Legislature(2017 - 2018)ADAMS ROOM 519
03/05/2018 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB285 || HB286 | |
| Amendments | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 286 | TELECONFERENCED | |
| += | HB 285 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
March 5, 2018
1:34 p.m.
1:34:29 PM
CALL TO ORDER
Co-Chair Seaton called the House Finance Committee meeting
to order at 1:34 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 (via teleconference)
Representative Lance Pruitt
Representative Steve Thompson
Representative Cathy Tilton
Representative Tammie Wilson
MEMBERS ABSENT
None
ALSO PRESENT
Pat Pitney, Director, Office of Management and Budget,
Office of the Governor; Quinlan Steiner, Director, Public
Defender Agency, Department of Administration; Catherine
Reardon, Director, Division of Administrative Services,
Department of Commerce, Community and Economic Development;
Heidi Teshner, Director, Division of Administrative
Services, Department of Education and Early Development;
Paul Prassing, Director of Student Learning, Department of
Education and Early Development.
PRESENT VIA TELECONFERENCE
April Wilkerson, Director, Division of Administrative
Services, Department of Corrections; Scott Kelley,
Director, Commercial Fisheries Division, Department of Fish
and Game; Carol Petraborg, Director, Administrative
Services, Department of Fish and Game.
SUMMARY
HB 285 APPROP: MENTAL HEALTH BUDGET
HB 285 was HEARD and HELD in committee for
further consideration.
HB 286 APPROP: OPERATING BUDGET/LOANS/FUNDS
HB 286 was HEARD and HELD in committee for
further consideration.
Co-Chair Seaton reviewed the agenda for the meeting. He
reported that in the prior week the committee adopted the
new committee substitutes for the budget bills that
incorporated the first round of amendments. He provided
further detail.
HOUSE BILL NO. 285
"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."
HOUSE BILL NO. 286
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs; capitalizing funds; amending
appropriations; making supplemental appropriations;
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."
1:34:29 PM
^AMENDMENTS
1:36:31 PM
Representative Wilson MOVED to ADOPT Amendment H DOA 3
(copy on file):
Office of Information Technology
Alaska Land Mobile Radio
H DOA 3 - 3009: Structure/Infrastructure Land
Offered by Representative Wilson
FY17 Actuals were $949.9 and the FY19 Governor's
request is $3947.3. A decrement of $1,000.0 will
result in a FY 19 budget request of $2947.3 for
structure, infrastructure and land repairs,
maintenance, rental, and leases.
Representative Grenn OBJECTED.
Representative Wilson read the amendment description [see
above].
Representative Grenn spoke to his objection. He explained
that the Alaska Land Mobile Radio (ALMR) provided day-to-
day and emergency radio services for Alaska's first
responders. He detailed that the State of Alaska, the
[U.S.] Department of Defense, other federal agencies, and
local municipalities used the service to help ensure the
public safety communications system in Alaska was reliable
and available 24 hours per day. He agreed that the FY 17
actuals read by Representative Wilson were accurate;
however, the governor's budget included an additional line
item of $2.6 million for repairs, maintenance, leases, and
rentals. He spoke to the importance of providing
flexibility to the departments pertaining to the two
account codes. The proposed amendment would reduce the
agency budget far below its FY 17 actual spend. The
reduction would bring the agency's budget below its
historical spending. He believed the amendment would have
unintended consequences on the agency.
Co-Chair Seaton highlighted that the amendment structure
looked at actuals two years back. The committee had
received a document based on the questions of the
procedure. He invited the Office of Management and Budget
(OMB) director, Pat Pitney, to the table to address the
amendment structure.
PAT PITNEY, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, conveyed that the OMB document
["FY2019 Amendments Based on FY2017 Actuals" dated March 5,
2018 (copy on file)] covered many actuals aligned with
amendments under consideration by the committee. She
explained that through the Executive Budget Actcut, the
legislature provided appropriations and allocations. The
control of the legislature was at the appropriation level
and to a lesser extent at the allocation level; there were
provisions to move across allocations within an
appropriation. She pointed to an example in the document
that used H DOA 3, which looked at the lowest accounting
class (3009) covering items that were also included in
accounting class 3010. The accounting class was very
detailed and provided management with the ability to track
expenditures at a very low level to ensure good management
information.
Ms. Pitney continued that between the accounting classes
and allocations there was also object type, which included
personal services, travel, contractual, and other. Above
the object type, the location in the organization. She
provided an example using ALMR that included two spending
components. The ALMR allocation was shown above that
information. She explained that the legislature control was
at that allocation. She elaborated that the allocation
included different fund sources. There may be a lower cost
level in an allocation because federal funds had not been
received. She continued that if the spending was below the
budget, the agency could not spend if it did not have the
revenue.
Ms. Pitney elucidated the allocation in the particular ALMR
component was less than $1,000 general funds lapsed at the
end of the year. From a budgeting perspective, less than
one tenth of 1 percent of the budget was lapsed. She
believed it executed the appropriation level for its
purpose without overspending. Typically, there was a 1 to 2
percent flexibility because an agency never wanted to
overspend in an allocation or appropriation - it would mean
coming back for ratification. The ALMR allocation level had
been less than $1,000 - the funds had been budgeted under
code 3009 and spent under code 3010 for the exact same
function. She stressed that it was necessary to look at
actuals at the legislative control level - the allocation
or the appropriation.
Representative Wilson found it interesting that the
legislature only had control over a certain portion. She
believed constituents felt that legislators should know
where the money was being spent. She asked for verification
that numerous entities besides the state were using the
ALMR service.
Ms. Pitney responded that the system was used by local
police forces and the [U.S.] Department of Defense, which
provided federal funding.
Representative Wilson remarked that local fire departments
[in Fairbanks] used the service. She believed it was time
for everyone using the service to begin pitching in for the
cost. She asked if the state had considered reducing
funding and asking other users to contribute to the
service.
Ms. Pitney responded that the administration had looked at
the idea. She detailed it was a policy call that was
unrelated to the amendment. The administration believed it
was in the state's best interest to have interoperability
of its emergency communications. She explained that when
the fire and police departments had entered into the
process it had been with an expectation of what it would
cost them to run the system. She furthered that the
administration had not elected to make that change at a
time when public safety issues were facing the state.
1:46:24 PM
Representative Wilson argued that the chair had made the
rules in terms of not being able to apply percentages for
line items. She spoke to transparency and remarked there
were different areas because the money was going to
different spots. She elaborated that the committee was now
hearing the funding was going somewhere in the area versus
to the line item it was supposed to go towards. She
stressed that the legislature was responsible for knowing
where the money was going. She stated it would be different
if the amendment went all the way down to the $949,000. She
observed there was a $3 million difference. She thought the
numbers should be combined on one line for clarity or the
administration needed to be clearer about where the money
was needed.
Ms. Pitney explained that the line item being discussed was
object class 3009. She explained that the budgeted line
item pertained to structure, infrastructure and land
repairs, maintenance, rental, and leases. The expenditure
had been made in object class code 3010, which was
described as machinery, furniture, office equipment
purchase, repairs, maintenance, rental, and leases. The
repairs, maintenance, rental, and leases were the same in
both object classes. She continued that as the state came
online with the new accounting system and object classes
were refined, they were accounting for the same thing. She
underscored that the administration was accounting for the
expenditures, but from a budgeting perspective, most of it
would be at the object type level covering all of the
3000s. She argued the importance of the accounting
precision that was different than a budgeting precision.
She reported that if the administration had to budget at an
object class code, the cost of accounting and budgeting
would be significant. She emphasized that "you're operating
at an accounting level, you're budgeting at a management
level." There was a true difference between how the two
worked.
1:49:14 PM
Vice-Chair Gara disagreed with the earlier suggestion to
transfer costs to municipalities. He did not believe that
qualified as cutting the budget. He explained the idea
behind ALMR was to ensure local and state authorities could
communicate during an emergency in order to save lives. He
spoke to the importance of understanding what the impact
would be prior to suggesting costs should be taken on by
communities. He disagreed with transferring the onus to the
municipalities which would be seen in property taxes.
Co-Chair Seaton advised members to keep their discussions
limited to the amendment.
Representative Wilson believed the topic was part of the
conversation. She felt that at some point the state had
taken on costs that were not necessarily state costs. She
discussed the state was supposed to provide basic services,
which had never really been defined. She added that the
state had also started programs. She questioned whether the
state could afford to continue funding certain programs.
She was not saying municipalities needed to pay the full
cost for ALMR, but she wondered whether the same groups
were all still part of the program. She remarked that some
people had changed to other methods because they found that
ALMR was too expensive. She did not believe the program did
exactly what it was supposed to do when they first looked
at it because it had become much more expensive than people
had thought. Additionally, federal money had been used and
much of the funding had been backfilled with state funding.
She was concerned about the cost. She reasoned if the state
was looking at other people's money, it needed to know what
the money was being spent on (and not similar things).
Representative Grenn MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Grenn, Guttenberg, Kawasaki, Ortiz, Gara, Seaton,
Foster
The MOTION to adopt H DOA 3 FAILED (4/7).
1:52:41 PM
Representative Wilson MOVED to ADOPT Amendment H DOA 4
(copy on file):
Office of Information Technology
State of Alaska Telecommunications System
H DOA 4 - 3003: Information Technology
Offered by Representative Wilson
FY17 Actuals were $10.1 and the FY19 Governor's
request is $105.7. A decrement of $50.0 will result in
a FY 19 budget request of $55.7 for software licensing
and maintenance, training and consulting.
Representative Grenn OBJECTED.
Representative Wilson read the amendment description [see
above].
Representative Grenn spoke to his objection. He relayed the
State of Alaska Telecommunications System provided reliable
telephone network, data center, and data processing to all
executive branch departments. He had similar concerns to
the prior amendment. He stated that the FY 17 undesignated
general funds (UGF) for the system was $4,696,000, while
the FY 19 governor's request was a decrease of more than
$200,000. He reported the fund sources had been reduced
over 13 percent since FY 17. Another $50,000 decrement
would bring the budget below FY 17 actuals. He believed the
organization was absorbing cuts already and an additional
cut would have consequences he did not support.
Representative Wilson did not believe a $50,000 reduction
would be significant for the office. She stated the office
should know what the costs were in the areas of software
licensing and maintenance, and training and consulting.
would make a difference. She stated that the office had not
spent the money in FY 17 in this area. She remarked "if you
want to keep mixing the money together that's up to you."
Representative Grenn MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Guttenberg, Kawasaki, Ortiz, Gara, Grenn, Foster,
Seaton
The MOTION to adopt H DOA 4 FAILED (4/7).
1:55:36 PM
Vice-Chair Gara MOVED to ADOPT Amendment H DOA 5 (copy on
file):
Legal and Advocacy Services
Office of Public Advocacy
H DOA 5 - Improve services provided to abused and
neglected children by adding 4 Guardian ad Litems to
OPA.
Offered by Representative Gara
The Office of Public Advocacy (OPA) Child Advocacy
Unit represents the best interests of abused and
neglected children who are involved in the juvenile
courts, including Child in Need of Aid (CINA),
domestic violence, juvenile delinquency, private
custody, adoption, emancipation, and other cases. Most
of their cases involve children in the foster care
system and their interest in quickly finding a loving,
permanent home for them, which will often be their
original family.
Guardian Ad Litems (GALs) are an independent voice for
these children, neither representing the state nor
parents. Unfortunately, their current caseloads of
100-110 children (sometimes more) are unmanageably
high. A reasonable caseload is approximately 80
children per GAL. These heavy loads prevent GALs from
getting to know the children they are charged with
representing, and adequately assessing and speaking on
behalf of their best interests. In many respects, the
voices of GALs are the most critical in the child
protection system.
The number of Guardian Ad Litem appointments has
skyrocketed in recent years, growing from 1,076 in FY
12 to 1,949 in FY 17. Almost all of these are for CINA
cases. A smaller number are for custody and domestic
violence cases. GALs are court-appointed and
statutorily required through AS 44.21.410. With high
caseloads, GALS are not able to visit children
regularly and risk not being able to know youth well
enough to succeed at effectively promoting their best
interests.
While OPA is using contractors to meet some of the
need, it has been difficult to find and retain
contract GALs and ensure high quality work. Staff GALs
generally provide higher quality service because they
have direct supervision and support and greater
knowledge of relevant laws and policies.
Hiring one additional GAL each in Anchorage,
Fairbanks, Palmer, and Juneau will meet help this need
and bring caseloads down to acceptable levels.
Representative Wilson OBJECTED for discussion.
Vice-Chair Gara reported the amendment represented work he
had wanted to do his entire career. He detailed that the
guardian ad litem section at the Office of Public Advocacy
was chronically underfunded. He explained that the
individuals represented a child's best interest, either in
foster care cases, domestic violence cases, and custody
cases sometimes when court appointed. The individuals were
charged to show up in court to say what was in the child's
best interest. The individuals were supposed to know the
children they represent. Currently, caseloads were at about
110 or more per guardian, while the recommended maximum was
about 80. He explained that four additional guardian
positions could accomplish caseloads closer to 80. He
explained it would make a huge difference not having
guardians show up in court to represent a child without
looking at their file beforehand. The combined number of
cases for guardians ad litem and public guardians had
doubled since 2012 (from 1,076 to 1,949), while the number
of the workers had increased by around two positions. He
felt it was a modest amendment to try to bring some balance
to children's right to have their interests represented in
court.
Representative Wilson spoke to her objection. She thought
it was what happened when the legislature started doing
things in silos. She stated that unless the legislature
wanted to look at why the state was taking so many children
out of homes, she wondered if they were going to get to the
root of many of the increases that were tearing families
apart. She did not agree with only increasing one portion
without understanding the increase in other areas.
Vice-Chair Gara believed the number of youth in custody at
the Office of Children's Services had somewhat stabilized.
He relayed the number was not where he would like it to be,
but without people working in the system it was not
possible to get youth out of the system. He stressed that
the youths lingered, languished, and got hurt. He explained
that the amendment would put one guardian in each of four
different offices. Extra office space was not needed - the
amendment was as efficient as possible for roughly $450,000
(it included no additional office staff).
Representative Wilson MAINTAINED her OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Kawasaki, Ortiz, Gara, Grenn, Guttenberg, Seaton,
Foster
OPPOSED: Pruitt, Thompson, Tilton, Wilson
The MOTION PASSED (7/4). There being NO further OBJECTION,
Amendment H DOA 5 was ADOPTED.
1:59:58 PM
Representative Grenn MOVED to ADOPT Amendment H DOA 6 (copy
on file):
Legal and Advocacy Services
Office of Public Advocacy
H DOA 6 - Increase Public Defender Agency Funding to
Meet Projected FY19 Caseload
Offered by Representative Grenn
The Public Defender Agency FY2018 caseload is
projected to exceed both American Bar Association and
Alaska Division of Legislative Audit guidelines for
maximum ethically permissible caseloads. Second
quarter data for FY2018 shows substantial increases in
major case appointments across the State, with
increases projected into FY2019.
Per Alaska Division of Legislative Audit standards,
the recommended maximum ethical caseload for the
Public Defender Agency is 60 hours per week, or a
weighted average of 59 cases per attorney. The Agency
is currently projecting a weighted average of 92 cases
per attorney, 56% above the recommended maximum.
These caseloads are unsustainable, cannot be absorbed,
and may force attorneys to refuse case appointments on
ethical grounds. Insufficient resources will cause
additional delay across the justice system, expose the
state to liability for failing to meet its
constitutional obligations, and increase the
likelihood that courts will take independent action.
The State may then be required to contract private
attorneys at a significantly higher, hourly rate.
Delays on the side of Public Defenders will also have
an impact on victims of crime who have a
constitutional right to the timely resolution of their
case.
This amendment adds four Attorney III positions and
one Law Office Assistant I position. The attorney
positions are expected to be located in Bethel,
Ketchikan, Fairbanks, and Anchorage, with the
additional support staff position located in
Anchorage.
Given the Public Defender Agency has consistently
received annual supplemental funding to meet
constitutional obligations, it is likely this funding
will be requested through the FY2019 Supplemental
Budget, if not funded through the Operating Budget
process.
Representative Wilson OBJECTED.
Representative Grenn read from the amendment description
[see above]. He read from prepared remarks:
The Public Defender Agency provides constitutionally
mandated legal representation to defendants appointed
by the court as well as parents in Child in Need of
Aid (CINA) cases.
Representative Grenn detailed that during the subcommittee
process he had learned the agency had no control over cases
as they were assigned. The agency was experiencing
caseloads that exceed state and national best practice
standards. One example used the American Bar Association
guideline for maximum ethical caseloads of about 150 cases
per attorney per year. He reported that in FY 18 the Public
Defender Agency was projected to have 160 cases per
attorney per year. In FY 19 the number was expected to
continually increase. A 1998 study by the legislature's
Division of Legislative Budget and Audit found that a
Public Defender Agency attorney working 60 hours per week
should have a maximum of 59 cases per attorney, whereas
attorneys at the agency had an average of 92 cases (56
percent over the recommended maximum). The agency could not
absorb or predict the increasing caseloads, which made it
difficult to retain positions. He believed adding the
positions would significantly help victims and those in
need of defense.
Co-Chair Seaton relayed that a member from the agency was
available to answer questions.
Representative Pruitt remarked there were two amendments he
would offer, which he would not discuss at present. He
contended that the problem was a management issue rather
than a money issue. He looked at FY 14 as a baseline and
included the Department of Law (DOL) Criminal Division
(which includes Child Protective Services), which had
decreased by 6.5 percent compared to the Office of Public
Advocacy and the Public Defender Agency [both under the
Department of Administration], which had increased by 2.3
percent. He underscored there was a 48 percent increase in
the Office of Public Advocacy and the Public Defender
Agency, whereas the increase in DOL was 40.7 percent. He
had heard that the system would be thrown out of balance.
He stated if that were true he thought the prosecutors
should be increased at the same rate. He stated the
committee continued to hear a 1998 audit being utilized. He
did not know whether there was anything new, but he
believed it was an old standard to use.
Representative Pruitt opposed the amendment. He highlighted
there were many more high-level attorney IV to VI positions
in the Public Defender Agency than in the DOL Child
Protective Services Division. He reiterated his belief the
issue was not about money, but about management. He stated
that the situation should be dealt with by adjusting how
services were delivered. He understood the state did not
have the money at present. He spoke to the need to examine
the structure of an agency and in this case, to determine
whether it needed all of its high-level attorney positions
if other departments had fewer. He did not believe the
amendment addressed the management issue. He stated the
department had received an increase since 2014. He
reiterated his testimony about decreases at DOL. He did not
believe it was an apples-to-apples situation; therefore, he
did not believe the money increase would solve the issue.
2:06:07 PM
Vice-Chair Gara argued that if the amendment did not pass
it would be a hit to victims. He underscored it was a
public safety amendment. In order to have a well-
functioning criminal justice system, it was necessary to
have enough prosecutors and police on the street. It was
also necessary to have the ability to process the cases. He
stated that cases would languish without the amendment,
meaning victims would wait longer for justice. He
considered whether they wanted better public safety in
Alaska. With a decrease in prosecutors in recent years, the
state had been declining cases. As prosecutor positions
were added back, there was a need for people to defend
individuals being prosecuted (the requirement was
constitutional). He did not want victims to wait longer for
justice, he wanted the cases to be processed accurately, he
wanted the guilty to go to jail, and the innocent to be
rightly represented.
Representative Wilson asked how often Alaska's courtrooms
were empty. She reasoned that if courts were full and could
not take any more cases, adding attorneys would not help.
She wondered how many cases per year were plea-bargained
and did not require going to court. She believed the courts
were always full. She wondered where the cases would be
added if there was no more room in the court houses.
Representative Grenn responded that getting up to capacity
with attorney positions was not only about going to court,
but involved plea bargaining and other work. He asked to
hear from the agency for a better description of the
process.
Representative Wilson thought it was really about numbers,
not the process. She reiterated her understanding that
courtrooms were full every day. She wondered how more cases
would be heard if there was no courtroom space.
2:09:27 PM
QUINLAN STEINER, DIRECTOR, PUBLIC DEFENDER AGENCY,
DEPARTMENT OF ADMINISTRATION, stated his understanding of
the question.
Representative Wilson clarified her question. She wondered
how the cases would go more quickly if the courtrooms were
already at capacity.
Mr. Steiner replied that he could not speak to whether or
not the court system was at capacity. He reported the cases
were coming in the door and the agency had to respond to
them. When the agency was appointed to a case there was a
certain amount of work it had to do, much of the work was
done outside of court including the review of police
reports, investigation of cases, and discussion with
clients. He elaborated it was the process by which cases
either resolve as a plea - which led to court for a hearing
and sentencing - or trial, but much of the work was done
outside of the court system's work. Regardless of the court
system's capacity for an additional hearing, the Public
Defender Agency still had to accomplish the work. He
reasoned that adding attorneys, meaning the agency could
process its cases more efficiently, could impact the trial
rate in a positive way that may be more efficient than
running things out. He explained that a lack of defense
lawyers caused delays, litigation went up, and it put
upward pressure on court time.
Representative Wilson asked what percentage of criminal
cases the agency received were plead out and did not go to
court.
Mr. Steiner responded that at some point the cases all went
to court, but the pleading out rate was probably around 95
percent or higher.
Representative Thompson asked what percentage of cases
going to court got referred to a public defender.
Mr. Steiner replied that the preceding year 79 percent of
felonies had been assigned to public council and he
believed 57 percent of misdemeanors had been assigned to
public council. Historical values hovered around 80 percent
for felonies and slightly over 50 percent for misdemeanors.
Vice-Chair Gara surmised that when cases were plead out, it
did not occur on day one. He elaborated that often all of
the work was done until the eve of trial when parties
understood the strengths and weaknesses of each side of the
case. He asked for verification that cases were often plead
out the week or day before trials.
Mr. Steiner agreed that many cases plead out at the last
minute. The more complex a case was, the more work required
up front - including reading police reports, conducting
investigation, and working with a client. The less complex
cases may resolve a bit sooner. All of the work had to be
done before an attorney could recommend a plea agreement
and work with the client had to be done so the client
understood the case and trusted that the lawyer had done
everything that could be done to make the recommendation.
He noted it was a time-consuming process that took place
outside of court.
2:13:45 PM
Co-Chair Seaton mentioned that a statement was made about
too many Attorney V and VI positions. He noted the
amendment included attorney III positions. He asked Mr.
Steiner if it was the lowest level attorneys the agency
hired. He wondered why attorney III positions would be
appropriate.
Mr. Steiner explained the reason attorney IIIs were
appropriate was there had been recent policy decisions by
the Municipality of Anchorage to assume misdemeanor
prosecutions. He elaborated that the misdemeanor caseload
relative to the felony caseload had decreased. The agency
was primarily engaged with felony criminal practice across
the state. The need for entry-level attorneys had
diminished and the agency was dealing with more complex
felonies than in the past. Based upon resource decisions,
the cases tended to be the more complicated, violent
felonies; therefore, the agency was seeking attorney III
positions to address lower level Class B and C felonies.
2:14:56 PM
Co-Chair Seaton asked if the courts were in session on
Friday afternoons at present. Mr. Steiner responded that
currently the court system was closed on Friday afternoons.
Co-Chair Seaton surmised that the time was not taken up
with actual cases in court [on Friday afternoons]. Mr.
Steiner answered in the affirmative. The agency used the
time in the office to work on files and speak with clients.
Representative Grenn asked about the consequences for the
state if caseloads were not reduced.
Mr. Steiner answered that if caseloads reached 160 [per
attorney], the agency would be forced ethically to refuse
cases. There was a principle of ethics that required a
lawyer not to accept a case if they could not competently
handle the case. Not having enough time would be the reason
and the agency would attempt to refuse cases. He elaborated
that if the court granted, the state would be required to
pay private lawyers at a much higher rate. If the court
system did not grant the request and ordered the Public
Defender Agency to engage the cases, the resulting problems
would be significant litigation on motions to withdraw and
motions to dismiss as well as substantial delay. The
litigation, the increased delay, and the likelihood of
increased errors would result in potentially retrying the
cases. He would anticipate a higher processing cost per
case, in addition to delays and impacts of failing to
resolve cases in a timely manner.
2:16:54 PM
Representative Wilson MAINTAINED her OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Ortiz, Gara, Grenn, Guttenberg, Kawasaki, Foster,
Seaton
OPPOSED: Pruitt, Thompson, Tilton, Wilson
The MOTION PASSED (7/4). There being NO further OBJECTION,
Amendment H DOA 6 was ADOPTED.
2:17:50 PM
Representative Pruitt MOVED to ADOPT Amendment H DOA 7 and
H DOA 8(copies on file):
Legal and Advocacy Services
Office of Public Advocacy
H DOA 7 - Delete 10 Attorney V positions in Public
Defender Agency.
Offered by Representative Pruitt
The Public Defender Agency's current caseloads exceed
the American Bar Association (ABA) guidelines for
maximum ethically permissible caseloads. Continued
increases in civil case appointments combined with
staff reductions resulted in caseloads that remain
above guideline maximums even though criminal case
appointments declined in FY2017. The Agency projects
that caseloads will remain above guideline limits in
FY2018 and FY2019.
These amendments will reduce the funding for Attorney
V's in the Public Defender Agency by $2,104.0. An
average UGF cost of 10 Attorney V's was approximately
$210.0 per position. An average UGF cost of 10
Attorney II's was approximately $138.0 per position.
Removing 10 Attorney V's will allow hiring of 15
Attorney II's for the same cost.
Legal and Advocacy Services
Office of Public Advocacy
H DOA 8 - Add 15 Attorney II positions in Public
Defender Agency.
Offered by Representative Pruitt
The Public Defender Agency's current caseloads exceed
the American Bar Association (ABA) guidelines for
maximum ethically permissible caseloads. Continued
increases in civil case appointments combined with
staff reductions resulted in caseloads that remain
above guideline maximums even though criminal case
appointments declined in FY2017. The Agency projects
that caseloads will remain above guideline limits in
FY2018 and FY2019.
These amendments will reduce the funding for Attorney
V's in the Public Defender Agency by $2,104.0. An
average UGF cost of 10 Attorney V's was approximately
$210.0 per position. An average UGF cost of 10
Attorney II's was approximately $138.0 per position.
Removing 10 Attorney V's will allow hiring of 15
Attorney II's for the same cost.
Representative Grenn OBJECTED.
Representative Pruitt reviewed the amendments. He surmised
that if there was a challenge in terms of [legal]
representation or about turning people away, perhaps the
legislature should look internally into the agency [Public
Defender Agency] to determine whether there was a way to
manage the cases differently. The amendments allowed for
the addition of 5 attorney II positions if the agency
reduced its attorney V positions by 10. The amendment would
bring the total number of attorney II positions to 15 for
the same cost the department was currently paying. He
stated there were 100 attorneys in the department
[Department of Administration]. He believed the amendment
addressed multiple concerns. He detailed that the state did
not have additional cash flow and the committee had heard
from Mr. Steiner that the agency needed additional people
to manage its caseloads. He believed the prudent way to
handle the situation was to encourage the proper management
of the department based on the scenario currently facing
the state. He stated the department had received an
increase since 2014, while decreases had occurred in other
state departments. He disagreed that it was not the
prosecutors and the troopers forcing the conversation. He
thought the management of the department needed to be
analyzed.
2:20:15 PM
Vice-Chair Gara asked if the amendment sponsor had
conducted any assessment on whether attorney IIs were
experienced enough to handle high-level felonies.
Representative Pruitt replied in the negative. He remarked
there were 100 attorneys in the department and he assumed
there was opportunity to shuffle attorneys around. He
acknowledged that some may not have the experience, but
some may be willing to start the conversation. He recalled
being on a jury where the defense attorney had been right
out of law school and they had successfully defended the
client. He stated that just because a person may not have
the experience did not mean they could not do the job.
Representative Grenn spoke to his objection. He appreciated
Representative Pruitt for proposing the hire of additional
attorneys. However, he did not believe replacing attorney
Vs who were subject matter experts and could handle Class A
felonies (there had been an increase in felonies across the
state) was prudent. He stated the need for experienced
attorneys who could handle the cases was vital. He did not
support replacing the more experienced attorneys with
individuals directly out of law school to handle complex
cases.
Representative Wilson clarified that she did not want to
send the message that the committee was telling new
attorneys they were not good. She acknowledged there were
many great attorneys working for the state - some with more
experience than others.
Co-Chair Seaton asked Mr. Steiner to explain the difference
between an attorney V and attorney II. He asked if one
supervised other attorneys.
Mr. Steiner explained that an attorney V was either a
supervising attorney at the highest level who could handle
Class A and unclassified felonies (homicides and first-
degree sex assault cases) independently or in a
supervisory/training role. Attorney Vs were also statewide
subject matter experts on practice or litigation areas
within different case types. For example, there were
experts who handle any litigation surrounding "guilty but
mentally ill" or "not guilty by reason of insanity and
competency." When attorneys were experienced in those
issues it meant they could be assigned to oversee
litigation in that area, which was much more effective and
efficient than reinventing the wheel each time. Attorney
IIs were fresh out of law school or a clerkship. The impact
of the amendment would be fairly dramatic - the agency
would lose the supervisory class and expertise, which would
essentially render the agency incompetent to handle the
cases. As a manager, he was required to ensure that lawyers
were supervised, and that the agency was handling it
competently. He explained that because the agency was
statewide and handled such a high level of cases, the
positions were necessary to ensure the attorney IIIs and
IVs were litigating in the required manner.
2:24:49 PM
Representative Thompson asked how many attorney Vs worked
for the state.
Mr. Steiner asked if Representative Thompson was speaking
to the entire state system or the Office of Public
Advocacy.
Representative Thompson replied he was interested in the
Office of Public Advocacy. Mr. Steiner believed there were
10 attorney Vs. He detailed the agency had multiple trial
unit supervisors in Anchorage as well as subject matter
experts in the appellate division. There were supervising
attorneys in Fairbanks, Kenai, Palmer, and Juneau. The
office was subdivided on a regional basis. For example,
Fairbanks supervised the Barrow office and Nome supervised
the Kotzebue office. The larger offices were supervised
independently underneath the deputy director in Palmer and
Kenai. He added that Southeast operated as a region. The
office was able to supervise and oversee litigation on a
regional basis.
2:25:59 PM
Co-Chair Seaton stated that the office had 10 attorney V
positions. He asked for verification that the amendment
would delete all of the office's 10 supervisory positions.
Mr. Steiner replied in the affirmative. The office would be
left with no acting supervisors regionally or in the
Anchorage office. He expected the individuals would resign
and the office would no longer have the expertise and
capacity to oversee and litigate the high-level cases. He
stated it would very likely lead to a conflict situation
where the office would have to get out of the cases because
it would be incompetent to handle that many. There would be
only a few lawyers left in the system that would be capable
of handling the cases.
Representative Pruitt appreciated the concern. However, the
amendment pertained to part of the continued discussion the
legislature had over the past couple of years - how to
manage the current situation if the state did not have
money. He stated that the legislature had not forced
things, but he surmised perhaps it should be more active.
He understood there may be challenges, but he stated the
agency had not been required to analyze its ability to
manage what it had because it had seen a budget increase in
the past few years. He remarked that the agency they were
arguing against [DOL] had seen a budget decrease. He
thought the amendment was a reasonable request. He stated
it would do what the agency had requested by giving it more
attorneys. He reasoned that giving more attorneys meant
something had to give. He believed people were telling the
legislature consistently there was not enough money to
continue to add to the budget. He thought it was necessary
to reanalyze how the service was delivered.
Representative Grenn MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton
OPPOSED: Wilson, Gara, Grenn, Guttenberg, Kawasaki, Ortiz,
Seaton, Foster
The MOTION to adopt Amendments H DOA 7 and H DOA 8 FAILED
(3/8).
2:29:23 PM
Representative Wilson MOVED to ADOPT Amendment H CED 3
(copy on file):
Community and Regional Affairs
Community and Regional Affairs
H CED 3 - 3000 Education Services
Offered by Representative Wilson
FY17 Actuals were $130.4 and the FY19 Governor's
request is $230.0. A decrement of $50.0 will result in
a FY 19 budget request of $180.0 in Training,
Educational Conferences, agency memberships, tuition,
books and fees for work-related courses.
Representative Guttenberg OBJECTED.
Representative Wilson read the amendment description [see
above].
Representative Guttenberg spoke to his objection. He
explained that the actuals GF were not available and had
not been spent. He detailed the capital improvement project
funds had been underspent. He explained that cutting the GF
would prevent the department from doing many things across
the department. The GF was used in numerous places.
Representative Wilson stressed the purpose of the budget
was to know where the money was spent. She stated if the
legislature was not going to figure that out, the
departments should just provide an amount of money they
want. She was not willing to let departments spend the
money wherever they want to. She did not believe it was
what legislators were supposed to do. She stressed that
legislators were responsible to their constituents. She
elaborated that the $180,000 was meant for training,
educational conferences, agency memberships, tuition, books
and fees for work related courses. She believed the
department should come tell the legislature if it needed
the money for other things. She underscored there was no
choice but to look into the details of how money was spent.
She reasoned that before her constituents were faced with
being taxed for something they would want to know where the
money was going. She thought the legislature was
communicating that it would not look at what the agencies
were saying they were spending the funds on because in
reality the agencies would spend the funds wherever they
want. She believed it was unacceptable.
Representative Guttenberg MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Thompson, Tilton, Wilson, Pruitt
OPPOSED: Gara, Grenn, Guttenberg, Kawasaki, Ortiz, Foster,
Seaton
The MOTION to adopt Amendment H CED 3 FAILED (4/7).
2:33:34 PM
Representative Wilson MOVED to ADOPT Amendment H CED 4 and
H CED 5 (copies on file):
H CED 4
Community and Regional Affairs
Community and Regional Affairs
H CED 4 - 3011: Other Services
Offered by Representative Wilson
FY17 Actuals were $59.4 and the FY19 Governor's
request is $477.6. A reduction of $200.0 will result
in a FY 19 budget request of $277.6 to pay for other
services, including printer/copy machine services,
printing services and State Travel Office fees. This
reduction will allow for a FY 19 budget which is
$218.2 over FY 17 actual expenditures.
H CED 5
Economic Development
Economic Development
H CED 5 - 3011 Other services
Offered by Representative Wilson
FY17 Actuals were $87.3 and FY19 Governor's request is
$298.3. A decrement of $100.0 will result in a FY 19
budget request of $198.3 in other services, including
printer/copy machine services, contracting services,
marketing collateral materials, and State Travel
Office fees. This reduction will still allow for a FY
19 budget that is more than twice the amount actually
expended in FY 17.
Representative Guttenberg OBJECTED.
Representative Wilson read the amendment descriptions [see
above].
Representative Guttenberg spoke to his objection. He
explained that in FY 17 there were two federal grants that
had not been available in other years, meaning the
department had been able to not use UGF. The department had
cut its economic development positions from 16 to 7, which
had resulted on a larger emphasis of contracting out. The
efforts included strategic economic development, expansion
of programs into communities, identifying local business
climates, the Made in Alaska program, growth maximizing in
maritime, startups, innovation, and other. The department
had been cut significantly by a 70 percent UGF reduction.
Representative Wilson stressed that the department was
receiving more funding than it had received in FY 17 and FY
18. She explained the amendment did not mean the department
would receive the same budget year after year, but the
legislature would look at what was actually spent. She
believed that the department should ask the legislature if
it needed the money somewhere else. She concluded it was
still a gain, not a cut.
Representative Guttenberg MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Tilton, Wilson, Grenn, Pruitt, Thompson
OPPOSED: Gara, Guttenberg, Kawasaki, Ortiz, Seaton, Foster
The MOTION to adopt Amendments H CED 4 and H CED 5 FAILED.
(5/6).
2:37:30 PM
Co-Chair Seaton MOVED to ADOPT Amendment H CED 6
Alcohol and Marijuana Control Office
Alcohol and Marijuana Control Office
H CED 6 - Add Legislative Intent regarding Marijuana
Regulation
Offered by Representative Seaton
Wordage: It is the intent of the legislature that the
July 1, 2019, appropriation of the unexpended and
unobligated program receipts from the licensing and
application fees related to the regulation of
marijuana of the Department of Commerce, Community,
and Economic Development, Alcohol and Marijuana
Control Office, be limited to the cost of marijuana
regulation for the fiscal year ending June 30, 2020,
and that the remaining unexpended and unobligated
balance of program receipts from the licensing and
application fees related to the regulation of
marijuana on June 30, 2019, lapse into the general
fund. It is the intent of the legislature that
licensing and application fees related to the
regulation of the marijuana industry be maintained at
a level that allows for the sum of $4,646,100 to lapse
into the general fund, at which time licensing and
application fees may be adjusted to cover anticipated
annual operating costs for marijuana regulation. It is
the intent of the legislature that the Alcohol and
Marijuana Control Office report to the co-chairs of
the Finance Committees and the Legislative Finance
Division by January 1, 2020, the amount of program
receipts from the licensing and application fees
related to the regulation of marijuana that lapsed
into the general fund.
Explanation: 30-GH2564O.14
This amendment adds legislative intent language
directing the Alcohol and Marijuana Control Office as
follows:
--In the FY20 budget, limit the amount of unexpended
and unobligated program receipts from licensing and
application fees related to the regulation of
marijuana that are carried forward from FY19 into
FY20, equal to the cost of marijuana regulation.
--All excess program receipts at the end of FY19,
lapse to the general fund.
--Maintain the level of licensing and application fees
at a level that allows for $4,646,100 to lapse to the
general fund, and once that occurs licensing and
application fees may be adjusted to cover the
anticipated annual operating costs for marijuana
regulation.
--$4,646,100 equals the total unrestricted general
funds used to implement the regulation of marijuana -
Actual expenditures in FY15 and FY16 totaled
$1,812,500 -Actual expenditures in FY17 totaled
$1,248,300 -Appropriation in FY18 totaled $1,052,500 -
Appropriation in FY19 totaled $532,800
--Provide a report by January 1, 2020 to the co-chairs
of the Finance Committee and Legislative Finance
Division on the amount of program receipts lapsed to
the general fund.
Representative Wilson OBJECTED for discussion.
Co-Chair Seaton reviewed the amendment description [see
above].
Representative Wilson WITHDREW her OBJECTION.
Representative Pruitt OBJECTED for discussion. He reported
that he had been the chair of the subcommittee when the
conversation had begun and the intent in the amendment was
exactly what the subcommittee had envisioned. He
appreciated the amendment. He WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment H CED 6 was
ADOPTED.
2:40:55 PM
Representative Wilson MOVED to ADOPT Amendment H CED 7
(copy on file):
Alaska Energy Authority
Alaska Energy Authority Rural Energy Assistance
H CED 7 - 2000 In-State Employee Travel
Offered by Representative Wilson
FY17 Actuals were $33.0 and the FY19 Governor's
request is $125.0. A decrement of $50.0 will result in
a FY 19 budget request of $75.0. With this reduction,
the FY 19 budget request is more than twice the amount
actually expended in FY17 for in-state transportation
costs for travel relating to administration,
conventions and meetings, boards and commissions.
Representative Guttenberg OBJECTED.
Representative Wilson read the amendment description [see
above].
Representative Guttenberg spoke to his objection. He
explained that UGF from the Alaska Energy Authority (AEA)
had been fully expended. He detailed that UGF was critical
to many rural programs. Since FY 17, the value of the
capital projects had decreased and the statutory receipts
were not collected to equal the appropriate authority. He
thought changing the amendment to capital receipts would be
appropriate. He did not support a reduction to UGF.
Vice-Chair Gara stated that one of the things AEA did for
rural power systems, especially now that the state not
installing many new systems, was helping to bring power
systems back online when a problem occurred. He asked if
the cut would affect that function.
Representative Wilson replied in the negative. The
amendment pertained to instate travel, mostly utilized for
to administration, conventions and meetings, boards and
commissions. The amendment did not have anything to do with
emergency responses. She stated that it would still give
the agency twice as much funding as it had received in FY
17.
Representative Ortiz asked if anyone in the room could
explain the impact of the amendment on the department.
2:43:41 PM
CATHERINE REARDON, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC
DEVELOPMENT, replied that the UGF received by AEA had been
completely spent in each of the last three fiscal years; it
had not necessarily been spent on travel, but on the
essential activities of AEA. The amendment matched budgets
at sub-accounting levels, but looking at the component or
RDU level showed that UGF had been needed and fully used
for things like community assistance for utility worker
training and other. Cutting UGF would directly impact AEA
activities. The funding not used in AEA was capital
improvement project (CIP) receipts and some other funding
sources. When actuals were lower than budgeted, it was in
funding sources like CIP receipts that was not in UGF. The
underspending may have been in CIP receipts. Taking the
difference out of UGF would definitely impact the program.
She was glad to see the organization was not spending as
much on travel - it was spending the money on other needs
to meet community electrical and utility requirements.
2:46:10 PM
Representative Ortiz asked if AEA had seen significant
reductions in GF support since 2015.
Ms. Reardon responded that AEA was one of the Department of
Commerce, Community and Economic Development's (DCCED)
agencies that had seen the most cut because it had UGF. The
agency had two RDUs at one point with significant UGF in
them. She believed the agency had lost over $2 million UGF
since FY 15. She could follow up with further detail if
desired.
2:47:24 PM
Representative Ortiz referenced the $2 million reduction
and asked what the percentage reduction had been compared
to FY 15. Ms. Reardon responded she needed 15 minutes to
get an answer to the question.
Vice-Chair Gara spoke to UGF appropriations for the
department and AEA. He explained that since the FY 15
management plan, AEA had been receiving $4.6 million UGF.
Currently, AEA was receiving $874,000, which represented an
81 percent reduction. He stressed AEA was the state's only
energy agency, which was responsible for keeping power
systems running in rural Alaska, consulted with power
systems around the state and on energy efficiency and cost
reduction. He added that DCCED had been cut by 75 percent
since FY 15.
Representative Wilson wondered why $125,000 had been
budgeted for the area [of instate travel] if it was needed
in other areas within the agency. She wondered why the
funds had not been put in the other areas where needed.
Ms. Reardon responded that the department did not really
budget at the level of the dozens and dozens of codes. The
department primarily watched the main line items that were
seen by legislators including personal services, travel,
contractual, commodities, and grants. The department did
not build its budgets from the ground up every year - it
spent its time trying to manage by looking at bigger
movements because the system allowed moving money between
sub-line items. She explained that the department did not
necessarily spend time deciding how much it would spend on
books and postage, but on how much it had to provide for
the services to the public in general. She believed it was
true across departments. She added it was not a new thing.
Representative Wilson countered that the money under
consideration was in travel. She remarked that Ms. Reardon
was saying that the money was not needed in travel but that
it had been needed in another area. She stated that the
committee was not allowed to "do a 2 percent or a 1
percent," so the only choice members had was to look to see
where the money was spent and where it had been in the
past. She reiterated that the money had been allocated for
travel, but it sounded like the agency needed the money
elsewhere. She thought Ms. Reardon was saying that the
department did not look at its actuals down to "this
level." She surmised the department only looked at a bigger
picture and did not determine where it could save the money
on a smaller level.
Ms. Reardon stressed that the department did look at how it
could save money throughout the year, which was the reason
there was unspent funding. She clarified that it was not
UGF that Representative Wilson was looking at. She
explained the issue was not that the agency needed more UGF
in another category and moved it, it was that the funding
the department did not use was CIP receipts or other
funding sources. She underscored that the department could
not move the money anywhere else; it had merely not been
spent because the department did not have the capital
projects that used the money. In other words, the
legislature may have told DCCED it could spend $100,000 on
travel; it had only spent $25,000 because it was all the
money the department had from that funding source. She
furthered that if the legislature told the department it
could spend $100,000 and it spent $50,000, it was not that
$50,000 UGF could be taken, it was that $50,000 of the
unspent CIP receipts could be taken without impacting the
department's activities compared to FY 17. She clarified
that the funding source mattered; if the funding source had
been uncollectible, the department could not spend it.
2:52:51 PM
Representative Wilson thought Ms. Reardon was saying that
even though the department did not need the money where it
was, it may need it elsewhere; therefore, it wanted to keep
it where it was.
Ms. Reardon replied in the negative. She explained that it
had not been UGF money in the first place; it was hollow
authority (money the department did not have) in CIP
receipts.
Representative Wilson commented the department must have
substantial hollow authority.
Representative Guttenberg MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Wilson, Pruitt, Thompson, Tilton
OPPOSED: Gara, Grenn, Guttenberg, Kawasaki, Ortiz, Foster,
Seaton
The MOTION to adopt Amendment H CED 7 FAILED (4/7).
2:54:23 PM
AT EASE
3:03:04 PM
RECONVENED
Representative Wilson MOVED to ADOPT Amendment H CED 8
(copy on file):
Alaska Energy Authority
Alaska Energy Authority Rural Energy Assistance
H CED 8 - 3011: Other Services
Offered by Representative Wilson
FY17 Actuals were $252.2 and the FY 19 Governor's
budget request is $582.0. A decrement of $100.0 will
result in a FY 19 budget request of $482.0 for other
professional services which is $229.8 more than FY 17
actual expenditures.
Representative Guttenberg OBJECTED.
Representative Wilson read the amendment description [see
above]. She added that when she looked up the UGF and what
had been spent she had made sure whatever had been in
personnel services had been taken out first.
Representative Guttenberg confirmed that the money had been
spent. He stated it was the same dialogue as with the
previous amendment about where the appropriate funding
sources were - whether it was UGF or capital improvement or
how they used it.
Representative Wilson stated the department was responsible
for knowing where it spent the money.
Representative Guttenberg MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson, Ortiz
OPPOSED: Grenn, Guttenberg, Kawasaki, Gara, Seaton, Foster
The MOTION to adopt Amendment H CED 8 FAILED (5/6).
3:06:02 PM
Representative Guttenberg MOVED to ADOPT Amendment H CED 9
(copy on file):
Regulatory Commission of Alaska
Regulatory Commission of Alaska
H CED 9 - Broadband Mapping
Offered by Representative Guttenberg
Wordage: It is the intent of the legislature that the
Regulatory Commission of Alaska produce a map of
broadband coverage in the state, using the best
available GIS data and technology. The Regulatory
Commission of Alaska shall deliver a report
summarizing mapping efforts and results to the Speaker
of the House, the President of the Senate, the Co-
Chairs of the House Finance Committee, the Co-Chairs
of the Senate Finance Committee, and the Legislative
Finance Division, by January 1, 2019.
Explanation: On December 1st, 2017, the RCA released
its legislative report on Alaska's current and future
broadband coverage in response to intent language in
the FY18 operating budget. This amendment directs the
RCA to follow up on those efforts and continue
developing maps that help determine the extent of
broadband coverage in Alaska.
There being NO OBJECTION, Amendment H CED 9 was ADOPTED.
3:06:25 PM
Representative Wilson MOVED to ADOPT Amendment H DOC 6
(copy on file):
Population Management
Institution Director's Office
H DOC 6 - 3001 Financial Services
Offered by Representative Wilson
FY17 Actuals were $19.2 and the FY 19 Governor's
budget request is $226.7 for management and consulting
services. A decrement of $100.0 will result in a FY 19
budget request of $126.7 which is $107.5 over FY 17
actual expenditures.
Representative Kawasaki OBJECTED.
Representative Wilson read the amendment description [see
above].
Representative Kawasaki asked what the decrement would do
to the management and consulting services that were
requested.
Representative Wilson replied the amendment would control
how much the department could spend on the items.
Representative Kawasaki spoke to his objection. He reported
that the total agency under the Institution Director's
Office was $1.75 million including $137,000 in federal
receipts. Just over $20,000 had come in under federal
receipts in the last fiscal year. Without more explanation
on how the reduction would harm or help the budget, he
thought the amendment could harm the federal receipt
funding source. He referenced a sheet from OMB that stated
an analysis of expenditures at the object class level was
insufficient to determine if there was authority available
for reductions. Without further explanation of what the
amendment would do he advised members to vote no. He
MAINTAINED his OBJECTION.
3:08:18 PM
Representative Wilson believed the better question was why
the department had only spent $19,200 in FY 17 and now it
needed $226,700. She could not find a reason for such a
large increase.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Guttenberg, Kawasaki, Ortiz, Gara, Grenn, Foster,
Seaton
The MOTION to adopt Amendment H DOC 6 FAILED (4/7).
3:09:34 PM
Representative Tilton MOVED to ADOPT Amendment H DOC 7
(copy on file):
Offender Habilitation
Vocational Education Programs
H DOC 7 - Decrement
Offered by Representative Tilton
Reduce to 2017 final numbers accounting for CPI.
Representative Kawasaki OBJECTED.
Representative Tilton explained the amendment. She detailed
the prison system population was decreasing. Although she
was supportive of training, the increment was an increase
of almost $200,000. She did not understand why the budget
for training was increasing for incarcerated individuals
when the population was declining.
Representative Kawasaki asked if the reduction was based on
the final budget or actuals.
Representative Tilton replied that the amendment was based
on 2017 finals and increased for inflation.
3:10:31 PM
Representative Wilson was in support of the amendment. She
believed it would incentivize the department for using
treatment centers outside of the institutions. There had
been significant subcommittee discussion about Medicaid
expansion. Whether a person liked Medicaid expansion was
irrelevant. She stated that if the incarcerated individuals
were in halfway housing or on electronic monitoring they
would be picked up by the federal government and the state
may have better, more efficient programs. She had not heard
anything in subcommittee demonstrating how successful the
system was, but she had heard the recidivism rate was still
over 65 percent. She believed the high rate indicated many
of the current programs were not working.
Co-Chair Seaton asked to hear from the Department of
Corrections (DOC) about the impact of the reduction.
APRIL WILKERSON, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF CORRECTIONS (via teleconference),
replied that it would mean reduced funding for inmate
vocational education training services currently provided
within the institutions. The budget had been stagnant over
the last several years at $606,000. She reported that in
the FY 17 actuals the department had spent $521,500.
Representative Ortiz remarked on the amendment sponsor's
point that the overall prison population had been
declining. He asked if the proposed amendment would result
in less available educational opportunities for inmates
based on the decline in the inmate population.
Ms. Wilkerson replied that DOC would need to take a look at
what level and what was currently provided to determine
whether it would be a reduction in the service or the types
of vocational education provided versus a reduction in the
number of individuals that could attend the training
services.
Representative Wilson asked if the department offered
vocational training anywhere but in institutions. She
wondered why the department did not offer training in other
places.
Ms. Wilkerson replied in the negative; the vocational
certification was completed within DOC facilities. She
reported that DOC was currently working on a work-release
type of program, such as the cannery in Kenai.
Representative Wilson asked who provided the services (i.e.
contractors or other) and how many had signed up and
successfully completed the training.
Ms. Wilkerson replied that she did not have the numbers on
hand. She detailed that the vocational education training
was provided through contracts and partnership agreements.
She offered to follow up with the program numbers.
Representative Wilson asked if the training could be
provided via another method such as in a halfway house or
through an ankle monitoring system where the individual
received training from the University or the Alaska
Vocational Technical Center (AVTEC).
Ms. Wilkerson believed the commissioner was working on
implementing those types of options.
3:15:37 PM
Representative Kawasaki opposed the amendment. He stated
that the actual budget numbers for FY 17 were $521,500. He
pointed out that the number would be closer to $538,000
when adjusted for inflation. The amendment would decrease
the amount by $107,300, bringing the allocation total to
$498,700, which was short of the FY 17 actual by about
$23,000 or $38,000 when adjusted for inflation. He believed
it was unwise to cut offender rehabilitation. He remarked
there had been good programs that had been very successful.
He reported that a former co-chair of the House Finance
Committee had spoken highly of the work being done in Mat-
Su as well as in the Seward woodworking shop. He believed
the state could lose those types of programs if the
amendment was adopted.
Representative Wilson corrected that DOC had not been able
to provide detail on which programs were or were not
working. She stated the information would have been very
helpful when considering the amendment.
Co-Chair Seaton remarked that it was up to the person
offering the amendment to know the impact, otherwise the
committee would have to assume the impacts.
Representative Wilson replied that she and her colleagues
had asked and had received little to no response out of
agencies. She stated that to get something on time [from
agencies] was almost impossible.
Representative Pruitt tried to recall whether (prior to
2017) agencies had participated in the same capacity. He
stated if the discussion was that members should not be
asking questions of the departments, he did not have a
problem with that, but he believed it should be consistent.
He thought perhaps the members around the table should be
the ones to argue for or against items instead of bringing
agencies in to defend their budget.
Representative Tilton agreed with the comments by
Representative Pruitt. She believed that if amendment
sponsors were expected to provide the information that
perhaps departments should not be asked to respond to any
questions. She spoke to the amendment and shared there had
been a decrease in [prison] population. The numbers were
based on final FY 17 information increased for inflation.
She stated there were no success metrics and there were
other opportunities.
3:19:40 PM
Representative Kawasaki MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Kawasaki, Ortiz, Gara, Grenn, Guttenberg, Seaton,
Foster
The MOTION to adopt Amendment H DOC 7 FAILED (4/7).
Co-Chair Seaton MOVED to ADOPT Amendment L H DOE 3 (copy on
file):
K-12 Aid to School Districts
Foundation Program
L H DOE 3 - School consolidation hold harmless for
FY19 and FY20
Offered by Representative Seaton
See 30-GH2564O.29
The current Foundation statutes provide for a hold
harmless provision in AS 14.17.410(b)(1)(E) which
provides a step-down process if a district's total
school size adjusted average daily membership (ADM)
decreases by 5% or more from one year to the next.
This provision provides a three-year step down of
funds for schools that rapidly lose students.
However, other school districts that have seen less
dramatic enrollment declines could still save money by
consolidating schools. The current School Size Factor
in statute would cause districts that did this to lose
state aid, offsetting the savings.
This amendment would grant an an amount equal to the
funding reduction to the school district in FY19, so
the school district is held harmless immediately after
the school consolidation. This provision is limited to
consolidation of schools within a single community,
ensuring that this does not cause districts to close
the sole school in a community. The language also
includes intent language that the legislature will
include similar language in the budget next year,
giving districts additional time to prepare.
There is no change to the budget. Any grant given by
this language would be offset by a reduction to the K-
12 foundation formula.
Representative Pruitt OBJECTED for discussion.
Co-Chair Seaton read the amendment description [see above].
Vice-Chair Gara stated the amendment would benefit his
school district with consolidation. However, he wondered if
the funds would come out of the foundation formula from
money available from other schools.
Co-Chair Seaton replied in the negative. He detailed the
amendment involved a UGF grant that offset the reduction
that would be seen through the foundation formula so that
the school district that consolidates would be held
harmless in the year of consolidation.
Vice-Chair Gara remarked that the amendment showed zero
cost, but he surmised there would probably be some cost in
grants, which was not yet known.
Co-Chair Seaton replied in the negative. He explained there
was an offset cost. Prior to consolidation, the schools
would have been getting a school size factor in two
schools. When two schools consolidated into one with a
larger cost size, there would be a loss of revenue to the
district because the consolidated school was larger and it
had less money coming from the cost size. Some money was
saved in administration (i.e. there was no need for two
principals). The amendment specified that if a school
consolidated for efficiency, the state would give the
school a grant (in the year of consolidation) to make up
the difference. The amendment encouraged consolidation and
efficiency, whereas, the current system incentivized
districts to leave two schools in place where populations
had been reduced.
3:24:34 PM
Vice-Chair Gara supported the amendment. He noted it was a
quirk in the education foundation formula. He elaborated
that the amendment helped his district; however, it would
never help the Lake and Peninsula School District where
there was one school per community. He understood the
amendment could only address the one issue, but he hoped
the legislature would "do right" by all of the state's
schools by the end of session.
Representative Ortiz testified in support of the amendment.
He reported that the Department of Education and Early
Development (DEED) budget subcommittee had discussed the
issue. He elaborated that representatives from the
Anchorage area had communicated that the current education
formula acted as a disincentive for consolidation. He
believed the amendment at least partially addressed the
issue.
Representative Pruitt clarified that Anchorage was the
district grappling with how to manage its funds. He
reported the district's population had decreased in the
past few years and was continuing to decrease by small
amounts. The district had underutilized schools and they
had not been able to truly look at the best way to manage
their funds in terms of pulling a school offline
temporarily or long-term because the funding formula
penalized districts for that action. He believed the
amendment provided a temporary stopgap solution. He thought
the discussion forced the legislature to analyze how the
formula funding potentially discouraged or encouraged
efficient utilization of funds. He recognized it was a
future conversation. He believed the amendment was an
appropriate way to handle the issue on a temporary basis.
He WITHDREW his OBJECTION.
There being NO further OBJECTION, H DOE 3 was ADOPTED.
3:28:01 PM
Representative Wilson MOVED to ADOPT Amendments H DOE 4, H
DOE 5, H DOE 6, H DOE 7 (copy on file):
Education Support and Admin Services
Student and School Achievement
H DOE 4 - 3001 Financial Services
Offered by Representative Wilson
FY17 Actuals were $545.2 and the FY19 Governor's
request is $1,115.0. This decrement of $200.0 will
result in a FY 19 budget request of $915.5 which is
$369.8 over FY 17 actual expenditures.
Education Support and Admin Services
Student and School Achievement
H DOE 5 - 3011 Other Services
Offered by Representative Wilson
FY17 Actuals were $5,374.5 and the FY19 Governor's
request is $6,449.4. A decrement of $250.0 in
professional activities will result in a FY 19 budget
request of $6199.4 which is $824.9 over FY 17 actual
expenditures.
Education Support and Admin Services
Student and School Achievement
H DOE 6 - 4000 Business
Offered by Representative Wilson
FY17 Actuals were $149.4 and the FY19 Governor's
request is $217.8. A decrement of $50.0 will result in
a FY 19 budget request of $167.8 which is $18.4 over
FY 17 actual expenditures.
Mt. Edgecumbe Boarding School
H DOE 7 - 3011 Other Services
Offered by Representative Wilson
FY16 Actuals were $299.9, FY 17 Actuals were $101.3
and the FY 19 Governor's request is $450.8 A decrement
of $100.0 will result in a FY 19 budget request of
$350.8 which is $249.5 over FY 17 actual expenditures
and $50.9 over FY 16 actual expenditures.
Representative Ortiz OBJECTED.
Representative Wilson read the amendment descriptions [see
above].
3:30:26 PM
Representative Ortiz emphasized that the student and school
achievement budget was 96 percent federally funded and only
3.2 percent GF funded. He detailed that $151 million of the
total $158 million student and school achievement budget
was federally funded ($5.1 million was GF funding). The
budget section had very little GF authorization and levered
GF funding to the hilt. He elaborated that GF funding was
needed to meet state obligations. He asked to hear from
DEED about the impact of the amendment.
3:31:48 PM
HEIDI TESHNER, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT,
confirmed that 95 to 96 percent of the student and school
achievement budget was federally funded. The proposed
reduction in UGF funding within the component would impact
a number of the department's state mandates and its
matching requirements. She deferred to a colleague for
additional detail.
PAUL PRASSING, DIRECTOR OF STUDENT LEARNING, DEPARTMENT OF
EDUCATION AND EARLY DEVELOPMENT, pointed out that the
amendment would be a reduction of about $500,000, which
would be another 10 percent reduction to the division's
budget. He elaborated that the division had lost over 20
staff and there had been a reduction of over 50 percent in
the past couple of years. The proposed UGF reduction would
significantly impact the component. He spoke to actuals
compared to the current spend and reported that much of it
related to an assessment contract shown in the [budget
code] 3001 line. He referenced $546,000 and explained there
had been two issues. There was an assessment contract the
division had negotiated with a vendor to complete.
Additionally, a new vendor had come on board. He expounded
that the billing in the fiscal year had not actually
occurred in FY 17 - it primarily impacted FY 18. He
explained the division also had a new five-year assessment
contract (with DRC), which the request matched. He
referenced the 3011 [code] line and communicated that the
large staff reductions had resulted in an increase in
contracts. He referenced the 4000 [code] and detailed the
division had increased its use of technology including
videoconferencing and sound system upgrades in conference
rooms to allow for web conferencing. He summarized that a
reduction of $500,000 would probably impact staff.
Vice-Chair Gara opposed the amendment. He stated that the
amendment would ask the department to budget in a way that
no business would budget. He shared that he was part owner
of a restaurant and provided a hypothetical scenario. He
detailed if the restaurant wanted to offer a new dish with
new ingredients and suddenly it had to replace all of its
dishware, the restaurant would not bring that on. He stated
the restaurant knew how much it could budget in a year, but
it did not know whether it would be spent on dishes,
glasses, services, raises, or other. He reported that
Education Support and Administrative Services had suffered
a 25 percent GF decrease (from $29.8 million to $22.3
million). He stressed that the student achievement
component had been cut by over 50 percent. Additionally,
executive administration had been cut. He stated the
appropriation had been heavily cut over the past few years
and he did not believe it was in the state's best interest
to cut it further.
Representative Ortiz asked for more information about the
impact of H DOE 7 related to the Mt. Edgecumbe Boarding
School.
3:36:31 PM
Ms. Teshner answered that Amendment H DOE 7 proposed a
reduction of $100,000 to the Public School Trust Funds for
the Mt. Edgecumbe Boarding School. She explained that the
reduction to the contractual line item would impact
contractual obligations of the department including
dormitory services, food management, and other management
related services. She pointed out that reducing $100,000 in
Public School Trust Fund funding would put the cost to the
foundation program; it did not represent a real reduction
to the overall budget because DEED had a projection from
the Department of Revenue for a set amount that went to the
foundation program or Mt. Edgecumbe.
Representative Wilson asked if "we" went into contractual
services and increased the services substantially.
Ms. Teshner answered that contractual services increased
with inflation every five years when negotiations occurred.
The department had recently done a request for proposal
(RFP) for its dormitory services contract for FY 19; there
was an increase anticipated that was not reflected in the
budget. She explained it would impact how much the
department would pay and the department would have to
reduce services elsewhere in Mt. Edgecumbe in order to pay
for the expected increases.
Representative Wilson did not know why DEED was negotiating
any kind of increases at present because the state did not
have the money. She did not think it made sense there were
contracts costing $299,000 in FY 16, dropping to $101,000
in FY 17, and increasing to $450,000 and higher. She
wondered why the department was increasing contractual
services during a budget deficit.
3:38:49 PM
Ms. Teshner answered that the department had tried to
negotiate with the contractor to bring the cost down, but
the contractor had personal services and other fixed cost
expenses as well that it could not reduce. The response to
the RFP had been very limited given Mt. Edgecumbe's
location in Sitka; there were limited companies that could
provide the service.
Representative Wilson asked why there had been several
contracts costing $300,000 in FY 16, only $101,000 in FY
17, and an anticipated increase of over $300,000 in FY 19.
Ms. Teshner did not have the specifics on hand. She offered
to follow up with the information.
Representative Wilson clarified that no portion of the
proposed reduction was GF match. The reduction would be
$4.8 million in UGF. She stated the reduction would not
impact personnel because she had made sure that all GF
currently allocated to personnel had remained in the
budget.
Representative Ortiz MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Ortiz, Gara, Grenn, Guttenberg, Kawasaki, Foster,
Seaton
The MOTION to adopt Amendments H DOE 4, H DOE 5, H DOE 6,
and H DOE 7 FAILED (4/7).
3:41:20 PM
Representative Pruitt MOVED to ADOPT Amendment H DEC 1
(copy on file):
Administration
State Support Services
H DEC 1 - Decrease in services.
Offered by Representative Pruitt
Decrease in services. Remaining amount is 17.5%
increase from the FY17actual to the FY19GovAdj.
Co-Chair Foster OBJECTED.
Representative Pruitt explained the amendment. He detailed
that the proposed budget reflected a 28.5 percent increase
over the actual from FY 17. He believed the increase was
far above what was necessary. The amendment would reduce
the increase to 17.5 percent for state support services.
Co-Chair Foster spoke to his objection. He stated that the
decrement would be an unallocated reduction to the
department. He detailed with prepared remarks:
As part of the FY 19 budget request, the department
transferred a total of $984,000 in multiple fund
sources from the administrative services allocation to
the state support services allocation related to the
cost associated with the Office of Information
Technology. So, this does not reflect an increase
across the division or the department, nor does this
reflect any change in services. In FY 18 the
department transferred eight IT positions to the
Department of Administration and the funding for these
positions shifted to the contractual line of the
department as reimbursable services agreement with the
Department of Administration to pay for the IT
services that were received. Transferring these
contractual costs to the state support services is in
line with how the department pays for other similar
contractual services. A reduction from savings from
the implementation of the Office of Information
Technology was included in the budget as a statewide
item and was anticipated that this would be spread
proportionally to all agencies.
If the department were to receive an additional
decrement of $278,000 GF in state support services,
the Department of Administration is going to have to
cover less of the department-wide overhead contractual
costs that include a portion of lease payments, charge
backs to DOA, telecommunications, IT, and human
resource support. These costs would instead need to be
borne by other divisions, which is funding that they
would otherwise spend on programmatic work and could
result in a reduction of services. Essentially, this
would be an unallocated reduction to the department.
For that reason, I would oppose the amendment.
3:44:28 PM
Representative Pruitt provided wrap up on the amendment. He
believed Co-Chair Foster had stated that in FY 18 there had
been a reduction in personnel and now the personnel were
being added back in. From the FY 17 actual to the FY 18
management plan, there was a reduction of around $200,000
to the particular line item. He stated the proposed budget
reflected an increase of $912,000 from the FY 18 management
plan as opposed to the $726,000 increased from the FY 17
actuals. He continued that if the argument to be made was
that there were additional employees, the legislature had
adjusted in FY 18 for the reduction in FY 17. He believed
the reduction was within reason. He reasoned that instead
of it being a 38.5 percent increase from FY 18 to FY 19, it
would still be an increase, albeit not as drastic. He
believed the amendment was reasonable.
Co-Chair Foster MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Gara, Grenn, Guttenberg, Kawasaki, Ortiz, Seaton,
Foster
The MOTION to adopt H DEC 1 FAILED (4/7).
3:47:01 PM
Representative Pruitt MOVED to ADOPT Amendment H DEC 2
(copy on file):
Environmental Health
Laboratory Services
H DEC 2 - Eliminate funding for Dairy Program.
Offered by Representative Pruitt
The state pays 100% of this program with no fees
generated to offset cost. There is currently only one
business benefiting from this service.
Co-Chair Foster OBJECTED.
Representative Pruitt explained that the amendment would
eliminate funding for the Dairy Program. He detailed there
was only one dairy in the state that utilized the program.
He elaborated that the dairy paid zero of the cost and the
state paid 100 percent. He reasoned if there was a need for
a business to have state government cover some of the cost,
it was appropriate for the business to participate in some
capacity. There were two employees that were not paid for
by the dairy. He believed it was reasonable to request fees
or to tell the dairy it was responsible for providing the
service.
Vice-Chair Gara asked where the program was located and
what no longer be provided if the program was eliminated.
Representative Pruitt believed it was located in the [Mat-
Su] Valley.
Vice-Chair Gara clarified his second question.
Representative Pruitt replied that two individuals tested
the [dairy] product to ensure its quality. He explained the
testing was required in order for the product to be sold in
to the military, prisons, or schools.
3:49:47 PM
Representative Ortiz asked for additional detail about the
dairy. He wondered if the dairy was safety testing for food
provided to schools.
Representative Pruitt replied that the dairy did no
testing. The Department of Environmental Conservation (DEC)
conducted the testing. He believed the testing should be
done by the farm.
Representative Ortiz asked what the dairy provided to the
state.
Representative Pruitt replied milk.
Co-Chair Seaton asked if the product was required to be
tested and certified by the state prior to being sold
commercially.
Representative Pruitt replied in the affirmative.
Co-Chair Foster confirmed there was currently one dairy,
but a second dairy was working to reopen. He provided
prepared remarks:
The Department of Environmental Conservation manages
the Alaska Dairy Regulatory Program in accordance with
the FDA's Grade A pasteurized milk ordinance. They do
that to ensure that milk and milk products are sold
and that commerce are manufactured and sold and
delivered in a safe and wholesome condition. The
pasteurized milk ordinance requires a licensed
veterinarian to oversee a regulatory program for the
inspection of animal health and care conditions at a
state's dairy farms, verification of sanitary
condition of the facility and equipment at milk
processing plants, and issuance of permits to dairy
farms, processing plants, and [indecipherable].
While the FDA provides approval of state dairy
programs, individual states that desire to have a
commercial dairy industry are expected to maintain
regulatory dairy programs in accordance with the
pasteurized milk ordinance. There is no federal dairy
program in place to support states where there is not
one. Without an FDA approved state program, commercial
dairy operations would be unable to sell dairy
products - milk, cheese, yogurt, butter - to
institutions that receive federal funds to subsidize
meal programs for military, schools, and prisons. If
this program were to go away, Alaska would be the only
state not actively operating a dairy program.
Not all of the costs would go away as a result of
eliminating the dairy program as most of the staff
working directly with the dairy is conducting the
testing. They also perform work that supports other
programs in the laboratory services components that
need to be maintained, including the office of the
state veterinary duties and regulatory testing for
other programs. Three to four positions would need to
be eliminated to meet this reduction and work would be
shifted among the remaining staff. There would be a
reduced capacity for the environmental health
laboratory to turn around regulatory testing and a
reduced ability to respond in the event of a food
borne illness outbreak.
Co-Chair Foster elaborated there were numerous
interconnected things involved and it was not as simple as
one may think. He opposed the amendment.
3:55:10 PM
Representative Wilson stated that it would help if the
state was not so over regulated. She mentioned a fish
processing plant in Fairbanks that went through the same
type of testing - the plant could not sell commercially
without the same type of testing. She emphasized that the
fish processing plant paid for all of the testing. She
questioned why one was subsidized and the other was not.
She stated that testing was required if the plants wanted
to stay in business. She continued that unfortunately the
state was over regulated, which was the reason there was
only one plant. She elaborated that the owner of the
processing plant would be thrilled if he could get all of
his testing done for free. She explained that the testing
was required by DEC and the FDA. She did not believe the
dairy program needed to go away, but she believed the
pertinent question was whether the state should pay for it.
She added that the fish plant was also responsible for
paying laboratory fees. She believed the required DEC and
FDA testing were duplicative.
Co-Chair Foster responded that the discussion about
charging fees was valid, but he believed the change would
have to be made statutorily. He did not recommend cutting
back the service at present. He opposed the amendment.
3:57:15 PM
Representative Pruitt provided wrap up on the amendment. He
stated that the conversation had highlighted that the
numbers provided by DEC may not be correct. He stated that
if the $400,000 may impact other programs, perhaps DEC was
not being clear about what it spent the money on. He
believed the legislature should have the conversation about
the dairy paying for the testing. He questioned whether the
dairy should be required to pay $400,000 if the money
covered more than the specific program. He wondered what
other areas the department was trying to shift money into
from the funds allocated to the dairy plant. He was
disturbed to find out the $400,000 was going to things
outside the dairy program. He stressed it was about truth
in budgeting. He stressed that if the dairy was ever
required to participate in paying for the testing, it
should not have to pay anything beyond the testing. He
firmly believed the dairy plant should be asked to
contribute. He reiterated his belief there was an error in
the department's reporting. He thought the public should be
concerned if the funding did not go to what DEC had
specified.
Co-Chair Foster MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Thompson, Tilton, Wilson, Grenn, Pruitt
OPPOSED: Gara, Guttenberg, Kawasaki, Foster, Seaton
Representative Ortiz was absent from the vote.
The MOTION to adopt H DEC 2 FAILED (5/5).
4:00:43 PM
Representative Wilson MOVED to ADOPT Amendment H DEC 3
(copy on file):
Air Quality
H DEC 3 - 3011: Other Services
Offered by Representative Wilson
FY 2017 Actuals were $345.7 and the FY 19 Governor's
budget request is $430.0. A decrement of $50.0 will
result in a FY 19 budget request of $380.0 to be used
for printing and professional services not listed in
other categories. This is an increase of $34.3 over FY
17 actual expenditures.
Co-Chair Foster OBJECTED.
Representative Wilson read the amendment description [see
above].
Co-Chair Foster opposed the amendment. He read from a
prepared statement:
In FY 17 the division had only lapsed a little over
$2,000 in funds and they expect that in FY 18 and FY
19 it will be about the same. So, there's not much
left over there. The increased other services in the
expenditure detail does not reflect an increase in UGF
spending; it's related to other collectable fund
sources. Of the $1.7 million that is in the component,
$1.426 million is required maintenance of effort for
federal awards. This leaves about $278,000 left over
when maintenance of effort funds are subtracted. The
division is already operating on a thin margin. The
department has indicated that a reduction of $50,000
would turn development of a regional haze state
implementation plan over to the EPA.
Co-Chair Foster did not support turning over state primacy
to the federal government on this and most other issues.
4:03:31 PM
Representative Wilson provided wrap up on the amendment.
She surmised that perhaps the maintenance of effort should
be match instead of just GF. She stressed that the state
was already shutting wood stoves down in Fairbanks due to
air quality. She reasoned that the EPA could not do
anything more to North Pole than the state had already
done. She reasoned turning the issue over to the federal
government may not be a bad idea. She remarked that
sometimes primacy was desired so the state could be nicer
to its residents, but she believed the state had forgotten
that. She explained the amendment was GF and did not take
away "any of the other people who are doing what they're
supposed to be doing." She believed the department did not
know what the money went to because the component was for
services not listed in other categories. She stressed the
legislature was responsible for letting people know where
the money was spent. She had learned during the meeting
that the numbers and categories did not matter. She thought
the legislature should consider the possibility that state
primacy ended up being more restrictive than the EPA.
Co-Chair Foster MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Tilton, Wilson, Grenn, Pruitt, Thompson
OPPOSED: Gara, Guttenberg, Kawasaki, Ortiz, Seaton, Foster
The MOTION to adopt H DEC 3 FAILED (5/6).
4:05:29 PM
Representative Pruitt MOVED to ADOPT Amendment H DEC 4
(copy on file):
Water
Water Quality Infrastructure Support & Financing
H DEC 4 - Reduces funding to the Ocean Ranger program.
Offered by Representative Pruitt
The merger of divisions and responsibilities in DEC
has increased the administrative burden on the
department.
Eliminating the funding for the Ocean Ranger program
will allow the Department to focus administrative
efforts on other measures such as safe and sustainable
sanitation and water facilities in Rural Alaska.
Co-Chair Foster OBJECTED.
Representative Pruitt explained the amendment would reduce
funding to the ocean ranger program. He clarified that the
amendment would not eliminate the $4.00 [per passenger]
charge that brought in about $3.9 million in the past year.
He believed the program was duplicative. He remarked that
the amendment should allow for more whales to be built or
other things that may be of interest to communities. He
elaborated that the amendment did not eliminate any
positions as they were contracted out. He furthered that
the contracted positions were not necessarily held by
Alaskans. He did not believe it made any sense to have a
duplicative program. Additionally, the amendment would
allow for a conversation in the future to consider whether
the tax should remain.
Co-Chair Foster opposed the amendment. He noted that the
ocean ranger program was mostly paid with fees. He read
from a prepared statement:
The ocean ranger program was established by a ballot
initiative. The measure not only requires the
department to place ocean rangers on board all large
cruise ships to act as independent observers to ensure
compliance with federal and state environmental
health, sanitation, and safety requirements, but it
also sets up the tax. Even if the budget authority for
the program is eliminated, the ocean ranger fee is in
statute and it will continue to be collected. The fee
is classified as an "other" fund source and it can't
be used for a non-designated purpose. Also, the
department would still be required by statute to run
the program. If it's the intent of the amendment to
eliminate the ocean ranger program, as was
acknowledged, it would have to be done by statute.
Representative Ortiz asked about the amendment sponsor's
statement that the ocean ranger program was duplicative. He
asked for further detail.
4:08:40 PM
Vice-Chair Gara spoke against the amendment. He objected to
the constant chipping away of a voter initiative. He
detailed that the voters passed a cruise ship head tax that
far exceeded in revenue the ocean ranger cost, which was
also approved by voters. He elaborated that the ocean
ranger program had already been scaled back and the cruise
ship tax had already been reduced. He had opposed all of
the measures that would have whittled away the voter
initiative.
Representative Pruitt provided wrap up. He explained that
DEC already had existing registration and sampling
programs. Additionally, the department worked with the
Coast Guard to regularly sample wastewater on cruise ships
and ferries. He elaborated that visible air emissions from
cruise ships were monitored. He believed the program was
another burden on the department. He thought it could be
argued that the department was doing an excellent job
monitoring potential violations. He thought the program was
duplicative. He agreed it was worth a conversation on
whether or not the tax should remain. He reasoned that the
funds could go out to various communities towards the other
aspects the head tax was allowed to be utilized for if the
program was eliminated.
Co-Chair Foster MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Wilson, Grenn, Pruitt, Thompson, Tilton
OPPOSED: Gara, Guttenberg, Ortiz, Foster, Seaton, Kawasaki
The MOTION to adopt H DEC 4 FAILED (5/6).
4:11:38 PM
AT EASE
4:23:38 PM
RECONVENED
Representative Wilson MOVED to ADOPT Amendment H DFG 5
(copy on file):
Commercial Fisheries
Southeast Region Fisheries Management
H DFG 5 - 3011: Other Services
Offered by Representative Wilson
FY16 Actuals $524.9 and FY19 Governor $826.0. A
decrease of $100.0 leaves $726.0 in environmental
conservation, economic development fees and other
services not yet determined.
Representative Ortiz OBJECTED.
Representative Wilson read the amendment description [see
above]. She understood that the division had spent all of
its money, but she did not believe it necessarily meant it
needed all of the money.
Representative Ortiz shared that he had participated in the
fishing industry as a commercial trawler with his dad years
back. He had always heard it said that the Department of
Fish and Game (DFG) did the best job in the world managing
the state's fisheries. He stressed that it required
financial investment to maintain that status. Since FY 15
the department's UGF had been cut by over 35 percent. He
referenced testimony in subcommittee about how the
department's ability to manage the state's fisheries to its
constitutional mandate to provide maximum sustainable
yield, had been reduced due to funding reductions. He
underscored it was a gamble the state could not afford. He
had the same argument about upcoming amendments. He
stressed that having the best industry in the world took
investment. The state's seafood industry was the number one
producer in the country; it was also a major worldwide
seafood producer. He expounded the industry was renewable
if it was managed well. He deferred to the department for
specific detail.
4:27:21 PM
SCOTT KELLEY, DIRECTOR, COMMERCIAL FISHERIES DIVISION,
DEPARTMENT OF FISH AND GAME (via teleconference), relayed
that the amendment would require significant cuts to the
Southeast Alaska fisheries component. He detailed it would
mean cutting red king crab and tanner crab surveys and cuts
to dive fisheries. He elaborated that some of the cuts
would mean the state would no longer have the specific
fisheries.
Representative Wilson asked what percentage commercial
fishermen paid to the fisheries management by DFG in
Southeast.
Mr. Kelley answered it depended on the fishery. Most of the
funds came from commercial crew licenses and limited entry
permittees, which were significant for the Southeast crab
fisheries. Additionally, there was revenue from landing and
raw fish taxes. He did not have the exact number on hand,
but he offered to follow up with the information as soon as
possible.
Representative Wilson asked how much the crab study was and
who the cost shifted to. She asked if the cost would shift
to crab fishermen.
Mr. Kelley answered that the crab fishery included the king
crab survey (costing about $85,000) and the tanner crab
survey (costing about $50,000), which were currently funded
with GF receipts. The surveys would not be conducted if DGF
did not have the GF.
4:30:12 PM
Representative Wilson asked if the costs could be charged
to individuals benefitting from them.
Mr. Kelley answered it had never been done in the past, but
he was not saying it could not be done. In the past, when
cuts had been made, the administration and the legislature
had provided for test fishing opportunity. In the case of
the crab surveys, population abundance for the crab species
was at a level that would be highly problematic to do a
fund swap to test fish. Additionally, it would come at a
significant cost to revenues and harvest.
Representative Ortiz provided additional detail about the
workings of test fisheries. He used the example of a test
fishery that would promote seine fishing in a particular
area. He detailed a test fishery was done for revenue to
make up for the lack of GF to support the particular data
collection. Consequently, fishermen stood by to allow the
test fishery and experienced lost opportunity. In order to
get the industry to pay for some of the test fishery
surveys, meant lost opportunity and cost to the fishermen.
Additionally, it meant less economic activity in the
overall economy, area, and less landing taxes.
Representative Ortiz MAINTAINED his OBJECTION.
Representative Wilson provided wrap up. She reminded the
committee that the department did not know which services
the money paid for because DFG had yet to determine the
services. She believed if the reduction shut down the
studies, the department would want to make sure the
legislature knew that. She reminded members the budget
included an increase to the component to $726,000. She did
not know why the legislature should allocate the money if
the department did not know what the money would be used
for. She referred to the prior conversation about dairies
and fish processors. She detailed the state required many
industries to pay to get up and running and continuing. She
surmised an industry's fair share seemed to vary between
industries.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Grenn, Guttenberg, Kawasaki, Ortiz, Gara, Seaton,
Foster
The MOTION to adopt H DFG 5 FAILED (4/7).
4:34:48 PM
Representative Wilson MOVED to ADOPT Amendment H DFG 6
(copy on file):
Commercial Fisheries
Central Region Fisheries Management
H DFG 6 - 3010: Equipment/Machinery
Offered by Representative Wilson
FY17 Actuals $114.1 and FY19 Governor $355.7. A
decrease of $100.0 leaves $255.7 for equipment rental
and maintenance services and equipment operator
charges.
Representative Ortiz OBJECTED.
Representative Wilson read the amendment description [see
above]. She added the amendment's proposed decrease of
$100,000 would leave $255,700 for the component, which was
over twice what had been spent in FY 17.
Representative Ortiz relayed that that he would not repeat
some of his arguments against the previous amendment, yet
some were applicable to H DFG 6. He referenced the idea
that industry should help pay for some of the assessments
and explained that industry did help pay in many ways. Not
only did industry pay a landing tax, there were also annual
license fees. The fish processors paid for specific
assessments to be conducted. He underscored that industry
did step forward and played a significant role in the
payment for services it received.
Representative Kawasaki noticed there were several
amendments related to equipment and machinery that used the
FY 17 actuals. He wondered if the amendment sponsor had
averages for the years mentioned. He reasoned there may be
a year where there was a big need for maintenance services
or equipment rental and the following year the cost was
down because the work had recently been done. He believed
the averages were more important than the actuals.
Co-Chair Seaton opposed the amendment. He relayed that the
subcommittee had done significant work with DFG and he
reported that the sub-allocation lines would vary from year
to year. The subcommittee had added money to the DFG budget
because the legislature had cut the department so far that
there had been foregone harvest, lost revenue, and lost tax
receipts from the fisheries. Overall there were a number of
amendments looking at items that fluctuated from year to
year. He believed the amendments would take away the
department's ability to move money within an allocation. He
continued that the message of the amendments was that if a
component went down or up from the prior year, the
legislature would take the money off the table. The problem
with the approach was that it did not look at the whole
picture. Whereas, the subcommittee had determined there
were foregone harvests and that fishery receipts and tax
had been lost.
4:39:25 PM
Representative Wilson provided wrap up. She clarified that
she had never stated that commercial fisheries did not play
a significant role or pay license and landing fees.
However, she believed the legislature expected many of the
areas to be cost neutral (e.g. boards and commissions,
doctors, real estate, and other) to keep the state whole,
yet there were other areas that did not have the same
expectation. She stated she would agree with the co-chair
if she was taking the numbers back to FY 17 actuals, but
she observed the gains were substantial - $400,000 to
$500,000 and up to several million dollars. She thought the
department should get closer to the correct expenditure
line if the goal was transparency. She thought small
fluctuations were acceptable, but the changes in the
component under consideration were not small.
Representative Wilson stated that many times departments
communicated they did not know what the money would be
spent on, which she found unacceptable. She had not been
able to get the answers from the department about the
percentage of the costs paid by the fishing industry. She
believed that as state revenue continued to decline, the
public would expect the legislature to ensure the industry
was paying for its own services. She thought that in the
cases of large increases in budget items that perhaps the
department was spending the funds elsewhere. She thought it
was necessary to put a squeeze on the agencies to get
closer to identifying what the money was spent on. She
relayed that she had not looked at an average, but she had
looked at several years to determine whether numbers were
consistent. She found the budget numbers to be consistent.
She pointed to the $355,700 and explained it had been the
number the two previous years. She thought it appeared the
department copied the budget from the year before and did
not pay attention to where the money was being spent. She
had seen that the budget numbers had been consistently the
same up to the current year. In the current budget process
she had seen many components going back to actuals, whereas
"other services" components appeared to be places where
departments put funds they did not know where else to put.
Representative Ortiz MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Guttenberg, Kawasaki, Ortiz, Gara, Grenn, Foster,
Seaton
The MOTION to adopt H DFG 6 FAILED (4/7).
4:42:32 PM
Representative Wilson MOVED to ADOPT Amendment H DFG 7
(copy on file):
Commercial Fisheries
Central Region Fisheries Management
H DFG 7 - 3011: Other Services
Offered by Representative Wilson
FY17 Actuals $277.5 and FY19 Governor $1,041.3. A
decrease of $200.0 leaves $841.3 for printing, copy,
transportation and consulting services, other services
not yet determined.
Representative Ortiz OBJECTED.
Representative Wilson reviewed the amendment description
[see above]. She stressed it was over three times the
amount of money (she had left in the component) from FY 17.
Representative Ortiz opposed the amendment. He underscored
DFG had been cut back by over 35 percent in UGF. He spoke
to the implication the amendments made that somehow the
department was not finding efficiencies. He remarked there
would have to have been a substantial amount of waste when
the department's budget was 35 percent higher otherwise,
the department had obviously had to find efficiencies. He
did not believe the legislature should delve down to
scrutinize the one area and claim efficiencies were not
occurring. He was very uncomfortable with the amendment. He
explained that it took financial investment to be able to
ensure the state had the best managed fisheries worldwide.
He thought the amendment was a step in the wrong direction.
Representative Pruitt wondered why the department would ask
for almost $700,000 more than had been used in FY 17. He
stated that the amendment would not reduce personnel and
pertained to printing, copy, transportation and consulting
services, and other services not yet determined. The
sponsor was highlighting that the department had requested
an increase of $700,000 UGF. He referenced Representative
Ortiz's testimony that the department's UGF budget had been
reduced. He believed if that were the case, the
department's proposal should have shown a reduction in the
component and an increase in another component if the money
was used elsewhere. He stated the amendment did not propose
to cut the entire amount - it would reduce the component by
$200,000 and leave $841,000 remaining. He reasoned the
remaining money would be almost $500,000 more than had been
used in FY 17. He stressed the department had only used
$277,000 [in FY 17]. He had not heard a reason to justify
why the amendment should not be passed.
Representative Ortiz asked to hear from the department
about the particular item.
4:47:12 PM
Mr. Kelley answered that any of the proposed cuts would
come at the expense of stock assessment projects put into
the field to assess fish populations including salmon,
crab, or groundfish. He had heard some of the committee's
questions about the industry supporting itself or
contributing to the state's economy. He offered to provide
the detail if the committee desired.
Co-Chair Seaton clarified that the committee was addressing
H DFG 7 pertaining to fisheries management.
Mr. Kelley communicated that a decrease of any amount to
the Central Region component would mean less stock
assessment, which in general meant less fishing
opportunity.
4:48:55 PM
Representative Ortiz had no further questions.
Representative Wilson provided wrap up. She reminded
members that hunting and fishing license fees had been
increased via legislation. She explained the funds came in
under DGF. Additionally, the state began receiving an
increase in [federal] Pittman Robertson funds when state
license fees had been increased. She explained that UGF had
been replaced with DGF. She reasoned it may look like a cut
to the department; however, the funds had been replaced
with other types of funds. She elaborated that the
department could not specify what its other not yet
determined services were that fell under the component. She
stated the department's testimony had pertained to surveys,
but the amendment was about printing, copying, and
transportation. She emphasized that over three times the
amount of money had been left in the component. She thought
the committee should have received a better explanation
from the department if the funds were truly needed.
Representative Ortiz MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Kawasaki, Ortiz, Gara, Grenn, Guttenberg, Seaton,
Foster
The MOTION to adopt Amendment H DFG 7 FAILED (4/7).
4:51:11 PM
Representative Wilson MOVED to ADOPT Amendment H DFG 8
(copy on file):
Commercial Fisheries
AYK Region Fisheries Management
H DFG 8 - 3011: Other Services
Offered by Representative Wilson
FY17 Actuals $417.7 and FY19 Governor $801.9. A
decrease of $200.0 leaves $601.9 for printing, copy,
transportation and consulting services.
Representative Ortiz OBJECTED.
Representative Wilson read the amendment description [see
above].
Co-Chair Seaton asked if Representative Wilson was using
total funds.
Representative Wilson replied she had used actuals for the
area and had considered whether the fund source was GF or
GF match and what was being utilized (after removing
personnel numbers).
Co-Chair Seaton asked for verification that it was total
funds.
Representative Wilson replied in the affirmative.
Co-Chair Seaton clarified that the amendment included
federal funds; therefore, if there was a shortage of
federal funds, it would mean cutting UGF because there were
not enough federal funds in FY 17 to fund the expenditure
so the expenditure was lower. He elaborated it would mean
taking UGF away because there had not been sufficient
federal funds received in FY 17 to make the actuals where
it would have been.
Representative Ortiz referred to the amendment sponsor's
remarks that Pittman Robertson funding had increased due to
license fee increases and therefore DFG really had not seen
a budget reduction. He underscored that the department
could not use Pittman Robertson generated funds for
commercial fishing activities - there were some narrow
windows where it was potentially allowable. He explained
that Pittman Robertson did not make up for UGF funding cuts
to commercial fishing.
4:53:59 PM
Co-Chair Seaton relayed that Pittman Robertson funds could
only be used for hunter access, trails, and wildlife
viewing. He clarified the funds could not be used for
commercial fishing.
Representative Wilson clarified that Representative Ortiz
kept talking about Department of Fish and Game in general.
Therefore, her response had been about GF used in the
department. Some of the department cuts had been replaced
by Pittman Robertson funds. She explained that much of the
discussion about recent amendments had pertained to the
department as a whole. She elaborated that Representative
Ortiz had provided numbers pertaining to the entire
department versus the specific component the amendments
pertained to.
Co-Chair Seaton asked to hear from the department about the
impact of the amendment.
CAROL PETRABORG, DIRECTOR, ADMINISTRATIVE SERVICES,
DEPARTMENT OF FISH AND GAME (via teleconference), replied
that in FY 18 the AYK Region component had lapse just over
$17,000 GF. There had been an increase in soft funding in
statutory designated program receipts to the Division of
Commercial Fisheries to replace prior GF reductions. She
explained that the funds did not always come through. It
had been anticipated the department would be spending more
money if the industry funds transpired. She expounded that
something that was not reflected in the components for
commercial fisheries was that in FY 18 the department
allocated out a facilities rent component that had
previously resided in Administrative Services to the
division in order for expenditures to be reflected in the
correct division. Therefore, over $1 million for commercial
fisheries was not reflected in the FY 17 actuals; it had
been done in the FY 18 budget.
Co-Chair Seaton asked for clarification that the
reallocation of the rent receipts had increased the
division's budget and it would carry through to FY 19. He
surmised it was a reallocation of funds that had been
previously reported on another line in the budget.
Ms. Petraborg replied in the affirmative. The funds had
previously been recorded within the Administrative Services
Division.
4:58:15 PM
Representative Wilson provided wrap up. She did not know
how the $1 million fit into the amendment - she was not
clear on whether the division had gained or lost the money.
She did not believe the numbers came out right either way.
She opined the department should have a better explanation
of the funding need if the large increase was important.
She reasoned if the division needed $1 million, the
component was only $800,000, which did not make sense. She
questioned whether the department knew where it was
spending the money.
Representative Ortiz MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Ortiz, Gara, Grenn, Guttenberg, Kawasaki, Foster,
Seaton
The MOTION to adopt H DFG 8 FAILED (4/7).
4:59:44 PM
HB 285 was HEARD and HELD in committee for further
consideration.
HB 286 was HEARD and HELD in committee for further
consideration.
Co-Chair Seaton reviewed the agenda for the following day.
The committee would continue budget amendments during its
next meeting.
ADJOURNMENT
5:00:12 PM
The meeting was adjourned at 5:00 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Hb 285 HB 286 Op Budget Amendment-Packet.pdf |
HFIN 3/5/2018 1:30:00 PM |
HB 285 HB 286 |
| HB 286 OMB FY2019 Amendments Based on Actuals.pdf |
HFIN 3/5/2018 1:30:00 PM |
HB 286 |
| HB 286 HB 285 Amendments with Actions as of 3-5-18.pdf |
HFIN 3/5/2018 1:30:00 PM |
HB 285 HB 286 |