Legislature(2019 - 2020)ADAMS ROOM 519

01/30/2020 01:30 PM FINANCE

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Audio Topic
01:34:04 PM Start
01:34:59 PM HB205 || HB206
01:35:30 PM Fy 21 Budget Overview: Department of Revenue
02:20:55 PM Presentation: Savings Funds Update and Cash Flow Deficiency Plan
03:40:59 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Savings Funds Update & Cash Flow Deficiency Plan TELECONFERENCED
Dept. of Revenue
+= HB 205 APPROP: OPERATING BUDGET/LOANS/FUNDS TELECONFERENCED
Heard & Held
+= HB 206 APPROP: MENTAL HEALTH BUDGET TELECONFERENCED
Heard & Held
+ FY21 Dept. Budget Overview: Dept. of Revenue TELECONFERENCED
                  HOUSE FINANCE COMMITTEE                                                                                       
                     January 30, 2020                                                                                           
                         1:34 p.m.                                                                                              
                                                                                                                                
1:34:04 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Foster  called the House Finance  Committee meeting                                                                    
to order at 1:34 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Neal Foster, Co-Chair                                                                                            
Representative Jennifer Johnston, Co-Chair                                                                                      
Representative Dan Ortiz, Vice-Chair                                                                                            
Representative Ben Carpenter                                                                                                    
Representative Andy Josephson                                                                                                   
Representative Gary Knopp                                                                                                       
Representative Bart LeBon                                                                                                       
Representative Kelly Merrick                                                                                                    
Representative      Colleen       Sullivan-Leonard      (via                                                                    
teleconference)                                                                                                                 
Representative Cathy Tilton                                                                                                     
Representative Adam Wool                                                                                                        
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Mike Barnhill,  Acting Commissioner, Department  of Revenue;                                                                    
Brad Ewing, Administrative  Services Director, Department of                                                                    
Revenue,  Office  of  Management   and  Budget;  Pam  Leary,                                                                    
Director, Treasury Division, Department of Revenue.                                                                             
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Carol  Beecher, Director,  Child Support  Services Division,                                                                    
Department  of   Revenue;  Colleen  Glover,   Director,  Tax                                                                    
Division,  Department  of  Revenue;  Representative  Colleen                                                                    
Sullivan-Leonard.                                                                                                               
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 205    APPROP: OPERATING BUDGET/LOANS/FUNDS                                                                                  
                                                                                                                                
          HB 205 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
HB 206    APPROP: MENTAL HEALTH BUDGET                                                                                          
                                                                                                                                
          HB 206 was HEARD and HELD in committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
FY 21 BUDGET OVERVIEW: DEPARTMENT OF REVENUE                                                                                    
                                                                                                                                
PRESENTATION: SAVINGS FUNDS UPDATE and CASH FLOW DEFICIENCY                                                                     
PLAN                                                                                                                            
                                                                                                                                
1:34:59 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster reviewed the meeting agenda.                                                                                    
                                                                                                                                
HOUSE BILL NO. 205                                                                                                            
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     loan  program  expenses  of state  government  and  for                                                                    
     certain    programs;    capitalizing   funds;    making                                                                    
     appropriations under art.  IX, sec. 17(c), Constitution                                                                    
     of the State of  Alaska, from the constitutional budget                                                                    
    reserve fund; and providing for an effective date."                                                                         
                                                                                                                                
HOUSE BILL NO. 206                                                                                                            
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     capital    expenses   of    the   state's    integrated                                                                    
     comprehensive mental health  program; and providing for                                                                    
     an effective date."                                                                                                        
                                                                                                                                
1:35:18 PM                                                                                                                    
                                                                                                                                
^FY 21 BUDGET OVERVIEW: DEPARTMENT OF REVENUE                                                                                 
                                                                                                                                
1:35:30 PM                                                                                                                    
                                                                                                                                
MIKE BARNHILL, ACTING COMMISSIONER, DEPARTMENT OF REVENUE,                                                                      
introduced himself and was available for any questions                                                                          
throughout the presentation.                                                                                                    
                                                                                                                                
BRAD EWING, ADMINISTRATIVE  SERVICES DIRECTOR, DEPARTMENT OF                                                                    
REVENUE,  OFFICE  OF  MANAGEMENT   AND  BUDGET,  provided  a                                                                    
PowerPoint  presentation   titled  "FY21   Operating  Budget                                                                    
Overview    Department   of    Revenue:   Core    Divisions:                                                                    
Presentation to the House  Finance Committee," dated January                                                                    
30, 2020  (copy on  file). He  shared that  the presentation                                                                    
would focus primarily on divisions  within the Department of                                                                    
Revenue  (DOR).  He began  on  slide  2, "Mission  and  Core                                                                    
Programs":                                                                                                                      
                                                                                                                                
     Mission: To collect, distribute, and invest funds for                                                                      
     public purposes                                                                                                            
                                                                                                                                
     ? Core Divisions                                                                                                           
          ? Tax Division: Collect                                                                                               
          ? Treasury Division: Invest                                                                                           
          ? Permanent Fund Dividend Division: Distribute                                                                        
          ? Child Support Services Division: Collect and                                                                        
          Distribute                                                                                                            
                                                                                                                                
     ? Support and Oversight Functions                                                                                          
          ? Commissioner's Office                                                                                               
          ? Administrative Services Division                                                                                    
          ? IT sections in divisions                                                                                            
          ? Criminal Investigations Unit                                                                                        
                                                                                                                                
Mr. Ewing advanced to slide 3, "Department Overview":                                                                           
                                                                                                                                
       -$25.1M (-6 percent) from FY19 to FY21                                                                                   
       -18 positions (-2 percent) from FY19 to FY21                                                                             
                                                                                                                                
     Significant Changes                                                                                                        
          ? Tax: +$1.65M to fund TRMS in operating budget                                                                       
          ? Tax: $571.6 fund source change (CIP to UGF)                                                                         
          ? ARMB: -$5M for management fees                                                                                      
          ? APFC: -$21.1M for management fees                                                                                   
                                                                                                                                
1:41:26 PM                                                                                                                    
                                                                                                                                
Mr. Ewing reviewed slide 4, "Funding Sources":                                                                                  
                                                                                                                                
     ? UGF and DGF represent 8 percent of DOR's non-                                                                            
     duplicated budget authority                                                                                                
                                                                                                                                
     ? AHFC, AMHTA, and APFC represent 68 percent of DOR's                                                                      
     non-duplicated budget authority                                                                                            
                                                                                                                                
Mr. Ewing moved to slide 5, "Tax Division":                                                                                     
                                                                                                                                
     ? +$1,351.9 (+9 percent) and -3 positions (-3 percent)                                                                     
     from FY20 to FY21                                                                                                          
                                                                                                                                
     ? Key budget items: +$1.65M to fund TRMS in operating                                                                      
     budget, $571.6 fund source change (CIP to UGF)                                                                             
                                                                                                                                
Mr. Ewing advanced to slide 6, "Treasury Division":                                                                             
                                                                                                                                
     ? +$5.8 (+0 percent) and no change in position counts                                                                      
     from FY20 to FY21                                                                                                          
                                                                                                                                
    ? Org. restructure to create middle office function                                                                         
                                                                                                                                
1:45:35 PM                                                                                                                    
                                                                                                                                
Mr. Ewing moved to slide 7, "Unclaimed Property":                                                                               
                                                                                                                                
     ? +$1.0 (+0 percent) and no change in position counts                                                                      
     from FY20 to FY21                                                                                                          
                                                                                                                                
Acting  Commissioner Barnhill  elaborated  on  slide 9.  The                                                                    
slide was  showing the trend  for total investment  costs to                                                                    
total  assets.   He  explained  that  1   percentage  of  an                                                                    
investment fund  was equal  to 100  basis points.  The slide                                                                    
showed a  fee comparison between ARMB,  the Alaska Permanent                                                                    
Fund Corporation (APFC), and Treasury.                                                                                          
                                                                                                                                
Representative Wool  recalled from subcommittee  meetings in                                                                    
years past that the ARMB  and APFC invested differently, but                                                                    
had  similar performance.  He wondered  whether that  was an                                                                    
accurate assessment.                                                                                                            
                                                                                                                                
Acting Commissioner  Barnhill answered that  the comparisons                                                                    
in terms of investment returns  changed, and noted the 3, 5,                                                                    
and 10-year periods since inception  of the funds. He stated                                                                    
that  2019 had  been an  incredible year  for investment  in                                                                    
capital   and   fixed   income.  The   department   reported                                                                    
investment  returns  on  a  fiscal year  basis,  but  for  a                                                                    
calendar  year  he felt  confident  saying  that most  funds                                                                    
returned 20 percent in 2019.                                                                                                    
                                                                                                                                
Representative   Wool  remarked   that  they   were  managed                                                                    
differently.  He noted  that the  management fees  in FY  19                                                                    
were about the  same, but were slightly different  in FY 21.                                                                    
He stated that "you get what you pay for."                                                                                      
                                                                                                                                
Acting  Commissioner  Barnhill  answered  that  the  pension                                                                    
system had recently  gone through a fairly  major shift, and                                                                    
the changing methodologies would occur  to get the change in                                                                    
performance over long periods of time.                                                                                          
                                                                                                                                
Co-Chair Johnston noted that  the governor's proposed budget                                                                    
took $21.1  million decrement for  the management  fees. She                                                                    
asked whether it was a policy statement.                                                                                        
                                                                                                                                
Acting Commissioner  Barnhill stressed  that slide  9 showed                                                                    
the total picture of the investment management fees.                                                                            
                                                                                                                                
Co-Chair Johnston  clarified her  question. She asked  if it                                                                    
was a result of the board's decision.                                                                                           
                                                                                                                                
Acting  Commissioner Barnhill  replied  that the  department                                                                    
had no involvement in the decision.                                                                                             
                                                                                                                                
Co-Chair  Johnston  asked about  the  policy  impact on  the                                                                    
board's decision.                                                                                                               
                                                                                                                                
Acting Commissioner  Barnhill answered that the  only policy                                                                    
involvement  in  the board's  budget  was  a request  for  a                                                                    
certain type of salary.                                                                                                         
                                                                                                                                
Co-Chair Johnston stated it was an incentive salary.                                                                            
                                                                                                                                
1:56:03 PM                                                                                                                    
                                                                                                                                
Representative Josephson  understood the difference  in fees                                                                    
borne  by  and fees  appropriated  by.  He asked  about  the                                                                    
recent $5 million veto.                                                                                                         
                                                                                                                                
Acting  Commissioner  Barnhill  did not  have  a  sufficient                                                                    
granular concept  of what the  $5 million  veto encompassed.                                                                    
All  of  the   fees  were  based  on  a   basis  point  when                                                                    
appropriating a  dollar figure it  was not specific  to what                                                                    
was  actually  paid.  It  was   possible  to  be  using  the                                                                    
governor's  veto authority  to  drive investment  management                                                                    
policy, but he did not believe it had ever been exercised.                                                                      
                                                                                                                                
Co-Chair  Johnston stated  they  would  want the  investment                                                                    
management  fees to  rise in  order  to increase  investment                                                                    
returns.                                                                                                                        
                                                                                                                                
Acting Commissioner Barnhill agreed.                                                                                            
                                                                                                                                
Co-Chair Johnston hope  that the management of  the fund was                                                                    
cognizant  of the  basis  points, and  in  a good  bartering                                                                    
position.  She noted  that APFC  would present  [at a  later                                                                    
date].                                                                                                                          
                                                                                                                                
1:59:01 PM                                                                                                                    
                                                                                                                                
Mr.  Ewing  turned to  slide  10,  "Permanent Fund  Dividend                                                                    
Division":                                                                                                                      
                                                                                                                                
       -$498.8 (-6 percent) and -6 positions from FY20 to                                                                       
     FY21                                                                                                                       
     ? Continue to reduce services costs and shift towards                                                                      
     online applications                                                                                                        
                                                                                                                                
Mr.  Ewing advanced  to slide  11,  "Child Support  Services                                                                    
Division":                                                                                                                      
                                                                                                                                
       -$218.0 (-1 percent) and no change in position count                                                                     
     from FY20 to FY21                                                                                                          
     ? Continue to reduce services costs                                                                                        
                                                                                                                                
Representative Knopp  noted Mr.  Ewing's statement  that the                                                                    
Child Support Services Division was  the largest in terms of                                                                    
staff, and he queried the budget for that division.                                                                             
                                                                                                                                
Mr. Ewing  answered that in  FY 21, the  governor's proposed                                                                    
budget was $25.7 million                                                                                                        
                                                                                                                                
Representative  Knopp  asked  whether  70  percent  of  that                                                                    
number was federally funding.                                                                                                   
                                                                                                                                
Mr. Ewing replied in the affirmative.                                                                                           
                                                                                                                                
Representative  Knopp asked  if they  only distributed  what                                                                    
they collected.                                                                                                                 
                                                                                                                                
Acting   Commissioner   Barnhill   answered   the   division                                                                    
collected federal  money, and did  not collect the  money to                                                                    
distribute. He  noted the director was  available online for                                                                    
questions.                                                                                                                      
                                                                                                                                
Representative Knopp asked about  the number in the previous                                                                    
year.                                                                                                                           
                                                                                                                                
CAROL  BEECHER, DIRECTOR,  CHILD SUPPORT  SERVICES DIVISION,                                                                    
DEPARTMENT  OF  REVENUE  (via teleconference),  replied  the                                                                    
division had collected $105 million in the past year.                                                                           
                                                                                                                                
2:03:22 PM                                                                                                                    
                                                                                                                                
Representative  Wool noted  the one  position in  Fairbanks,                                                                    
and a  facility he assumed  was closed in Wasilla.  He asked                                                                    
about  the facility,  and  whether  it was  a  place like  a                                                                    
storefront where people went into.                                                                                              
                                                                                                                                
Acting  Commissioner Barnhill  replied that  the offices  in                                                                    
Anchorage were located in the Atwood Building.                                                                                  
                                                                                                                                
Ms. Beecher  added that the  division did an  extensive look                                                                    
at what  was causing  people to need  to visit  the offices,                                                                    
but there  was no  real need  for individuals  to physically                                                                    
visit the  offices. The services were  available online. The                                                                    
goal was to  improve services so that no one  needed to walk                                                                    
through  the doors.  There were  online appointments  people                                                                    
could make, most of which took place on the phone.                                                                              
                                                                                                                                
Representative  Wool wondered  whether it  was possible  for                                                                    
people to visit the building.                                                                                                   
                                                                                                                                
Ms. Beecher replied in the affirmative.                                                                                         
                                                                                                                                
2:05:59 PM                                                                                                                    
                                                                                                                                
Representative  Josephson noted  that the  use CSSD  to help                                                                    
with  accounting  was in  order  to  prevent any  contention                                                                    
about what was paid.                                                                                                            
                                                                                                                                
Mr. Ewing reviewed the administration  and support budget on                                                                    
slide 12.                                                                                                                       
                                                                                                                                
Mr. Ewing  turned to slides  13 and 14 showing  changes from                                                                    
the FY 21 adjusted base.                                                                                                        
                                                                                                                                
Vice-Chair Ortiz  looked at  line 3 on  slide 13  related to                                                                    
the consolidation of the Fish  Tax Group into the Excise Tax                                                                    
Group.                                                                                                                          
                                                                                                                                
COLLEEN  GLOVER,  DIRECTOR,   TAX  DIVISION,  DEPARTMENT  OF                                                                    
REVENUE  (via teleconference),  looked at  line item  3. She                                                                    
shared that  there had  been open  positions for  quite some                                                                    
time  and there  had  been difficulty  with recruiting.  The                                                                    
person in the Juneau position had left.                                                                                         
                                                                                                                                
2:11:10 PM                                                                                                                    
                                                                                                                                
Vice-Chair Ortiz asked how the change benefitted taxpayers.                                                                     
                                                                                                                                
Ms. Glover  answered that the  benefit from  her perspective                                                                    
was that two of the  three employees were filled by existing                                                                    
tax money, which already were familiar with the system.                                                                         
                                                                                                                                
Vice-Chair Ortiz  recalled the previous year  there had been                                                                    
discussion  about removing  the local  share of  landing and                                                                    
fish  taxes  from  communities.   He  wondered  whether  the                                                                    
landing taxes were a part of the fish taxes                                                                                     
                                                                                                                                
Ms. Glover  answered that the  Fish Tax Group  would process                                                                    
the fish  landing tax returns,  and the Accounting  Group in                                                                    
Juneau handled the revenue sharing.                                                                                             
                                                                                                                                
Acting Commissioner  Barnhill added that there  were two tax                                                                    
types: the fisheries landing tax  and the fisheries business                                                                    
tax.  He remarked  that there  was  a recent  administration                                                                    
proposal to  end the 50  percent revenue sharing.  He stated                                                                    
that the proposal was not pursued in the current year.                                                                          
                                                                                                                                
Vice-Chair  Ortiz   wondered  whether  the   accounting  was                                                                    
conducted in Juneau.                                                                                                            
                                                                                                                                
Ms. Glover answered in the  affirmative. The accounting team                                                                    
was all located in Juneau.                                                                                                      
                                                                                                                                
Representative  Wool  looked at  line  5  on slide  13,  and                                                                    
wondered whether  it related to  the reduction  in authority                                                                    
to reflect management fee savings.                                                                                              
                                                                                                                                
Acting Commissioner Barnhill replied in the affirmative.                                                                        
                                                                                                                                
2:15:05 PM                                                                                                                    
                                                                                                                                
Representative Wool  looked at line  12 on slide  14 related                                                                    
to staff retention. He asked if  it was related to the bonus                                                                    
structure.                                                                                                                      
                                                                                                                                
Acting Commissioner  Barnhill replied  in the  negative. The                                                                    
bonus retention program was not included in the budget.                                                                         
                                                                                                                                
2:16:43 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Ortiz  wondered if  the  fish  taxes were  going                                                                    
under   excise  taxes,   whether   there   would  be   clear                                                                    
delineation between  the times.  He was concerned  the money                                                                    
would go into excise taxes.                                                                                                     
                                                                                                                                
Acting Commissioner Barnhill replied in the affirmative                                                                         
                                                                                                                                
Ms. Glover added the proposal  was an organizational change,                                                                    
and the  information would continue  to be available  in the                                                                    
system.                                                                                                                         
                                                                                                                                
Mr. Ewing summarized the presentation on slide 15:                                                                              
                                                                                                                                
     Efficiency gains in Tax, PFD, and Child Support                                                                            
     Services Divisions results in reductions of -$1,174.2                                                                      
     | -3 PFT, -6 PPT                                                                                                           
                                                                                                                                
     Tax -$346.6 UGF | -3 PFT                                                                                                   
                                                                                                                                
     PFD Division -$527.6 Other | -6 PPT                                                                                        
                                                                                                                                
   Child Support Services -$102.0 GF Match, -$198.0 Fed                                                                         
                                                                                                                                
     ARMB Custody and Management Fees reduction of -                                                                            
     $5,000.0 Other                                                                                                             
                                                                                                                                
     Reducing uncollectable authority in Admin and Support                                                                      
     results in reductions of -$631.5                                                                                           
                                                                                                                                
     Tax Revenue Management System (TRMS) maintenance and                                                                       
     support $2,221.6 UGF, -$571.6 CIP                                                                                          
                                                                                                                                
Representative Josephson asked if  ARMB had taken a position                                                                    
on the reduction of management fees.                                                                                            
                                                                                                                                
Acting  Commissioner  Barnhill  replied  that  decisions  on                                                                    
management fees were  made entirely by ARMB.  The change was                                                                    
not and had never been driven by the executive branch.                                                                          
                                                                                                                                
Representative  Carpenter  noted  there  were  a  number  of                                                                    
positions  that  had  been  eliminated.   He  asked  if  the                                                                    
department still had the staff needed to do the work.                                                                           
                                                                                                                                
Acting Commissioner Barnhill replied in the affirmative.                                                                        
                                                                                                                                
^PRESENTATION:   SAVINGS   FUNDS   UPDATE  and   CASH   FLOW                                                                  
DEFICIENCY PLAN                                                                                                               
                                                                                                                                
2:20:55 PM                                                                                                                    
                                                                                                                                
Acting Commissioner Barnhill noted  that his colleague would                                                                    
provide   the   presentation    and   he   would   interject                                                                    
occasionally.  He  provided  an introduction  prior  to  the                                                                    
presentation. He spoke to the  volatility in revenue tied to                                                                    
oil  prices. He  highlighted  two types  of volatility.  The                                                                    
state  had  historically   used  the  Constitutional  Budget                                                                    
Reserve  (CBR) as  a  way to  address  revenue shortage.  He                                                                    
believed there  was a great  degree in interest  to identify                                                                    
the minimum cushion needed in  the CBR to maintain the fund.                                                                    
The state had a several year  practice as using the CBR as a                                                                    
source of  recurring revenue  and not a  rainy day  fund. As                                                                    
long as the CBR was drained,  it would not be available as a                                                                    
rainy day fund. He noted  the need to address the structural                                                                    
deficit;  there  was no  minimum  cushion  if the  fund  was                                                                    
continually used to fund the deficit.                                                                                           
                                                                                                                                
2:26:06 PM                                                                                                                    
                                                                                                                                
Representative Josephson asked about a specific proposal.                                                                       
                                                                                                                                
Acting Commissioner Barnhill  stated that the administration                                                                    
did not  have a  specific proposal, but  it had  also stated                                                                    
that everything  was on  the table -  including a  change to                                                                    
the PFD formula, new revenues  - particularly in the form of                                                                    
a sales tax with a  change to the constitution, and spending                                                                    
reductions.                                                                                                                     
                                                                                                                                
2:29:25 PM                                                                                                                    
                                                                                                                                
Co-Chair  Johnston   took  Acting   Commissioner  Barnhill's                                                                    
comments seriously. She spoke  about formula driven programs                                                                    
- the largest  was for the dividend. She  discussed that the                                                                    
outcome   of  the   current  year   could  limit   what  the                                                                    
legislature did the following year.                                                                                             
                                                                                                                                
Acting Commissioner  Barnhill answered  that if  nothing was                                                                    
done  to  address the  structural  deficit,  there would  be                                                                    
major  issues and  the  balance  of the  CBR  would be  $500                                                                    
million.  Regardless  of  the  discussion,  the  number  was                                                                    
likely too low.                                                                                                                 
                                                                                                                                
Co-Chair Johnston  stated that the proposals  to address the                                                                    
situation  would likely  not come  into  effect for  several                                                                    
years.                                                                                                                          
                                                                                                                                
Acting  Commissioner Barnhill  noted  they  would begin  the                                                                    
presentation to address the questions.                                                                                          
                                                                                                                                
2:32:29 PM                                                                                                                    
                                                                                                                                
PAM  LEARY,  DIRECTOR,   TREASURY  DIVISION,  DEPARTMENT  OF                                                                    
REVENUE, provided  a PowerPoint presentation  titled "Update                                                                    
on the State's Rainy Day  Funds and Discussion of State Cash                                                                    
Flows," dated January 30, 2020  (copy on file). She began on                                                                    
slide 3  titled "FY21  Days that Alaska  could run  on Total                                                                    
Balances  (Rainy Day  and Other  Funds)." She  remarked that                                                                    
the slide did not include  the Permanent Fund Dividend (PFD)                                                                    
amount. She  remarked that the  CBR would include  about six                                                                    
months  of coverage  of the  operating budget.  She remarked                                                                    
that there were many ways  to determine the appropriate size                                                                    
of a rainy day fund.                                                                                                            
                                                                                                                                
Co-Chair Johnston  wondered whether  there was  an inclusion                                                                    
of the full draw on the  headroom, or only what was budgeted                                                                    
in the year prior.                                                                                                              
                                                                                                                                
Ms. Leary answered that they  were expected cash balances at                                                                    
the beginning of FY 21.                                                                                                         
                                                                                                                                
Co-Chair Johnston remarked that  the number was after earned                                                                    
income and court settlements.                                                                                                   
                                                                                                                                
Acting  Commissioner Barnhill  furthered  that  the CBR  was                                                                    
historically used as a structural backdrop.                                                                                     
                                                                                                                                
Co-Chair  Foster queried  the reason  for the  difference in                                                                    
the $100 million between the forecasts.                                                                                         
                                                                                                                                
Ms. Leary stated it was only an estimate.                                                                                       
                                                                                                                                
Representative  Wool asked  if the  exercise was  a standard                                                                    
metric done by other states [slide 4].                                                                                          
                                                                                                                                
Acting Commissioner Barnhill referenced  reports done by the                                                                    
Pew Trust  on rainy day  funds. The  reports came up  with a                                                                    
suggestion that states  should base the size  of their rainy                                                                    
day  funds on  revenue  volatility. Alaska  had the  highest                                                                    
revenue volatility, consequently it  needed a high rainy day                                                                    
fund balance.                                                                                                                   
                                                                                                                                
Representative Wool  reasoned that  the pipeline  could stop                                                                    
flowing.                                                                                                                        
                                                                                                                                
Acting  Commissioner  Barnhill  discussed  that  five  years                                                                    
earlier they were on a  countdown clock. He stressed had not                                                                    
taken a shutdown of the  pipeline, but a decrease in revenue                                                                    
to start to examine the rainy day fund structure.                                                                               
                                                                                                                                
2:38:59 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Ortiz asked  if  the  calculation of  volatility                                                                    
factored into the tax regime established under SB 21.                                                                           
                                                                                                                                
Acting Commissioner Barnhill answered in the affirmative.                                                                       
                                                                                                                                
Co-Chair Foster asked the committee  whether it preferred to                                                                    
hold questions.                                                                                                                 
                                                                                                                                
Representative Josephson  suggested holding  questions until                                                                    
after the presentation.                                                                                                         
                                                                                                                                
Acting  Commissioner  Barnhill  suggested  that  they  would                                                                    
introduce the concept of volatility management.                                                                                 
                                                                                                                                
2:40:25 PM                                                                                                                    
                                                                                                                                
Ms. Leary moved to slide 5 and reviewed the CBR fund:                                                                           
                                                                                                                                
     Constitutional Budget Reserve Fund                                                                                         
                                                                                                                                
     In 1990, voters  of Alaska adopted an  amendment to the                                                                    
     constitution   creating   the   CBRF.  The   fund   was                                                                    
     established  as  a  savings   fund  to  enhance  budget                                                                    
     stability.   Consists   of  deposits   resulting   from                                                                    
     resolutions  of disputes  about the  amount of  mineral                                                                    
     lease bonuses, royalties, or taxes.                                                                                        
                                                                                                                                
     Legislature may appropriate from the CBRF to fund                                                                          
     operations under certain conditions:                                                                                       
                                                                                                                                
          Simple  majority  vote  if  available  funds  from                                                                    
          other  sources are  less than  amount appropriated                                                                    
          to fund  state government for the  previous fiscal                                                                    
          year.                                                                                                                 
                                                                                                                                
          Otherwise 3/4s vote.                                                                                                  
                                                                                                                                
     Borrowings   are  allowed   to   fund  temporary   cash                                                                    
     deficiencies and  budget shortfalls as  appropriated by                                                                    
     the legislature.                                                                                                           
                                                                                                                                
     Borrowings must be  repaid to the CBRF when  there is a                                                                    
    surplus in the general fund at the end of the year.                                                                         
                                                                                                                                
     As  of  FY10, the  CBRF  was  repaid and  no  borrowing                                                                    
     occurred FY 11-FY14.                                                                                                       
                                                                                                                                
     A  Sub-fund of  the CBRF  was established  in 2000.  In                                                                    
     2008, $4.1 B was deposited  (1.5 CBRF Main + $2.6B from                                                                    
     GF). Sub  Fund was  liquidated in  2015 as  required by                                                                    
     statute  as  funds were  deemed  to  be needed  with  5                                                                    
     years.                                                                                                                     
                                                                                                                                
Ms. Leary moved to a graph showing the CBR historical                                                                           
invested assets.                                                                                                                
                                                                                                                                
Ms. Leary highlighted slide 8, "Power Cost Equalization":                                                                       
                                                                                                                                
     The purpose  of the  PCE Endowment  fund is  to provide                                                                    
     for a  long-term stable financing source  that provides                                                                    
     affordable   levels  of   electric  utility   costs  in                                                                    
     otherwise high-cost service areas of the state.                                                                            
                                                                                                                                
     5 percent  of the monthly  average market value  of the                                                                    
     fund   for  the   previous  3   fiscal  years   may  be                                                                    
     appropriated.  If  prior  year's earnings  exceed  this                                                                    
     amount,  70  percent  (not  to   exceed  $55M)  of  the                                                                    
     difference   can  be   spent   on  related   identified                                                                    
     programs.  Commerce is  the  agency  that oversees  the                                                                    
     spending  of  the  fund.  SB196,  effective  6/30/2016,                                                                    
     changed  the  spending  target  from  7  percent  to  5                                                                    
     percent.                                                                                                                   
                                                                                                                                
     Fund History:                                                                                                              
                                                                                                                                
          2000-Power Cost Equalization Endowment Fund                                                                           
          established from Constitutional Budget Reserve                                                                        
          Appropriation of $100 million                                                                                         
                                                                                                                                
          2002-PCE receives $89.6 million from proceeds of                                                                      
          the sale of the four dam pool hydroelectric                                                                           
          project.                                                                                                              
                                                                                                                                
          2007-Additional appropriation of $182.7 million                                                                       
                                                                                                                                
          2012-Additional appropriation of $400 million                                                                         
                                                                                                                                
Ms. Leary  moved to  slide 9  showing how  the PCE  fund had                                                                    
grown.  Slide  10  showed  how the  fund  was  invested  and                                                                    
balances.                                                                                                                       
                                                                                                                                
Ms. Leary turned  to slides 11 related to  the Alaska Higher                                                                    
Education Investment  Fund. She noted that  slides 12 showed                                                                    
the  balances  of  the  fund  and  the  targeted  investment                                                                    
allocation. The balance  reference the amount at  the end of                                                                    
December.                                                                                                                       
                                                                                                                                
Ms. Leary moved to slide 14, "GeFONSI I and II":                                                                                
                                                                                                                                
     ?  GeFONSI  includes the  General Fund  and Other  Non-                                                                  
     segregated funds  invested in a pooled  environment (GF                                                                    
     proper= $400 million).                                                                                                     
                                                                                                                                
     ?  Department of Administration separately accounts for                                                                  
     each fund within State Accounting system.                                                                                  
                                                                                                                                
     ?  Department of  Revenue is responsible  for investing                                                                  
     the  GeFONSI  and   calculating  and  allocating  daily                                                                    
     investment earnings to each fund.                                                                                          
                                                                                                                                
     ?  185 funds,  assigned as Types  1, 2,  or 3.   Type 1                                                                  
     funds receive their earnings, the others do not.                                                                           
                                                                                                                                
     ?  GeFONSI II  was created in  2018 to target  a higher                                                                  
     risk return profile and includes  funds that are type 2                                                                    
     or 3.                                                                                                                      
                                                                                                                                
2:46:39 PM                                                                                                                    
                                                                                                                                
Ms. Leary  turned to slide 16  showing the GeFONSI I  and II                                                                    
target asset  allocations. She total  fund balance  was $2.6                                                                    
billion.                                                                                                                        
                                                                                                                                
Representative  Merrick  asked  if  the  administration  was                                                                    
planning to eliminate any of the funds.                                                                                         
                                                                                                                                
Acting Commissioner  Barnhill asked  if she was  speaking to                                                                    
PCE.                                                                                                                            
                                                                                                                                
Representative Merrick  replied she  was speaking  about the                                                                    
GeFONSI.                                                                                                                        
                                                                                                                                
Acting Commissioner Barnhill replied  that the answer was no                                                                    
to both questions.                                                                                                              
                                                                                                                                
Representative Wool  surmised that  the GeFONSI  referred to                                                                    
the investments in the general fund.                                                                                            
                                                                                                                                
2:48:34 PM                                                                                                                    
                                                                                                                                
Ms.  Leary  answered  that the  $2.6  billion  consisted  of                                                                    
general fund, but was a subset as a working capital.                                                                            
                                                                                                                                
Representative  Wool surmised  it  was the  funds that  were                                                                    
dispersed   and  not   dedicated,  and   the  rest   was  an                                                                    
investment.                                                                                                                     
                                                                                                                                
Ms. Leary answered in the affirmative.                                                                                          
                                                                                                                                
Acting Commissioner Barnhill  noted there was a  list of all                                                                    
of the funds the department could provide.                                                                                      
                                                                                                                                
Co-Chair Foster requested the information.                                                                                      
                                                                                                                                
Representative Merrick asked if all  of the funds in GeFONSI                                                                    
were subject to the reverse sweep.                                                                                              
                                                                                                                                
Ms. Leary answered in the negative.                                                                                             
                                                                                                                                
2:50:50 PM                                                                                                                    
                                                                                                                                
Representative  Merrick  asked if  the  list  of funds  that                                                                    
would be  provided by DOR  indicated whether the  funds were                                                                    
subject to the reverse sweep.                                                                                                   
                                                                                                                                
Ms. Leary answered they could provide the information.                                                                          
                                                                                                                                
Acting  Commissioner  Barnhill  addressed  slide  18  titled                                                                    
"Alaska has  the highest Tax Revenue  Volatility." According                                                                    
to Pew,  Alaska had the  highest tax revenue  volatility. He                                                                    
stressed that the composition of  the state's volatility had                                                                    
changed.  The  general  fund  revenues  were  no  longer  80                                                                    
percent of volatile commodity.                                                                                                  
                                                                                                                                
2:56:04 PM                                                                                                                    
                                                                                                                                
Representative Carpenter asked if there  was any way to show                                                                    
what volatility  may be with different  revenue options such                                                                    
as sales tax or other.                                                                                                          
                                                                                                                                
Acting  Commissioner Barnhill  answered in  the affirmative.                                                                    
The department could model  different scenarios. He remarked                                                                    
that if they  were not going to make  any structural changes                                                                    
there was  no minimum cushion -  the CBR would just  be used                                                                    
for the fund.                                                                                                                   
                                                                                                                                
Vice-Chair Ortiz  asked if  a strategy  were built  to allow                                                                    
the  Permanent Fund  to reach  $100 billion,  the volatility                                                                    
would decline, based on the 5 percent POMV draw.                                                                                
                                                                                                                                
Acting  Commissioner  Barnhill  answered that  in  the  POMV                                                                    
formula there was a lagging  formula using the first five of                                                                    
the past six years.                                                                                                             
                                                                                                                                
3:00:23 PM                                                                                                                    
                                                                                                                                
Representative  LeBon spoke  to the  need for  money in  the                                                                    
ERA.                                                                                                                            
                                                                                                                                
Acting  Commissioner  Barnhill  answered  that  the  obvious                                                                    
solution  was to  convert the  account to  an endowment.  He                                                                    
remarked  that a  similar  discussion  had occurred  several                                                                    
years earlier.                                                                                                                  
                                                                                                                                
Acting  Commissioner  Barnhill  looked  at  various  revenue                                                                    
techniques available to manage volatility on slide 20.                                                                          
                                                                                                                                
3:04:24 PM                                                                                                                    
                                                                                                                                
Acting Commissioner  Barnhill moved to cash  flow volatility                                                                    
on slide 22.                                                                                                                    
                                                                                                                                
Ms. Leary  reviewed a pictorial  of the  treasury's incoming                                                                    
cash flow including tax  revenues, federal dollars, earnings                                                                    
reserve funds,  and agency receipts.  She moved to  the cash                                                                    
management  objectives  on  slide 23  including  maintaining                                                                    
adequate liquidity ($400  million), optimize cash resources,                                                                    
safeguard state assets, and record financial activity                                                                           
affecting cash.                                                                                                                 
                                                                                                                                
Co-Chair Johnston asked when the greatest cash need took                                                                        
place throughout the year.                                                                                                      
                                                                                                                                
Ms. Leary answered  that the beginning of  the year required                                                                    
significant cash. She remarked  that the department had made                                                                    
changes  in the  past couple  of years  including a  move to                                                                    
quarterly payments.                                                                                                             
                                                                                                                                
Ms. Leary advanced to slide 24, "Cash vs. Accrual                                                                               
balances":                                                                                                                      
                                                                                                                                
     ?  Cash balance is what you have in the bank at a given                                                                  
     point in time.                                                                                                             
                                                                                                                                
     ?  Accrual  balance takes  into account  what you  have                                                                  
     earned  and   when  a  liability   is  incurred   at  a                                                                    
     particular point  in time. It  is what you  should have                                                                    
     at  a  particular  point in  time  after  all  expected                                                                    
     receipts and expenditures come in and out.                                                                                 
                                                                                                                                
     ?  Simple  example: Your  bank balance  shows you  have                                                                  
     $1,000 in cash  on July 31. However, you  know that you                                                                    
     wrote checks  for utilities  on July  25 for  $400 that                                                                    
     are for July  utilities that have not  yet cleared. You                                                                    
     may  have also  earned a  paycheck of  $1,200 for  work                                                                    
     performed  in July.  Your accrual  balance  on July  31                                                                    
     would be $1,800.                                                                                                           
                                                                                                                                
Ms. Leary turned to slide 25, "Cash Flow Deficiencies":                                                                         
                                                                                                                                
     ?  Prior  to  1985, most  unrestricted revenues  flowed                                                                  
     into and stayed in the General Fund for expenditure.                                                                       
                                                                                                                                
     ?  Over  time,  the  legislature has  established  many                                                                  
     subfunds  to  segregate  cash for  budgeting  purposes,                                                                    
     resulting  in less  cash  available  to pay  day-to-day                                                                    
     operating costs.                                                                                                           
                                                                                                                                
     ?  Expenditures can occur prior to  receipt of revenue,                                                                  
     resulting in a cash flow deficit:                                                                                          
          ? Federal programs require expenditures before                                                                      
          reimbursement.                                                                                                        
               ? i.e. Medicaid, Transportation, etc                                                                           
          ? Beginning of year appropriation transfers do                                                                      
          not match incoming revenue.                                                                                           
                                                                                                                                
Ms. Leary looked at slide 26, "Cash Flow Deficiencies":                                                                         
                                                                                                                                
     ? Borrowing from budget reserve funds has been the                                                                       
     solution of both cash shortages (cash flow deficits)                                                                       
     and revenue shortfalls (budget deficits).                                                                                  
                                                                                                                                
     ? During FY93-FY05, the legislature included language                                                                    
     in the appropriation act permitting borrowings from                                                                        
     budget reserve funds.                                                                                                      
                                                                                                                                
     ? The CBRF was fully repaid by FY10.                                                                                     
                                                                                                                                
     ? Borrowing from the CBRF recommenced in FY14                                                                            
                                                                                                                                
     ? Per FY18 CAFR $9.9B is owed to CBR                                                                                     
                                                                                                                                
Ms. Leary turned to slide 27, "Cash Deficiency Memorandum                                                                       
of Understanding":                                                                                                              
                                                                                                                                
     ? Original MOU signed 1994 by DOR, DOA, OMB and LAW.                                                                     
                                                                                                                                
     ? Updated December 1, 2017.                                                                                              
                                                                                                                                
     ? Targets $400m dollar minimum threshold.                                                                                
                                                                                                                                
     ?    Outlines    procedures    for   addressing    cash                                                                  
     deficiencies:                                                                                                              
                                                                                                                                
          ? Develop monthly cash projections.                                                                                 
          ? Monitor daily general fund cash balances.                                                                         
          ? Transfer from SBR, CBR and ERA as appropriated.                                                                   
          ? Perform temporary interfund borrowing.                                                                            
          ? Borrow from general fund sub funds, if                                                                            
          temporary                                                                                                             
          ? If all appropriations/borrowing are exhausted:                                                                    
               ?   Seek   legislative  action   through  the                                                                  
               Governor to  access additional  funds through                                                                    
               appropriation  from  other  Rainy  Day  Funds                                                                    
               discussed above.                                                                                                 
               ?    Prioritize    disbursements,    restrict                                                                  
               expenditures.                                                                                                    
                                                                                                                                
3:12:24 PM                                                                                                                    
                                                                                                                                
Ms.  Leary advanced  to slide  29 and  reviewed a  bar chart                                                                    
showing historic  actual cash inflows  and outflows  from FY                                                                    
17 to FY 19.  She pointed to the blue portion  of the bar in                                                                    
FY 19 showing the ERA draw.                                                                                                     
                                                                                                                                
Ms.  Leary  turned  to  slide 32  and  addressed  the  daily                                                                    
General   Fund   sufficiency    balance   calculation.   The                                                                    
calculation  started  with the  GF  cash  balance minus  the                                                                    
payments outstanding and cash  receipts in suspense to equal                                                                    
the available  GF cash. She  turned to  a graph on  slide 34                                                                    
showing the  General Fund sufficiency  from July 1,  2019 to                                                                    
December 31, 2019.                                                                                                              
                                                                                                                                
Co-Chair Johnston  knew two years  did not provide  a frame.                                                                    
She asked if the information  was available for the previous                                                                    
year as well.                                                                                                                   
                                                                                                                                
Ms. Leary answered they could provide the information.                                                                          
                                                                                                                                
Co-Chair Johnston understood and noted  Ms. Leary had done a                                                                    
good  job  explaining  the  need   for  cash  draws  at  the                                                                    
beginning of  a year.  She asked  about the  specific stress                                                                    
factors to the CBR.                                                                                                             
                                                                                                                                
Ms. Leary  agreed to provide  the information. She  moved to                                                                    
slide  35 showing  GF sufficiency  from January  1, 2020  to                                                                    
June   30,  2020.   The  remainder   of  the   chart  showed                                                                    
projections  - the  information changed  daily. Much  of the                                                                    
trends were based  on the prior year  6-month snapshot based                                                                    
on what was paid out.                                                                                                           
                                                                                                                                
3:19:28 PM                                                                                                                    
                                                                                                                                
Co-Chair  Johnston asked  if the  projection  factored in  a                                                                    
sizeable supplemental budget.                                                                                                   
                                                                                                                                
Ms. Leary described  the information as money  coming in and                                                                    
coming out.                                                                                                                     
                                                                                                                                
Acting Commissioner  Barnhill stated that  his understanding                                                                    
was the charts included the supplemental.                                                                                       
                                                                                                                                
Co-Chair  Johnston asked  for verification  that the  charts                                                                    
included the headroom.                                                                                                          
                                                                                                                                
Acting Commissioner Barnhill replied in the affirmative.                                                                        
                                                                                                                                
Co-Chair   Johnston   spoke    about   fast   tracking   the                                                                    
supplemental.                                                                                                                   
                                                                                                                                
Acting Commissioner  Barnhill replied that  the differential                                                                    
would draw the starting balance down.                                                                                           
                                                                                                                                
Co-Chair Johnston felt that there  should be a consideration                                                                    
of the departments potential snapshot the following day.                                                                        
                                                                                                                                
3:21:19 PM                                                                                                                    
                                                                                                                                
Co-Chair  Foster   asked  how  the  department   dealt  with                                                                    
situations  where the  actual was  not as  simple. He  asked                                                                    
what would  happen if  the governor added  $1,400 for  a PFD                                                                    
supplemental.                                                                                                                   
                                                                                                                                
Ms. Leary answered that the  department paid close attention                                                                    
to what  was happening. She  remarked that the  $400 million                                                                    
floor  allowed  for  flexibility to  situations  that  would                                                                    
result in a larger than anticipated payout.                                                                                     
                                                                                                                                
Acting Commissioner Barnhill stated  that the purpose of the                                                                    
chart on slide 35 was to time cash flows.                                                                                       
                                                                                                                                
Representative  Josephson noted  that there  was a  veto the                                                                    
previous  summer of  about $450  million.  He remarked  that                                                                    
there  only about  $222 million  had been  restored, so  the                                                                    
remaining funds remained in the GeFONSI.                                                                                        
                                                                                                                                
Acting Commissioner Barnhill answered  that he needed to see                                                                    
the exact composition of the veto dollars.                                                                                      
                                                                                                                                
Representative  Josephson asked  whether the  administration                                                                    
would welcome further statutory reform.                                                                                         
                                                                                                                                
Acting   Commissioner   Barnhill   answered   that   similar                                                                    
questions  had come  up when  DOR made  the presentation  to                                                                    
SFC.                                                                                                                            
                                                                                                                                
3:25:42 PM                                                                                                                    
                                                                                                                                
Representative  Josephson  asked  about the  draws  and  the                                                                    
headroom issue. He wondered if headroom was included.                                                                           
                                                                                                                                
Acting Commissioner Barnhill responded  that he had used the                                                                    
term, "back  stop." Headroom had a  specific amount attached                                                                    
to it.                                                                                                                          
                                                                                                                                
Co-Chair  Johnston   suggested  that  all  of   the  factors                                                                    
discussed in  the previous  10 minutes  are factored  in the                                                                    
volatility of the cash flow.                                                                                                    
                                                                                                                                
Acting   Commissioner   Barnhill    agreed   with   Co-Chair                                                                    
Johnston's comment.                                                                                                             
                                                                                                                                
Representative Carpenter  was hesitant to ask  his question.                                                                    
He  wondered  about two  lines  that  tracked similarly.  He                                                                    
wondered why  the two lines  did not track and  wondered why                                                                    
that was the case.                                                                                                              
                                                                                                                                
Ms. Leary  responded that she though  the representative was                                                                    
slightly in the  weeds. However, she noted that  it may have                                                                    
been that spending was higher in that specific timeframe.                                                                       
                                                                                                                                
Representative  Carpenter pointed  to where  the lines  came                                                                    
close together in  the first 3 months and  were separated in                                                                    
the last three months. He  wondered whether that was an area                                                                    
of concern.                                                                                                                     
                                                                                                                                
Ms. Leary responded that it was not an area of concern.                                                                         
                                                                                                                                
Representative  Carpenter  felt   that  the  separation  was                                                                    
volatility, and queried the causation for that issue.                                                                           
                                                                                                                                
Co-Chair Foster hoped the answer  was a simple one having to                                                                    
do  with a  difference in  oil prices,  however it  was more                                                                    
complicated.                                                                                                                    
                                                                                                                                
Ms. Leary  turned to slide  37. She explained the  slide had                                                                    
taken a look  at where they may need to  take funds from the                                                                    
ERA. She  remarked that  in FY 21,  the majority  was $1.086                                                                    
billion  in the  operating  reserve  for operating  purposes                                                                    
UGF.  She  turned to  slide  38,  which  was closer  to  the                                                                    
deficit anticipated in the governor's budget.                                                                                   
                                                                                                                                
Ms. Leary advanced to slide 39, "Take Aways":                                                                                   
                                                                                                                                
   • Cash flow forecasting is always wrong.                                                                                     
   • Even if the State budget is balanced, borrowing for                                                                        
     cash flow deficits will occur.                                                                                             
   • Budget deficit borrowing may occur if forecasted                                                                           
     assumptions are wrong.                                                                                                     
   • How much is borrowed depends on the actual amounts and                                                                     
     timing of revenues and expenses.                                                                                           
   • Higher Revenue Volatility requires greater Rainy Day                                                                       
     fund reserves.                                                                                                             
   • Volatility management techniques are available.                                                                            
                                                                                                                                
3:34:05 PM                                                                                                                    
                                                                                                                                
Representative  Wool  looked at  slide  20  and asked  about                                                                    
lagging the Permanent Fund.                                                                                                     
                                                                                                                                
Acting  Commissioner  Barnhill  answered  that  was  already                                                                    
underway, and was the POMV.                                                                                                     
                                                                                                                                
Representative  Wool   wondered  whether   the  distribution                                                                    
formula alternatives looked back longer to "smooth it out."                                                                     
                                                                                                                                
Acting Commissioner  Barnhill answered they had  a different                                                                    
smoothing  methodology  than  the  state's  current  lagging                                                                    
method.                                                                                                                         
                                                                                                                                
Representative Wool  surmised that  the formula  changed how                                                                    
the fund was earning.                                                                                                           
                                                                                                                                
Acting  Commissioner  Barnhill  stressed  that  the  formula                                                                    
changed the distribution system of the fund.                                                                                    
                                                                                                                                
3:35:42 PM                                                                                                                    
                                                                                                                                
Representative Carpenter  looked at historic  actual inflows                                                                    
and  outflows. He  asked whether  the slide  represented the                                                                    
state expenses and revenues.                                                                                                    
                                                                                                                                
Ms. Leary  answered that  slide 29  did not  represent state                                                                    
expenses and  revenues. Rather,  it was a  check for  DOR on                                                                    
what was borrowed.                                                                                                              
                                                                                                                                
Acting Commissioner  Barnhill remarked  on an answer  he had                                                                    
given to Representative Josephson earlier.                                                                                      
                                                                                                                                
Representative   Carpenter  asked   how  long   revenue  not                                                                    
transferred into the Permanent Fund.                                                                                            
                                                                                                                                
Acting Commissioner Barnhill answered two years.                                                                                
                                                                                                                                
Representative Carpenter continued with his question.                                                                           
                                                                                                                                
Acting Commissioner Barnhill answered that the constitution                                                                     
required 25 percent of royalties to be transferred to the                                                                       
Permanent Fund .                                                                                                                
                                                                                                                                
HB 205 was HEARD and HELD in committee for further                                                                              
consideration.                                                                                                                  
                                                                                                                                
HB 206 was HEARD and HELD in committee for further                                                                              
consideration.                                                                                                                  
                                                                                                                                
Co-Chair Foster reviewed the schedule for the following                                                                         
day.                                                                                                                            
                                                                                                                                
ADJOURNMENT                                                                                                                   
3:40:59 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:40 p.m.                                                                                          

Document Name Date/Time Subjects
Savings Accounts and Cash Flow presentation House Finance January 30, 2020.pdf HFIN 1/30/2020 1:30:00 PM
DOR-HFIN
HFIN DOR 2020 01 30.pdf HFIN 1/30/2020 1:30:00 PM
DOR Budget Overview HFIN