative  Wilson was  concerned the  state was  paying                                                                    
non-profits for 25  positions that were not  filled. She was                                                                    
worried  the state  was not  getting  what it  paid for  and                                                                    
about  recouping costs.  She mentioned  a chart  that showed                                                                    
that the  state was losing  VPSOs faster that they  could be                                                                    
hired. She  thought public  safety would  become more  of an                                                                    
issue if the positions remained  unfilled. She saw the issue                                                                    
as a  much larger  problem. She  suggested that  perhaps the                                                                    
Department of  Commerce, Community and  Economic Development                                                                    
(DCCED)  would  have  to take  over  filling  the  positions                                                                    
because of the VPSO attrition rate.                                                                                             
                                                                                                                                
Representative  Ortiz asked  if Representative  Kawasaki was                                                                    
saying that  in the current  FY 18 budget there  was funding                                                                    
available for  100 VPSO positions  but only 53 of  them were                                                                    
filled. Representative Kawasaki responded  that at one point                                                                    
there had been enough funding  to hire 103 VPSOs. Currently,                                                                    
the  state  was  staffed  at roughly  half  the  amount.  He                                                                    
furthered that  there was enough  funding in the  budget for                                                                    
78 VPSO positions if they  maintained their capacity and the                                                                    
officers could get trained immediately.                                                                                         
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment H DPS 2 was ADOPTED.                                                                        
                                                                                                                                
4:18:01 PM                                                                                                                    
                                                                                                                                
Representative  Kawasaki  MOVED  to ADOPT  Amendment  GA  14                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     Council on Domestic Violence and Sexual Assault                                                                            
     Council on Domestic Violence and Sexual Assault                                                                            
     GA 14 2/15 Omnibus Crime Law and Procedure;                                                                                
     Corrections Ch36 SLA2016 (SB91)                                                                                            
                                                                                                                                
     Implement  reforms identified  by  the Alaska  Criminal                                                                    
     Justice  Commission  to  address  violence  prevention,                                                                    
     services, and  victims' rights. This  is a  new request                                                                    
     for  FY2018.   It  was  not  included   in  the  FY2018                                                                    
     Governor's budget due to oversight.                                                                                        
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative  Kawasaki   explained  that   the  governor's                                                                    
amendment was in  order and submitted by  February 15, 2017.                                                                    
It  increased the  recidivism reduction  DGF per  the fiscal                                                                    
note from SB 91 [Legislation  passed in 2016 - Omnibus Crime                                                                    
Bill]  supporting  the  Council  on  Domestic  Violence  and                                                                    
Sexual  Assault  by  $1,000,000. They  were  recommendations                                                                    
that were  propagated through SB  91 and recommended  by the                                                                    
Alaska   Criminal   Justice   Commission  in   its   Justice                                                                    
Reinvestment  Report.  The  total  amount of  DGF  would  be                                                                    
coming via the Recidivism Reduction  Fund of which there was                                                                    
a  significant  amount  of Marijuana  funds.  They  believed                                                                    
there  would be  sufficient  funds to  cover the  $1,000,000                                                                    
increment.                                                                                                                      
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment GA 14 was ADOPTED.                                                                          
                                                                                                                                
Representative  Kawasaki  also  reported there  had  been  a                                                                    
number of  amendment proposals that were  considered but not                                                                    
forwarded by the subcommittee. The  first was a reduction of                                                                    
the Crime Lab FY 18  UGF allocation in personal services and                                                                    
services by  $2,484,600, a 50 percent  decrease. Members had                                                                    
significant  debate and  discussion about  the crime  lab in                                                                    
light  of   a  report  that   was  recently  filed   by  the                                                                    
Legislative Budget and Audit Committee.  He offered that all                                                                    
members  felt  concerned with  some  of  the discussions  of                                                                    
whether some  of the crime  lab activities could be  done by                                                                    
other agencies, or whether agencies  could help to fund some                                                                    
of the crime lab operations it currently performed.                                                                             
                                                                                                                                
Representative  Kawasaki  relayed  that  there  was  another                                                                    
amendment  dealing with  the  VPSO  grant allocation.  There                                                                    
were significant vacancies, as  each of the grantee agencies                                                                    
had their own difficult  internal conflicts in hiring people                                                                    
for various  areas. A significant  portion of the  money put                                                                    
into the  FY 17 budget  was used for commodities  that might                                                                    
have  been  out  of  the  scope of  the  VPSO  Program.  The                                                                    
committee wanted a higher level  of scrutiny on the issue in                                                                    
the future.                                                                                                                     
                                                                                                                                
Representative Kawasaki  indicated that  there were  2 other                                                                    
reports  from the  subcommittee that  were not  forwarded as                                                                    
amendments.  The first  included the  proposal within  DOR's                                                                    
Criminal  Investigation   Unit  of  9   permanent  full-time                                                                    
investigator  positions  to  be   transferred  to  DPS.  The                                                                    
officers  would be  armed  investigators  that would  handle                                                                    
Permanent Fund Division fraud, child  support fraud, and tax                                                                    
fraud cases. The  discussion needed to be  clarified but the                                                                    
committee was unable to introduce an amendment in time for                                                                      
the closeout of the DOR budget subcommittee.                                                                                    
                                                                                                                                
Co-Chair Seaton thanked the subcommittee for its work.                                                                          
                                                                                                                                
4:22:16 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster provided the subcommittee report:                                                                               
                                                                                                                                
     SUBCOMMITTEE MEETINGS:                                                                                                     
     The   House  Finance   Budget   Subcommittee  for   the                                                                    
     Department  of  Transportation  and  Public  Facilities                                                                    
     held 10 meetings with  the Department of Transportation                                                                    
     and  Public Facilities  during the  review of  the FY18                                                                    
     budget request.                                                                                                            
                                                                                                                                
     RECOMMENDATIONS:                                                                                                           
     The Chair of the  House Finance Budget Subcommittee for                                                                    
     the Department of  Transportation submits a recommended                                                                    
     operating  budget  for  FY2018  to  the  House  Finance                                                                    
     Committee as follows:                                                                                                      
                                                                                                                                
     Fund Source: (dollars are in thousands)                                                                                    
     Unrestricted General Funds (UGF): $145,712.6                                                                               
     Designated General Funds (DGF): $127,113.6                                                                                 
     Other Funds: $311,183.7                                                                                                    
     Federal Funds: $2,045.3                                                                                                    
     Total: $586,055.2                                                                                                          
                                                                                                                                
     The  Unrestricted General  Fund  (UGF) difference  from                                                                    
     the  FY2015   Management  Plan  to  the   FY2018  House                                                                    
     Subcommittee  budget recommendation  is a  reduction of                                                                    
     ($132,8992.0),  a  47.7%   decrease.  The  Subcommittee                                                                    
     recommendation   reflects    a   total    decrease   in                                                                    
     Unrestricted General Funds  of ($72,623,500.5), a 33.3%                                                                    
     reduction from the FY2017 Management Plan                                                                                  
                                                                                                                                
     STATUTORY CHANGE PROPOSALS:                                                                                                
     The  following  statutory  change  recommendations  are                                                                    
     also  submitted  to  the House  Finance  Committee  for                                                                    
     consideration:                                                                                                             
                                                                                                                                
     For Consideration by House Transportation Committee:                                                                       
     The  subcommittee recommends  legislation  to amend  AS                                                                    
     23.40.210  to  replace   Cost  of  Living  Differential                                                                    
     (COLD)    to   the    widely   utilized    Geographical                                                                    
     Differential (GeoDif).                                                                                                     
                                                                                                                                
     Review  all  14  Indirect Expenditures  listed  in  the                                                                    
     Legislative  Finance Division  January  2017 Report  to                                                                    
     evaluate whether  they meet the  purpose and  intent of                                                                    
     the   Legislature   as   defined   throughout   Section                                                                    
     19.65.050.                                                                                                                 
                                                                                                                                
Co-Chair Foster directed members  to turn to the Legislative                                                                    
Finance Division  Transaction Detail  Report. There  were 15                                                                    
amendments. He would  be offering some of  the amendments in                                                                    
a bundle.                                                                                                                       
                                                                                                                                
Co-Chair Foster MOVED to ADOPT the following governor's                                                                         
amendments together GA 15, 17, 19, 21, 23, 25, 27, 29, 31,                                                                      
33, and 35 (copies on file):                                                                                                    
                                                                                                                                
     Administration and Support                                                                                                 
     Northern Region Support Services                                                                                           
     GA  15  2/15  Reverse  Prior  Request:  Delete  Federal                                                                    
     Program Position (25-1224)                                                                                                 
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Administration and Support                                                                                                 
     Program Development and Statewide Planning                                                                                 
     GA  17  2/15  Reverse  Prior  Request:  Delete  Federal                                                                    
     Program  Positions  (25-0216, 25-1351,  25-IN1004,  25-                                                                    
     IN1102)                                                                                                                    
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Statewide Public Facilities                                                                                                
     GA  19  2/15  Reverse  Prior  Request:  Delete  Federal                                                                    
     Program  Positions  (09-0012, 25-0673,  25-IN0949,  25-                                                                    
     N12069)                                                                                                                    
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Statewide Design and Engineering Services                                                                                  
     GA  21 2/15  Reverse  Prior Request:  Delete 6  Federal                                                                    
     Program Positions                                                                                                          
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Harbor Program Development                                                                                                 
     GA  23  2/15  Reverse  Prior  Request:  Delete  Federal                                                                    
     Program Positions (25-0223, 25-0859)                                                                                       
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Central Design and Engineering Services                                                                                    
     GA  25 2/15  Reverse Prior  Request: Delete  26 Federal                                                                    
     Program Positions                                                                                                          
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Northern Design and Engineering Services                                                                                   
     GA  27 2/15  Reverse Prior  Request: Delete  11 Federal                                                                    
     Program Positions                                                                                                          
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Southcoast Design and Engineering Services                                                                                 
     GA  29  2/15  Reverse  Prior  Request:  Delete  Federal                                                                    
     Program Positions  (25-3412, 25-IN1107,  25-IN1117, 25-                                                                    
     IN1118)                                                                                                                    
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Central Region Construction and CIP Support                                                                                
     GA  31  2/15  Reverse  Prior  Request:  Delete  Federal                                                                    
     Program Positions (25-0868, 25-0940, 25-3500)                                                                              
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     Northern Region Construction and CIP Support                                                                               
     GA  33 2/15  Reverse  Prior Request:  Delete 8  Federal                                                                    
     Program Positions                                                                                                          
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
     Design, Engineering and Construction                                                                                       
     South coast Region Construction                                                                                            
     GA  35 2/15  Reverse  Prior Request:  Delete 7  Federal                                                                    
     Program Positions                                                                                                          
                                                                                                                                
     Per General  Government Unit Settlement  Agreement, the                                                                    
     Department is rescinding the  previous request and will                                                                    
     provide a  new change  record containing  more accurate                                                                    
     language as part of the Governor Amended budget.                                                                           
                                                                                                                                
Vice-Chair Gara OBJECTED for discussion.                                                                                        
                                                                                                                                
Co-Chair  Foster communicated  that  all  of the  governor's                                                                    
amendments  rescinded  the  prior  governor's  requests.  It                                                                    
restored  funding  authority and  design-related  positions.                                                                    
The   group  of   amendments  complied   with  the   General                                                                    
Government  Unit Settlement  Agreement.  The department  and                                                                    
his  staff were  available for  questions. He  was aware  of                                                                    
some questions  regarding some contracting out  of positions                                                                    
in design  and engineering. There was  concern about letting                                                                    
the positions leave the state.                                                                                                  
                                                                                                                                
Representative  Pruitt   asked  for  clarification   of  the                                                                    
amendments.  He  wondered  if the  amendments  addressed  77                                                                    
positions.                                                                                                                      
                                                                                                                                
Representative Guttenberg  asked Co-Chair Foster  to re-read                                                                    
the amendment numbers.                                                                                                          
                                                                                                                                
Co-Chair Seaton responded that the  grouping included all of                                                                    
the  governor's amendments  with  the exception  of one.  He                                                                    
referenced Amendments GA 15-35.                                                                                                 
                                                                                                                                
AMANDA  HOLLAND,  ADMIN  SERVICES  DIRECTOR,  DEPARTMENT  OF                                                                    
TRANSPORTATION  AND  PUBLIC  FACILITIES,  replied  that  the                                                                    
amendments had to do with the  76 positions that were in the                                                                    
governor's  proposed  budget   concentrated  in  design  and                                                                    
construction.  The  amendments  reflected  the  department's                                                                    
effort to  optimize its capital program.  The department had                                                                    
been  looking for  ways to  increase  its effectiveness  and                                                                    
efficiency   through  the   previous   several  years.   The                                                                    
department's  proposal  of the  amendments  was  one of  the                                                                    
actions the  department wanted  to take  in order  to reduce                                                                    
the  size of  its footprint  and  to realize  some of  those                                                                    
effectiveness and efficiency measures.                                                                                          
                                                                                                                                
4:27:36 PM                                                                                                                    
                                                                                                                                
Representative Pruitt  referred to  the initial  proposal of                                                                    
the  department  contracting  out its  design  services.  He                                                                    
wondered if the decision to  change course had been based on                                                                    
not having discussed  it with the bargaining  units. If that                                                                    
was the  case, he wondered  if it meant that  the department                                                                    
would not continue  to pursue its original  savings idea. He                                                                    
asked if  the department would  continue to pursue  the idea                                                                    
even though the  department was not currently  ready to move                                                                    
forward with  it. Ms. Holland  answered that  the department                                                                    
would be doing  the activity over the next  couple of years.                                                                    
She relayed  that some of the  state's collective bargaining                                                                    
agreements   required   a   feasibility   study   prior   to                                                                    
contracting out  work that would  otherwise be  completed by                                                                    
people  in filled  positions. If  the filled  positions were                                                                    
being considered  for deletion (not  due to lack  of funding                                                                    
or  work),  the  department  was obligated  to  conduct  the                                                                    
feasibility study first. She reported  there was currently a                                                                    
request   for  proposal   for  a   feasibility  study.   The                                                                    
department anticipated the study  would be done in September                                                                    
2017. It would  help to direct the department  in its future                                                                    
budget decisions regarding capital  programs and a workforce                                                                    
balance of in-house work and contract work.                                                                                     
                                                                                                                                
Representative Pruitt  asked if by removing  the funding, it                                                                    
would  remove  the challenge  of  a  feasibility study.  Ms.                                                                    
Holland answered that the funding  was primarily through the                                                                    
capital  program,   the  department's   capital  improvement                                                                    
program  receipts,  and   federal  funding.  Therefore,  the                                                                    
funding would not be eliminated.                                                                                                
                                                                                                                                
Representative Thompson spoke to  the feasibility study that                                                                    
would be completed by September.  He asked that if the study                                                                    
included the  estimates for how  many federal  dollars would                                                                    
be  spent outside  of Alaska  in Washington  and Oregon.  He                                                                    
asked if  the figures  would be in  the report.  Ms. Holland                                                                    
answered  in  the  affirmative. She  detailed  that  in  the                                                                    
request for proposal the department  asked the consultant to                                                                    
look at  where the federal  funding might shift if  the work                                                                    
was not performed in-house.                                                                                                     
                                                                                                                                
4:30:54 PM                                                                                                                    
                                                                                                                                
Representative Ortiz  asked about Amendment GA  23 regarding                                                                    
harbor program  development. He asked  about the  effects of                                                                    
the  amendment if  adopted. He  also wondered  how it  would                                                                    
impact the capital project process  Ms. Holland spoke about.                                                                    
Ms. Holland  replied that in the  harbor program development                                                                    
component  the department  had some  in-house engineers  who                                                                    
focused solely on the harbor  program. Through the potential                                                                    
change, the department  would look at other ways  to get the                                                                    
work  done   when  it   had  a   need  for   harbor  program                                                                    
development.  It might  be that  the  department would  have                                                                    
other in-house engineers that could  perform the work and it                                                                    
might  mean some  of the  work would  need to  be contracted                                                                    
out.                                                                                                                            
                                                                                                                                
Representative  Ortiz   asked  for  verification   that  the                                                                    
committee  was holding  off on  making  the proposed  change                                                                    
because  of waiting  for  the completion  of  the study.  In                                                                    
other  words,  the  amendment  would  restore  the  proposed                                                                    
$302,000   reduction.   Ms.    Holland   answered   in   the                                                                    
affirmative. The  department had identified 76  positions it                                                                    
could eliminate.  However, the department needed  to conduct                                                                    
a  feasibility study.  The two  positions within  the harbor                                                                    
program  development were  currently  vacant. She  furthered                                                                    
that  most  of the  76  positions  up for  elimination  were                                                                    
vacant.                                                                                                                         
                                                                                                                                
Representative  Guttenberg  asked  to  address  the  current                                                                    
issue  related   to  level   of  performance.   Ms.  Holland                                                                    
mentioned that level of performance  would be built into the                                                                    
feasibility  study.  He  continued that  regardless  of  the                                                                    
contractual obligations  outlined in the  original proposal,                                                                    
he had  had several people  walk him through how  the change                                                                    
would be more  expensive than what was already  in place. He                                                                    
wanted  to ensure  that any  study the  department conducted                                                                    
also  included information  regard the  need for  additional                                                                    
employees  to  manage  contracts  and  overhead.  He  wanted                                                                    
assurance  that the  study would  be  all-inclusive. He  was                                                                    
concerned that if the current  proposal privatized the work,                                                                    
jobs  would   move  outside  of   Alaska.  He   opined  that                                                                    
responding  to  a  change  order  would  require  travel  to                                                                    
Alaska.  He  reemphasized  the  need  for  an  all-inclusive                                                                    
feasibility study.                                                                                                              
                                                                                                                                
4:35:14 PM                                                                                                                    
                                                                                                                                
Representative  Wilson  asked  about the  potential  savings                                                                    
identified by the department. Ms.  Holland answered that the                                                                    
potential savings would  be just over $4  million in capital                                                                    
improvement  program  receipt  authority  in  the  operating                                                                    
budget.  The money  would  still be  in  the capital  budget                                                                    
where the projects were delivered.                                                                                              
                                                                                                                                
Representative  Wilson   asked  if  the  savings   could  be                                                                    
utilized somewhere  else. Ms. Holland  answered it  would be                                                                    
used  in  project work.  The  department  might be  able  to                                                                    
perform  additional  projects  or   would  be  dispersed  to                                                                    
different  capital  projects   approved  through  the  State                                                                    
Transportation Improvement Program.                                                                                             
                                                                                                                                
Representative Wilson understood that  most of the positions                                                                    
were  currently  vacant. She  asked  if  the department  was                                                                    
actively  looking to  hire the  positions. She  wondered how                                                                    
the  department   would  balance  the  issue.   Ms.  Holland                                                                    
answered that the department intended  to keep the positions                                                                    
vacant.  The   governor's  proposed  budget   reflected  the                                                                    
elimination  of  76  positions. In  the  governor's  amended                                                                    
budget, the department had 2  change records for each of the                                                                    
actions:  to  reverse  the elimination  and  to  delete  the                                                                    
positions  with updated  language in  the change  record for                                                                    
clarity.                                                                                                                        
                                                                                                                                
Representative   Wilson  asked   about  the   cost  of   the                                                                    
feasibility  study.  Ms.  Holland  answered  it  would  cost                                                                    
between $400,000 and $600,000                                                                                                   
                                                                                                                                
Representative Thompson asked if  the anticipated savings of                                                                    
about $4 million would be  general fund dollars. Ms. Holland                                                                    
answered the  vast majority  of the  amount was  the capital                                                                    
improvement  program  receipt  which  was  federally  funded                                                                    
capital programs.                                                                                                               
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being  NO OBJECTION, Amendments  GA 15, GA 17,  GA 19,                                                                    
GA 21, GA  23, GA 25, GA 27,  GA 29, GA31, GA 33,  and GA 35                                                                    
were ADOPTED.                                                                                                                   
                                                                                                                                
4:38:44 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
4:38:57 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  Foster   invited  Co-Chair  Seaton  to   move  his                                                                    
amendments.                                                                                                                     
                                                                                                                                
Co-Chair Seaton MOVED to ADOPT Amendments  H DOT 1, H DOT 2,                                                                    
and H DOT 3 (copies on file):                                                                                                   
                                                                                                                                
     Highways, Aviation and Facilities                                                                                          
     Central Region Highways and Aviation                                                                                       
     H DOT  1 - Spread available  Transportation Maintenance                                                                    
     Funds                                                                                                                      
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     Amendments   in  the   Department   of  Public   Safety                                                                    
     eliminate  use of  the Transportation  Maintenance Fund                                                                    
     in the  Alaska Bureau  of Highway Patrol.  The $1,519.1                                                                    
     freed  up by  the  Public Safety  amendments is  spread                                                                    
     prorata  to the  three  regional  highway and  aviation                                                                    
     allocations.                                                                                                               
                                                                                                                                
     Highways, Aviation and Facilities                                                                                          
     Northern Region Highways and Aviation                                                                                      
     H DOT  2 - Spread available  Transportation Maintenance                                                                    
     Funds                                                                                                                      
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     Amendments   in  the   Department   of  Public   Safety                                                                    
     eliminate  use of  the Transportation  Maintenance Fund                                                                    
     in the  Alaska Bureau  of Highway Patrol.  The $1,519.1                                                                    
     freed  up by  the  Public Safety  amendments is  spread                                                                    
     prorata  to the  three  regional  highway and  aviation                                                                    
     allocations.                                                                                                               
                                                                                                                                
     Highways, Aviation and Facilities                                                                                          
     South coast Region Highways and Aviation                                                                                   
     H DOT  3 - Spread available  Transportation Maintenance                                                                    
     Funds                                                                                                                      
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     Amendments   in  the   Department   of  Public   Safety                                                                    
     eliminate  use of  the Transportation  Maintenance Fund                                                                    
     in the  Alaska Bureau  of Highway Patrol.  The $1,519.1                                                                    
     freed  up by  the  Public Safety  amendments is  spread                                                                    
     prorata  to the  three  regional  highway and  aviation                                                                    
     allocations.                                                                                                               
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Seaton  explained   that  the  amendments  removed                                                                    
$1,519,100 in UGF and replaced  them with the same amount of                                                                    
DGF.  An  amendment  in  DPS   eliminated  the  use  of  the                                                                    
transportation  maintenance fund  in  the  Alaska Bureau  of                                                                    
Highway Patrol. He  relayed that the $1,519,100  freed up by                                                                    
the  DPS amendment  was spread  prorated to  the 3  regional                                                                    
highway  and aviation  allocations. The  fund source  change                                                                    
among the 3 regions was as follows:                                                                                             
                                                                                                                                
     Highways, Aviation and Facilities                                                                                          
                                                                                                                                
        · Central Region Highways and Aviation: $471,000                                                                        
          (UGF to DGF)                                                                                                          
                                                                                                                                
        · Northern Region Highways and Aviation: $774,700                                                                       
          (UGF to DGF)                                                                                                          
                                                                                                                                
        · South coast Region Highways and Aviation:                                                                             
          $273,400 (UGF to DGF)                                                                                                 
                                                                                                                                
        · Total: $1,519,100 (UGF to DGF)                                                                                        
                                                                                                                                
Representative Wilson  wondered about  using money  that the                                                                    
state did not have that  was contingent on other legislation                                                                    
passing.  She  provided  a hypothetical  situation  where  a                                                                    
reduced  fuel tax  passed. She  wondered  if the  difference                                                                    
would be prorated from the department's budget.                                                                                 
                                                                                                                                
4:41:55 PM                                                                                                                    
At EASE                                                                                                                         
                                                                                                                                
4:42:24 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Seaton indicated that the  issue was addressed with                                                                    
contingency language  in the  language section,  which would                                                                    
be taken up by the committee the following day.                                                                                 
                                                                                                                                
Representative Wilson requested that  the items be rolled to                                                                    
the  following day.  She was  uncomfortable voting  to place                                                                    
money  that  did not  exist.  She  did  not believe  it  was                                                                    
honest. She noted that in  the governor's budget it appeared                                                                    
that there was a reduction  in UGF. However, in reality, the                                                                    
state would  be counting on  money that was not  earned yet.                                                                    
She wondered  if the language  should accompany  the current                                                                    
amendments.                                                                                                                     
                                                                                                                                
Co-Chair Foster asked for the  opinion of the sponsor of the                                                                    
amendment.                                                                                                                      
                                                                                                                                
Co-Chair Seaton indicated that  the contingency language was                                                                    
already  formatted.  If  the  contingency  language  passed,                                                                    
there would be  no problem. He hoped to  pass the amendment,                                                                    
as the  money was already  built into the budget  in several                                                                    
places. He  indicated he would  be willing to come  back and                                                                    
adjust the language, if necessary.                                                                                              
                                                                                                                                
Representative Wilson  did not  feel that the  committee was                                                                    
addressing things  in the correct  order. She  reported that                                                                    
she would  not be  supporting the amendment.  Presently, the                                                                    
state  did  not  have  the   funding  and  believed  it  was                                                                    
disingenuous to  remove UGF from DOT  until such legislation                                                                    
was passed.  She wanted to  see the  anticipated legislation                                                                    
and its detail before voting on the current amendment.                                                                          
                                                                                                                                
Representative  Thompson  hoped   the  contingency  language                                                                    
would  include the  entire $40  million  expected from  fuel                                                                    
tax. He suggested  that if DOT did not receive  the full $40                                                                    
million the department budget would  be inaccurate and would                                                                    
affect all areas  of the department. He wanted  to make sure                                                                    
the contingency language included  the entire gambit of fuel                                                                    
tax.                                                                                                                            
                                                                                                                                
Co-Chair Seaton believed the language would include the                                                                         
entire gambit.                                                                                                                  
                                                                                                                                
Vice-Chair Gara  had a  point of order.  He did  not believe                                                                    
using the  words dishonest  or disingenuous  was appropriate                                                                    
when  commenting about  the governor.  He  asked members  to                                                                    
refrain from such comments.                                                                                                     
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative Wilson OBJECTED.                                                                                                 
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Ortiz, Gara, Guttenberg, Seaton, Foster, Kawasaki                                                                     
OPPOSED: Pruitt, Thompson, Tilton, Wilson, Grenn                                                                                
                                                                                                                                
The MOTION PASSED (6/5).                                                                                                        
                                                                                                                                
Amendment H DOT 1, Amendment H DOT 2, and Amendment H DOT 3                                                                     
were ADOPTED.                                                                                                                   
                                                                                                                                
4:47:52 PM                                                                                                                    
At EASE                                                                                                                         
                                                                                                                                
4:48:39 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Foster MOVED to ADOPT Amendment GA 37 (copy on                                                                         
file):                                                                                                                          
                                                                                                                                
     Marine Highway System                                                                                                      
     Marine Vessel Operations                                                                                                   
     GA 37 2/15 Alaska Care Rate Increase for Alaska Marine                                                                     
     Highway System Revised Estimate                                                                                            
                                                                                                                                
     Alaska  Marine  Highway  System health  insurance  rate                                                                    
     increase  to   $1,555  per   member  per   month.  This                                                                    
     amendment is  an adjustment from the  previous estimate                                                                    
     submitted in the FY2018 Governor's scenario.                                                                               
                                                                                                                                
     · International Organization of Masters, Mates, and                                                                        
        Pilots (MMP): $32.4                                                                                                     
                                                                                                                                
     · Marine Engineer's Beneficial Association (MEBA):                                                                         
        $57.8                                                                                                                   
                                                                                                                                
     · Inlandboatmen's Union representing the Unlicensed                                                                        
        Marine Unit (IBU): $151.2                                                                                               
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Co-Chair  Foster   reviewed  that   the  amendment   was  an                                                                    
adjustment  to the  Alaska  Marine  Highway System's  health                                                                    
insurance  rate increase.  The increase  would cover  $1,555                                                                    
per member  for collective bargaining units  [see above]. He                                                                    
indicated the department was available for questions.                                                                           
                                                                                                                                
Representative  Grenn  asked  the  department  to  walk  the                                                                    
committee through  the amendment. He wondered  if the amount                                                                    
was  corrected  from  the   estimated  number.  Ms.  Holland                                                                    
responded that  the amount was  a corrected amount  from the                                                                    
governor's proposed budget.                                                                                                     
                                                                                                                                
Representative Grenn  asked if  it happened every  year. Ms.                                                                    
Holland responded that it did not come up regularly.                                                                            
                                                                                                                                
Representative  Wilson  asked  how the  amount  compared  to                                                                    
other state  contracts. She also wondered  when the contract                                                                    
came up for renewal. Ms.  Holland responded that most of the                                                                    
department's  collective bargaining  agreements  were for  3                                                                    
years.  The marine  unions were  currently in  negotiations.                                                                    
Some  renewals  will   be  in  2017.  She   added  that  the                                                                    
negotiated contracts were typically by fiscal year.                                                                             
                                                                                                                                
Representative  Wilson  asked  if  there  would  be  further                                                                    
negotiations or if the state  would end up paying the amount                                                                    
no  matter the  circumstance. Ms.  Holland replied  that the                                                                    
amount had  already been negotiated. She  indicated that the                                                                    
state would  be paying the  amount agreed upon by  the state                                                                    
and the union.                                                                                                                  
                                                                                                                                
Representative Wilson  asked if the money  was actually from                                                                    
FY 17  or FY 18. Ms.  Holland responded that the  amount was                                                                    
what  had already  been negotiated.  She clarified  that the                                                                    
department was negotiating in  2017. However, contracts were                                                                    
through FY 18.                                                                                                                  
                                                                                                                                
Representative  Wilson  did   not  understand  the  $241,000                                                                    
discrepancy.  It was  a significant  amount.  She asked  how                                                                    
many  people were  in the  2 unions.  Ms. Holland  responded                                                                    
that it was approximately 800 employees.                                                                                        
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment GA 37 was ADOPTED.                                                                          
                                                                                                                                
Vice-Chair Gara  asked if could  ask Ms. Holland  a question                                                                    
regarding DOT.                                                                                                                  
                                                                                                                                
Co-Chair Seaton  indicated that  the committee  was finished                                                                    
addressing  the budget  for DOT.  He invited  Representative                                                                    
Guttenberg  to  review  the   subcommittee  report  for  the                                                                    
University Of Alaska (UA).                                                                                                      
                                                                                                                                
4:54:13 PM                                                                                                                    
                                                                                                                                
Representative  Guttenberg  provided  the  report  form  the                                                                    
subcommittee:                                                                                                                   
                                                                                                                                
     SUBCOMMITTEE MEETINGS:                                                                                                     
                                                                                                                                
     The   House  Finance   Budget   Subcommittee  for   the                                                                    
     University  of  Alaska  held  four  meetings  with  the                                                                    
     University  during  our  review   of  the  FY18  budget                                                                    
     request.                                                                                                                   
                                                                                                                                
     RECOMMENDATIONS:                                                                                                           
                                                                                                                                
     The  Chair of  the House  Finance Budget  Sub-Committee                                                                    
     for  the University  of  Alaska  submits a  recommended                                                                    
     operating  budget  for  FY2018  to  the  House  Finance                                                                    
     Committee as follows:                                                                                                      
                                                                                                                                
     Fund Source: (dollars are in thousands)                                                                                    
                                                                                                                                
     Unrestricted General Funds (UGF): $325,033.5                                                                               
     Designated General Funds (DGF): $331,590.4                                                                                 
     Other Funds: $86,640.4                                                                                                     
     Federal Funds: $143,852.7                                                                                                  
     Total:    $887,117.0                                                                                                       
                                                                                                                                
     The  Unrestricted  General  Fund difference  from  FY15                                                                    
     Management Plan to the FY18  Governor Amended budget is                                                                    
     a  reduction  of  $45.6 million,  a  decrease  of  12.3                                                                    
     percent.                                                                                                                   
                                                                                                                                
Representative  Guttenberg  reported  that there  were  some                                                                    
budget amendments discussed in  committee, which he would be                                                                    
introducing.                                                                                                                    
                                                                                                                                
Representative Guttenberg MOVED to ADOPT Amendment GA 38                                                                        
(copy on file):                                                                                                                 
                                                                                                                                
     University of Alaska                                                                                                       
     Budget Reductions/Additions - Systemwide                                                                                   
     GA 38  2/15 Alaska  Technical and  Vocational Education                                                                    
     Formula Funding                                                                                                            
                                                                                                                                
     The Alaska  Technical and Vocational  Education Program                                                                    
     (TVEP), is funded by                                                                                                       
     0.16   percent  of   employee   contributions  to   the                                                                    
     unemployment  insurance trust  fund. The  taxable wages                                                                    
     collected  have declined  more rapidly  than originally                                                                    
     anticipated. A reduction in  TVEP authority is required                                                                    
     in order not to overspend the  fund. This is a new item                                                                    
     for FY2018. It was not  included in the FY2018 Governor                                                                    
     request  due to  timing of  updated revenue  collection                                                                    
     projections.                                                                                                               
                                                                                                                                
     TVEP,  established under  AS  23.15.830, provides  non-                                                                    
     competitive grants  to institutions that are  part of a                                                                    
     statewide  vocational   training  system.  Institutions                                                                    
     provide  technical  and  vocational  training  programs                                                                    
     that align with workforce regional demands.                                                                                
                                                                                                                                
     The  Department  of  Labor  and  Workforce  Development                                                                    
     (DOLWD)  manages  the  TVEP  administration,  including                                                                    
     projecting available revenue for distribution.                                                                             
     DOLWD's  proposal  for  the TVEP  distribution  in  the                                                                    
     FY2018  Governor's  Budget  assumed flat  TVEP  revenue                                                                    
     FY2016  through   FY2018.  There  was   a  carryforward                                                                    
     balance from  unspent prior year TVEP  distributions at                                                                    
     the  end   of  FY2016   that  was  anticipated   to  be                                                                    
     sufficient  to cover  reduced  revenues  in FY2017  and                                                                    
     FY2018.  Actual revenue  collections through  the first                                                                    
     two  quarters  of  FY2017 indicate  taxable  wages  are                                                                    
     declining  faster than  what was  anticipated prior  to                                                                    
     the start of the fiscal  year. An overall adjustment of                                                                    
     $1,319.2 is  needed, bringing  the total  available for                                                                    
     distribution to $11,970.1.                                                                                                 
                                                                                                                                
     The University  of Alaska's distribution  is set  by AS                                                                    
     23.15.835(d), and will  receive $5,386.6, or forty-five                                                                    
     percent,  of total  receipts available.  This decreases                                                                    
     the  University of  Alaska's authority  by $593.5  from                                                                    
     the FY2017 distribution level.                                                                                             
                                                                                                                                
Vice-Chair Gara OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Guttenberg  mentioned that the  amendment had                                                                    
to  do with  the Alaska  Technical and  Vocational Education                                                                    
Program (TVEP)  money. The  amendment reflected  a reduction                                                                    
of $593,500 because  TVEP was not going to  be collecting as                                                                    
much  as  anticipated. The  amount  encompassed  all of  the                                                                    
vocational training programs in  Alaska. Director Pitney had                                                                    
walked  through  the  information  before.  He  thought  the                                                                    
information was self-explanatory.  The amount reflected less                                                                    
money in receipts that would go into the TVEP fund.                                                                             
                                                                                                                                
Vice-Chair Gara WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
There being NO OBJECTION, Amendment GA 38 was ADOPTED.                                                                          
                                                                                                                                
4:57:37 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
4:57:57 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Seaton MOVED  to ADOPT Amendment H UOA 1  and H UOA                                                                    
2 (copies on file):                                                                                                             
                                                                                                                                
     University of Alaska                                                                                                       
     Budget Reductions/Additions - Systemwide                                                                                   
     H UOA 1 - Move $0.6 estimate for UA special license                                                                        
     plates from language to section 1                                                                                          
     Offered by Representative Seaton                                                                                           
     See 30-GH1855J.8, Wallace, 1-31-17.                                                                                        
    This deletes language sec. 16 in HB 57, version J.                                                                          
                                                                                                                                
     Another amendment will add $1.0 to section 1, the                                                                          
     numbers section for University license plate revenue.                                                                      
                                                                                                                                
     University of Alaska                                                                                                       
     Budget Reductions/Additions - Systemwide                                                                                   
     H UOA 2 - UA license plate revenue moved from language                                                                     
     section to section 1                                                                                                       
     Offered by Representative Seaton                                                                                           
                                                                                                                                
     Another  amendment  deletes  language section  16  that                                                                    
     included  an estimate  of $0.6,  in HB  57, version  J.                                                                    
     This  amendment  increases  the amount  to  $1.0  since                                                                    
     amounts in section 1 cannot be estimates.                                                                                  
                                                                                                                                
Representative   Kawasaki  OBJECTED   for  the   purpose  of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Co-Chair Seaton read the amendments [see above}.                                                                                
                                                                                                                                
Representative Kawasaki WITHDREW his OBJECTION.                                                                                 
                                                                                                                                
There being  NO OBJECTION, Amendments  H UOA  1 and H  UOA 2                                                                    
were ADOPTED.                                                                                                                   
                                                                                                                                
4:59:23 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
4:59:32 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Representative Guttenberg  MOVED to ADOPT Amendment  H UOA 3                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     University of Alaska                                                                                                       
     Budget Reductions/Additions - Systemwide                                                                                   
     H UOA 3 - Reduction of Intercollegiate Athletic Teams                                                                      
     to NCAA Minimum                                                                                                            
     Offered by Representative Guttenberg                                                                                       
                                                                                                                                
     It  is   the  intent   of  the  legislature   that  the                                                                    
     University   of    Alaska   reduce   the    number   of                                                                    
     intercollegiate   athletic   teams   at   participating                                                                    
     campuses  to the  minimum required  by the  NCAA Sports                                                                    
     Sponsorship Requirement.                                                                                                   
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative  Guttenberg  read the  amendment  description                                                                    
[see above].                                                                                                                    
                                                                                                                                
Representative Guttenberg  noted that  the president  of the                                                                    
University of Alaska  discuss wanting to revert  to 8, which                                                                    
was  previously allowed.  The  National Collegiate  Athletic                                                                    
Association   told  the   University  it   would  not   give                                                                    
permission to  do so. However,  the NCAA indicated  that the                                                                    
University could  lower its number and  face sanctions after                                                                    
the fact.  He opined  that it  was a  terrible thing  to do.                                                                    
Currently, the University of Fairbanks  (UAF) campus had the                                                                    
minimum number, 10 teams. The  University of Anchorage (UAA)                                                                    
campus had 11 teams. The  intent language requested that the                                                                    
University lower its number of teams to 8.                                                                                      
                                                                                                                                
Representative Wilson relayed that  in the previous year the                                                                    
subcommittee  had   asked  for  an  analysis   on  costs  of                                                                    
individual sports. She asked if  a report had been completed                                                                    
showing  the  costs  to  students  and  to  the  university.                                                                    
Representative Guttenberg  responded that a  spreadsheet had                                                                    
been provided listing the costs  per campus. He did not have                                                                    
the sheet with  him. He relayed that there was  a $4 billion                                                                    
difference between UAA and UAF.                                                                                                 
                                                                                                                                
Representative  Wilson  remarked  that students  were  being                                                                    
charged a  significant amount of  money for sports  in which                                                                    
they might or might not  participate. She was concerned with                                                                    
the  rise in  tuition  costs to  students.  She thought  the                                                                    
amendment  did  not  go  far  enough.  In  terms  of  intent                                                                    
language,  the  legislature had  included  it  in the  past.                                                                    
However,  she  did not  see  any  results from  that  intent                                                                    
language.                                                                                                                       
                                                                                                                                
Representative Ortiz  thought the  issue had  been addressed                                                                    
previously.  He  wondered  if   the  legislature  was  micro                                                                    
managing  the  University regarding  what  it  did with  its                                                                    
funding. He  agreed that not all  students would participate                                                                    
in  sports  activities  but perhaps  having  the  activities                                                                    
would increase  the marketability of the  school, attracting                                                                    
more  enrollment.  He  wondered   if  the  language  in  the                                                                    
amendment allowed  for the legislature  to micro  manage and                                                                    
direct the University to have  certain policies, which might                                                                    
not be in its best interest.                                                                                                    
                                                                                                                                
5:04:35 PM                                                                                                                    
                                                                                                                                
Representative  Guttenberg  reiterated  that  the  amendment                                                                    
reflected  intent language  only. It  was possible  that the                                                                    
University was  contractually obligated  to be at  a certain                                                                    
level.  The intent  was for  the number  to be  reduced. The                                                                    
Board  of Regents  managed the  University  rather than  the                                                                    
legislature.  However,  the  legislature  provided  guidance                                                                    
through intent language. It was merely a request.                                                                               
                                                                                                                                
Representative Pruitt remarked that  a large non-profit, the                                                                    
National   Collegiate  Athletic   Association  (NCAA),   was                                                                    
directing the  legislature how to  spend the  state's money.                                                                    
He  opined  that  the  NCAA  made money  off  the  backs  of                                                                    
students because  of the entity's  mandates. He  wondered if                                                                    
the  intent of  the  amendment was  to  bring the  Anchorage                                                                    
campus  of   the  University  of  Alaska   into  compliance.                                                                    
Representative Guttenberg responded  that the minimum number                                                                    
was 10  teams. He reported  that Anchorage currently  had 11                                                                    
teams. At one time, the  minimum was 8. The University asked                                                                    
NCAA if  it could  return to  a minimum  of 8  teams without                                                                    
sanctions.  However,   the  NCAA  denied   the  University's                                                                    
request.                                                                                                                        
                                                                                                                                
Representative    Pruitt   asked    about   UAF's    number.                                                                    
Representative Guttenberg responded that UAF had 10 teams.                                                                      
                                                                                                                                
Representative Pruitt  asked if  the state  would be  out of                                                                    
compliance with  Title 9 if it  were to lower the  number to                                                                    
8.  Representative Guttenberg  did not  know. He  encouraged                                                                    
the University to reply.                                                                                                        
                                                                                                                                
5:08:23 PM                                                                                                                    
                                                                                                                                
MILES  BAKER, UNIVERSITY  OF  ALASKA,  corrected the  record                                                                    
that Anchorage had  13 teams and UAF had  10 teams depending                                                                    
on  whether indoor  track and  outdoor track  were combined.                                                                    
The University had  looked at the issue in phase  one of its                                                                    
Strategic Pathways process. The  University was currently in                                                                    
phase two.  The University  was balancing  the NCAA  10 team                                                                    
minimum requirement  and the Title 9  requirements for equal                                                                    
opportunity  for  men  and  women.   He  reported  that  the                                                                    
University's  regional  accrediting  body,  Great  Northwest                                                                    
Athletic Conference (GNAC), required  it had men and women's                                                                    
basketball  and cross-country,  and women's  volleyball. The                                                                    
NCAA required  either 5 male teams  and 5 female teams  or 6                                                                    
female teams and 4 male teams  to meet their minimum. It was                                                                    
a  difficult balance  considering  the  University had  less                                                                    
than  400  students  participating   in  those  sports.  The                                                                    
University tried  to resolve the  challenge by  applying for                                                                    
an NCAA  waiver, which was  denied. The  National Collegiate                                                                    
Athletic  Association advised  the  University  to make  its                                                                    
decision  and the  NCAA would  make its  determination after                                                                    
that.  The Board  of Regents  had  set the  issue aside  not                                                                    
wanting to do  anything that would penalize  or sanction the                                                                    
University without knowing the outcome.                                                                                         
                                                                                                                                
Representative  Pruitt asked  if it  was appropriate  to say                                                                    
that in  light of the  restraints of the budget  the regents                                                                    
would  continue to  analyze the  issue. He  asked if  it was                                                                    
necessary for  the legislature to provide  direction. He was                                                                    
hesitant  to  micromanage  the  situation  in  any  way  but                                                                    
thought it  was important to  send a message that  the issue                                                                    
needed  to  be  addressed.  Mr.  Baker  responded  that  the                                                                    
regents were  continuing to examine  and address  the issue.                                                                    
He relayed that  private giving played a larger  part in the                                                                    
support of  the University's  sports teams. He  recognized a                                                                    
huge up swell of support  from the community when the skiing                                                                    
teams were being considered for elimination.                                                                                    
                                                                                                                                
Vice-Chair Gara  wanted to confirm  that the  University was                                                                    
looking into the situation. Mr. Baker responded, "Yes."                                                                         
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative  Ortiz  requested  an   "at  ease"  prior  to                                                                    
voting.                                                                                                                         
                                                                                                                                
5:13:30 PM                                                                                                                    
At EASE                                                                                                                         
                                                                                                                                
6:14:21 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  Seaton reminded  everyone that  the committee  was                                                                    
addressing Amendment H UOA 3.                                                                                                   
                                                                                                                                
Vice-Chair Gara  was hoping for additional  time to consider                                                                    
the amendment.  He was  not certain  the message  being sent                                                                    
with the amendment would be  taken by the University the way                                                                    
the committee intended. He had some concerns.                                                                                   
                                                                                                                                
Representative Guttenberg  reported having  attended several                                                                    
university and  community meetings where people  came out of                                                                    
the  woodwork to  support  various  athletic activities.  He                                                                    
believed  sports and  other  activities  were a  significant                                                                    
part of  education. The  purpose of  the intent  language in                                                                    
the  amendment was  to  provide the  Board  of Regents  some                                                                    
guidance  to move  forward with  a  better idea  of what  it                                                                    
should do. He opined that  there was a significant amount of                                                                    
pressure  for   the  University   to  focus  only   on  core                                                                    
functions.  Although   the  University  was  not   going  to                                                                    
eliminate sports  or go  below the minimum  set by  NCAA, it                                                                    
should reach the minimum point.                                                                                                 
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative Pruitt OBJECTED.                                                                                                 
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Guttenberg,  Kawasaki,  Thompson, Wilson,  Foster,                                                                    
Seaton                                                                                                                          
OPPOSED: Gara, Grenn, Ortiz, Pruitt, Tilton                                                                                     
                                                                                                                                
The MOTION PASSED (6/5).                                                                                                        
                                                                                                                                
Amendment H UOA 3 was ADOPTED.                                                                                                  
                                                                                                                                
Representative Guttenberg  MOVED to ADOPT Amendment  H UOA 4                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     University of Alaska                                                                                                       
     Budget Reductions/Additions - Systemwide                                                                                   
     H  UOA  4  -  Priority  of  Cuts  or  Reallocations  of                                                                    
     Unrestricted General Funds                                                                                                 
     Offered by Representative Guttenberg                                                                                       
                                                                                                                                
     It  is  the intent  of  the  legislature that  cuts  or                                                                    
     reallocations  of  unrestricted  general funds  to  the                                                                    
     University  of Alaska  Anchorage, University  of Alaska                                                                    
     Fairbanks  and University  of  Alaska  Southeast, on  a                                                                    
     percentage basis,  not exceed cuts or  reallocations of                                                                    
     unrestricted general funds to  the University of Alaska                                                                    
     Statewide Administration                                                                                                   
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative  Guttenberg asked  members  to consider  that                                                                    
there  were  4  allocations within  the  university  system:                                                                    
University of  Alaska Anchorage (UAA), University  of Alaska                                                                    
Fairbanks (UAF),  University of Alaska Southeast  (UAS), and                                                                    
University of  Alaska statewide. None of  the three campuses                                                                    
would be reduced at a  greater percentage than statewide. He                                                                    
noted  a significant  amount of  concern  about keeping  the                                                                    
focus  of  the  university  on the  core  functions  of  the                                                                    
campuses.  The amendment  simply  stated  that the  academic                                                                    
campuses   were    no   less   important    than   statewide                                                                    
administration.                                                                                                                 
                                                                                                                                
6:19:47 PM                                                                                                                    
                                                                                                                                
Representative   Pruitt  appreciated   the  intent   of  the                                                                    
amendment. However,  the challenge was that  the majority of                                                                    
statewide reductions had been  decided. The board would have                                                                    
to  start looking  for reductions  at the  individual campus                                                                    
level. He  believed that University  would have  to consider                                                                    
program deletions  or consolidations. The  statewide portion                                                                    
of  the  University's budget  had  already  been reduced  by                                                                    
about 40 percent. He thought  the amendment would hinder the                                                                    
Board of  Regents' ability  to make  the best  decisions for                                                                    
the  university  system.  He was  hesitant  to  support  the                                                                    
amendment.                                                                                                                      
                                                                                                                                
Representative  Kawasaki asked  about  the  language of  the                                                                    
amendment. The current language directed  cuts to be made at                                                                    
the 3 campuses.  He wondered if the  reduction was aggregate                                                                    
or at  each campus. If  the statewide administration  was to                                                                    
adopt  a  shared  services  model,  he  wondered  if  campus                                                                    
activities would  be hindered. He noted  that the University                                                                    
had  discussed  centralizing   human  resources  within  the                                                                    
statewide administration.  He also wanted to  know about the                                                                    
amendment's impact  to the  current activities  of Strategic                                                                    
Pathways.  Representative  Guttenberg   explained  that  the                                                                    
intent  was that  each campus  would be  treated and  funded                                                                    
separately.  The  funding  was  based  on  a  percentage  of                                                                    
general  funds. He  provided an  example of  shared services                                                                    
allocated by campus. It would  allow the Board of Regents to                                                                    
have more options to manage the University as needed.                                                                           
                                                                                                                                
6:24:26 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara  completely  supported  the  amendment.  He                                                                    
interpreted  the  amendment  to  say  that  the  only  place                                                                    
potentially  left   to  cut   would  be   in  administrative                                                                    
services.  A student  could  no longer  obtain  a degree  in                                                                    
chemistry  at  the  Anchorage  campus.  The  University  was                                                                    
losing professors  who brought  in grant monies.  He thought                                                                    
the  amendment directed  the University  to look  at cutting                                                                    
administration costs first. He  continued that reductions to                                                                    
the main campuses  could not be greater  than the percentage                                                                    
of  cuts to  the University's  administrative costs.  He did                                                                    
not believe there  was a significant amount of  waste in the                                                                    
University's  budget having  reduced it  by $50  million. He                                                                    
asserted that  the University would  need to  decide whether                                                                    
it  needed  highly  paid chancellors  at  every  campus.  He                                                                    
reemphasized his support of the amendment.                                                                                      
                                                                                                                                
Representative Thompson wanted to  ask the administration to                                                                    
speak to the potential effects  of the amendment. He queried                                                                    
whether  the University  had  been cut  by  40 percent.  Mr.                                                                    
Baker responded that  system wide reductions were  two and a                                                                    
half  times what  they had  been  at the  campus level.  The                                                                    
campuses had been  cut roughly 14 percent  over the previous                                                                    
3  years.  He  confirmed   that  statewide  reductions  were                                                                    
approaching  40 percent.  The statewide  general funds  were                                                                    
down to  about $20 million. There  were administrative costs                                                                    
at the statewide  level and at each campus.  Each campus had                                                                    
administrative  costs.  President  Johnson  stated  that  he                                                                    
wanted to  see anything that touched  students and academics                                                                    
delivered at  the campus level.  President Johnson  was also                                                                    
pursuing  statewide efficiencies  that could  be implemented                                                                    
holistically. He  listed several system wide  areas that the                                                                    
University was evaluating.                                                                                                      
                                                                                                                                
6:28:00 PM                                                                                                                    
                                                                                                                                
Representative  Thompson was  not  clear  about Mr.  Baker's                                                                    
answer.                                                                                                                         
                                                                                                                                
Co-Chair  Seaton wondered  if the  University supported  the                                                                    
amendment. Mr. Baker replied that  the University could work                                                                    
with  the  will   of  the  committee.  He   added  that  the                                                                    
University  was  half  way through  the  Strategic  Pathways                                                                    
process. Over the previous 3  years, the University had been                                                                    
managing the cuts by incrementally  passing them down to the                                                                    
statewide  level  and  to the  campuses.  He  conveyed  that                                                                    
making additional  reductions would be very  difficult to do                                                                    
evenly and systematically across  the system. The University                                                                    
would have  to look at  reducing programs and  services that                                                                    
it could no longer afford  to offer. The reductions could be                                                                    
disproportionate  per  campus  depending on  where  programs                                                                    
were offered. Part of the  Strategic Pathways process was to                                                                    
identify   areas  in   which  the   University  could   gain                                                                    
efficiencies by pulling them into a centralized location.                                                                       
                                                                                                                                
6:30:02 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara  wondered   about  the  difference  between                                                                    
administration   at   the   main  campuses   and   statewide                                                                    
administration.  Mr.  Baker  responded that  internally  the                                                                    
University  referred  to  statewide  administration  as  the                                                                    
statewide group managing the entire  system. Each campus had                                                                    
a chancellor,  deans, provosts, and an  administration group                                                                    
managing  administrative services.  He  reported that  there                                                                    
was  an  administrative function  at  each  of the  campuses                                                                    
managed by the chancellor of each campus.                                                                                       
                                                                                                                                
Vice-Chair Gara thought  Representative Guttenberg wanted to                                                                    
see reductions  in administrative  costs before cuts  to the                                                                    
core  of  the campuses.  He  did  not  realize there  was  a                                                                    
difference    between     statewide    administration    and                                                                    
administration. He  asked if it  would be helpful  to remove                                                                    
the  word  "statewide." He  asked  for  feedback. Mr.  Baker                                                                    
supported  the   focus  of  preserving   the  core   of  the                                                                    
University.                                                                                                                     
                                                                                                                                
Representative  Wilson  asked  about the  category  for  the                                                                    
maintenance  of buildings.  She  wondered if  it would  fall                                                                    
under statewide administration. She  asked for clarity about                                                                    
administration. Mr. Baker responded  that the University had                                                                    
a  facilities  and  land  office,   part  of  the  statewide                                                                    
administration   that  owned   and   managed   all  of   the                                                                    
University's   facilities.  In   terms  of   the  day-to-day                                                                    
operations, the management of the  facilities at each campus                                                                    
was administrated by their respective campus.                                                                                   
                                                                                                                                
Representative Wilson reported that  the University had over                                                                    
400 buildings.  She did not  believe it was possible  for UA                                                                    
to  continue with  the maintenance  and  ownership of  those                                                                    
facilities. She  completely agreed  with the  amendment. She                                                                    
reported her  concern about some campuses  closing and asked                                                                    
if a  closure would  fall under statewide  administration or                                                                    
one of  the campuses.  Mr. Baker answered  that some  of the                                                                    
decision-making would  be directed to the  Board of Regents.                                                                    
He  reported  that  presently the  rural  campuses  and  the                                                                    
function of  the rural campuses  were being studied  as part                                                                    
of  the second  phase  of Strategic  Pathways. He  indicated                                                                    
there was a  draft of a new facilities  land management plan                                                                    
that  would be  brought to  the  regents at  the next  board                                                                    
meeting. The  level of  scrutiny of  the rural  campuses was                                                                    
happening at  the system wide  level. A  determination about                                                                    
how the  University was managing its  facilities and whether                                                                    
it had too many facilities was in progress.                                                                                     
                                                                                                                                
Representative Wilson asked if  the sponsor of the amendment                                                                    
was bundling the  three campuses together or if  he just did                                                                    
not  want any  one of  the  campuses reduced  more than  the                                                                    
statewide administration. She asked  if she was correct. Mr.                                                                    
Baker responded in the affirmative.                                                                                             
                                                                                                                                
Representative Wilson was very supportive of the amendment.                                                                     
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative   Pruitt  OBJECTED.   He   agreed  with   the                                                                    
direction of the amendment. However,  he did not know if the                                                                    
language really  worked well. He  thought it would  be worth                                                                    
revisiting the language.                                                                                                        
                                                                                                                                
Representative Pruitt WITHDREW his OBJECTION.                                                                                   
                                                                                                                                
There being NO OBJECTION, Amendment H UOA 4 was ADOPTED.                                                                        
                                                                                                                                
Representative Guttenberg  MOVED to ADOPT Amendment  H UOA 5                                                                    
(copy on file):                                                                                                                 
                                                                                                                                
     University of Alaska                                                                                                       
     Budget Reductions/Additions - System wide                                                                                  
     H UOA 5 - Establishing a UGF Spending Level for                                                                            
     Intercollegiate Athletics                                                                                                  
     Offered by Representative Guttenberg                                                                                       
                                                                                                                                
     It  is   the  intent   of  the  legislature   that  the                                                                    
     University of Alaska  fund intercollegiate athletics at                                                                    
     both  the  University  of   Alaska  Anchorage  and  the                                                                    
     University of Alaska Fairbanks at  the current level of                                                                    
     University   of    Alaska   Fairbanks   intercollegiate                                                                    
     athletics unrestricted general fund spending.                                                                              
                                                                                                                                
Co-Chair Foster OBJECTED for the purpose of discussion.                                                                         
                                                                                                                                
Representative Guttenberg read the amendment [see above].                                                                       
                                                                                                                                
Representative Guttenberg reported  discovering a $3 million                                                                    
difference  between  the  costs of  administration  for  UAA                                                                    
versus  UAF. The  monies for  administrative costs  were not                                                                    
applied to  keep the Alaska  Airlines facility open,  or any                                                                    
buildings.  Rather,  it  was  just  for  athletics.  He  has                                                                    
discussed the  funding issue with the  athletic directors of                                                                    
UAA and  UAF and  about bringing sports  in line  by raising                                                                    
money  through  sponsorship,  boosters,   and  the  sale  of                                                                    
memorabilia or other items.                                                                                                     
                                                                                                                                
6:39:48 PM                                                                                                                    
                                                                                                                                
Representative  Kawasaki was  unsure how  much general  fund                                                                    
dollars UAA  spent versus UAF on  intercollegiate athletics.                                                                    
As stated earlier, there were 13  NCAA teams at UAA and only                                                                    
10 at UAF. He was  having trouble understanding whether they                                                                    
were  comparable types  of  teams or  sports.  He asked  for                                                                    
clarity and  expressed his concern  about wanting  to define                                                                    
giving an equal amount between UAA and UAF.                                                                                     
                                                                                                                                
Representative Pruitt  highlighted that there were  twice as                                                                    
many students  at UAA as UAF.  He did not think  it was wise                                                                    
to assign  the same amount to  each of the campuses.  He was                                                                    
not sure  if the intent  of the  amendment would be  met. He                                                                    
was  concerned because  of the  disparity in  the number  of                                                                    
students at each of the campuses.                                                                                               
                                                                                                                                
Representative Wilson remarked that  there were not twice as                                                                    
many teams  from one  campus to  the other  and UAS  did not                                                                    
have any.  She thought that  because of the  prior amendment                                                                    
each   campus  would   have  about   the   same  number   of                                                                    
participants.  She  expressed  her frustration  because  she                                                                    
thought  it was  more  important to  discuss the  graduation                                                                    
rate.  Although sports  were important,  she  opined it  was                                                                    
more important  to discuss how  students would  be affected.                                                                    
She spoke about  the high costs associated  with tuition and                                                                    
the fact that  students typically got loans.  She thought it                                                                    
was unfair that students that  did not participate in sports                                                                    
ended up  paying for  them. She  thought education  was more                                                                    
important  than   sports.  She   was  concerned   about  the                                                                    
University having  to meet the  10-team minimum  required by                                                                    
the NCAA  because of  costs. It  was her  understanding that                                                                    
some   teams  came   together  to   specifically  meet   the                                                                    
requirement.  She  thought  the   amendment  sent  a  strong                                                                    
message that  the University  had to  quit doing  things the                                                                    
way  it  had  been  doing them  because  students  ended  up                                                                    
paying. She was in support of the amendment.                                                                                    
                                                                                                                                
Co-Chair Seaton was  concerned with some of  the language in                                                                    
the  amendment.  He read  a  portion  of the  amendment.  He                                                                    
thought it sent  a bad message and a  different message than                                                                    
the  legislature  had  sent in  the  past.  Previously,  the                                                                    
legislature had  stated that the University  should fund its                                                                    
core services.  The regents had not  defined intercollegiate                                                                    
athletics as a core service. The  regents had come in with a                                                                    
budget  request   of  about  $16   million  more   than  the                                                                    
governor's  budget.  The   regents  identified  needing  $16                                                                    
million  more  for  its budget.  The  University  spent  $13                                                                    
million  on intercollegiate  athletics.  The state  provided                                                                    
the  University $15,000  to each  team to  fly to  Alaska to                                                                    
compete. He spoke to placing  mandatory fees on students not                                                                    
involved  in intercollegiate  athletics. He  wanted to  make                                                                    
sure  the  amendment  was  not  interpreted  as  saying  the                                                                    
University  of Alaska  funded intercollegiate  athletics. He                                                                    
wanted to offer a friendly amendment to the amendment.                                                                          
                                                                                                                                
Co-Chair  Seaton  MOVED  to  AMEND Amendment  H  UOA  5.  He                                                                    
recommended following  "It is the intent  of the legislature                                                                    
that"  inserting,   "if  the  University  of   Alaska  Funds                                                                    
intercollegiate athletics at  University of Alaska Anchorage                                                                    
and at the University of  Alaska Fairbanks, the regents fund                                                                    
at  no more  than the  current levels  of the  University of                                                                    
Alaska Fairbanks."  He wanted to  make sure  the legislature                                                                    
was not telling  the University that it expected  it to fund                                                                    
intercollegiate   athletics   over  chemistry,   philosophy,                                                                    
Arctic Studies, or anything else.                                                                                               
                                                                                                                                
Representative  Thompson  OBJECTED.   He  thought  the  word                                                                    
"current" should  be removed  because it  did not  leave any                                                                    
room  to  make  reductions   if  necessary.  Presently,  the                                                                    
University had  a disparity in  the amount of  general funds                                                                    
to the two athletic  departments. The athletic department at                                                                    
UAA  was  allocated  $6,459,000  versus  $2,810,000  to  the                                                                    
athletic department  at UAF. He  also noted a  difference of                                                                    
about  $3  million  in  the   administrative  costs  of  the                                                                    
athletic departments.  He liked Co-Chair  Seaton's amendment                                                                    
to  the amendment  but suggested  the deletion  of the  word                                                                    
"current."  It   did  not  leave  flexibility   in  case  of                                                                    
reductions.                                                                                                                     
                                                                                                                                
Representative Thompson WITHDREW his  OBJECTION to amend the                                                                    
amendment.                                                                                                                      
                                                                                                                                
There being NO  OBJECTION, the amendment to  Amendment H UOA                                                                    
5 was ADOPTED.                                                                                                                  
                                                                                                                                
Representative Thompson  MOVED to AMEND Amended  Amendment H                                                                    
UOA 5.  He explained  that his amendment  was to  remove the                                                                    
word "current."                                                                                                                 
                                                                                                                                
There being NO OBJECTION, the amendment to Amendment H UOA                                                                      
5 as amended was ADOPTED.                                                                                                       
                                                                                                                                
Representative  Ortiz voiced  his concern  about potentially                                                                    
micromanaging  the  University.   Although  the  legislature                                                                    
appropriated  funding,  the  regents  were  responsible  for                                                                    
making  the decisions  for the  University.  He assumed  the                                                                    
board  made  its  decisions  in the  best  interest  of  the                                                                    
University.  High  schools  spent a  significant  amount  of                                                                    
money  on  sports  activities  to fly  teams  in  and  other                                                                    
things. Those  decisions were made despite  school districts                                                                    
knowing  they  were  dealing  with  fiscal  constraints.  He                                                                    
thought   the  decisions   around  funding   intercollegiate                                                                    
activities should  be left to  the Board of Regents.  He did                                                                    
not understand the purpose of  the direction the legislature                                                                    
was trying to provide.                                                                                                          
                                                                                                                                
Representative Pruitt spoke to  the amendment as amended. He                                                                    
thought  the discussion  the  committee  was having  sounded                                                                    
like old people  talking about what young  adults wanted. He                                                                    
thought members were out of  touch. He expounded that campus                                                                    
life was  a key  component for young  people in  deciding to                                                                    
attend  a  certain  university.  He  had  heard  from  young                                                                    
constituents that  had been  offered full  scholarships that                                                                    
they would  not be  accepting them.  He queried  the reason.                                                                    
Their response was that the  UA campuses did not have campus                                                                    
life.  Even  though  Alaska  might  have  all  of  the  best                                                                    
programs in  the world, without  a college  experience young                                                                    
adults would not be interested  the University of Alaska. He                                                                    
opined that  sending the message that  Alaska thought sports                                                                    
or other  activities were  frivolous was  a poor  message to                                                                    
send  to  young adults.  If  students  chose not  to  attend                                                                    
college  in Alaska,  there was  a risk  that they  would not                                                                    
come back  to the  state at  all. He  thought a  balance was                                                                    
needed. He was not arguing  against the state addressing the                                                                    
cost  of  sports  activities.  He   would  be  opposing  the                                                                    
amendment.                                                                                                                      
                                                                                                                                
6:54:11 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Gara   did  not   believe  an   intent  language                                                                    
amendment was  a good idea.  He did  not know how  to assign                                                                    
value  to  the different  sports  teams.  He believed  in  a                                                                    
vibrant  university  and  reported having  opposed  previous                                                                    
cuts to the  University. He could not  support the amendment                                                                    
language.                                                                                                                       
                                                                                                                                
Representative  Guttenberg loved  the  University. He  drove                                                                    
through  the  campus  to  get   to  town  by  the  statewide                                                                    
administration  building twice  daily. It  was an  important                                                                    
part of his  district, the community, and the  state. He had                                                                    
chosen the lower number of  the two campuses clarifying that                                                                    
he was not choosing one campus over another.                                                                                    
                                                                                                                                
Representative  Guttenberg relayed  that  the University  of                                                                    
Alaska   Fairbanks   engineering   team   won   a   national                                                                    
engineering   competition.   They   beat   5   other   major                                                                    
universities.  The announcement  was made  in the  Fairbanks                                                                    
New Miner. He pointed out  that the amendment was seeking to                                                                    
establish a  baseline. He suggested there  were several ways                                                                    
to make money. The amendment reflect intent language only.                                                                      
                                                                                                                                
Co-Chair Foster WITHDREW his OBJECTION.                                                                                         
                                                                                                                                
Representative Pruitt OBJECTED.                                                                                                 
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR: Thompson, Tilton, Wilson, Guttenberg                                                                                  
OPPOSED:  Ortiz,  Pruitt,  Gara,  Grenn,  Kawasaki,  Foster,                                                                    
Seaton                                                                                                                          
                                                                                                                                
The MOTION to adopt H UOA 5 as amended FAILED (4/7).                                                                            
                                                                                                                                
Representative  Guttenberg  reported that  the  subcommittee                                                                    
had   one  amendment   that  was   not   put  forward   from                                                                    
Representative  Wool. It  was a  proposal  to provide  $16.3                                                                    
million  to  the University  of  Alaska  to accommodate  the                                                                    
Board of Regents' budget request.                                                                                               
                                                                                                                                
HB  57  was   HEARD  and  HELD  in   committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
HB  59  was   HEARD  and  HELD  in   committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
Co-Chair Seaton  addressed the schedule  and agenda  for the                                                                    
following day.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
7:00:05 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 7:00 p.m.                                                                                          
                                                                                                                                

Document Name Date/Time Subjects
DHSS-Subcommittee Packet HFIN.pdf HFIN 2/27/2017 1:00:00 PM
HB 57
UOA-Subcommittee Packet HFIN.pdf HFIN 2/27/2017 1:00:00 PM
HB 57
DOT-Subcommittee Packet HFIN .pdf HFIN 2/27/2017 1:00:00 PM
HB 57
DFG-Subcommittee PacketHFIN.pdf HFIN 2/27/2017 1:00:00 PM
HB 57
LEG-Subcommittee Packet HFIN.pdf HFIN 2/27/2017 1:00:00 PM
HB 57
JUD-Subcommittee Packet HFIN.pdf HFIN 2/27/2017 1:00:00 PM
HB 57
LAW-Subcommittee Packet HFIN.pdf HFIN 2/27/2017 1:00:00 PM
HB 57