Legislature(1997 - 1998)
03/05/1997 01:40 PM House FIN
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
MARCH 5, 1997
1:40 P.M.
TAPE HFC 97 - 46, Side 1, #000 - end.
TAPE HFC 97 - 46, Side 2, #000 - end.
TAPE HFC 97 - 47, Side 1, #000 - end.
TAPE HFC 97 - 47, Side 2, #000 - #682.
CALL TO ORDER
Co-Chair Gene Therriault called the House Finance Committee
meeting to order at 1:40 P.M.
PRESENT
Co-Chair Hanley Representative Kelly
Co-Chair Therriault Representative Kohring
Representative Davies Representative Martin
Representative Davis Representative Mulder
Representative Foster
Representative Grussendorf and Representative Moses were not
present for the meeting.
ALSO PRESENT
Representative Alan Austerman; Amy Daugherty, Staff,
Representative Austerman; Timothy Sullivan Jr., Staff,
Representative Eldon Mulder; Nico Bus, Chief, Financial
Services, Department of Natural Resources; Barbara Ritchie,
Deputy Attorney General, Civil Division, Department of Law;
Jerry Dugan, (Testified via teleconference), Executive
Director, Alaska Marine Safety Education Association
(AMSEA), Petersburg; Ian Fulp, (Testified via
teleconference), Director, Parks and Recreation, City of
Kodiak, Kodiak; Pat Holmes, (Testified via teleconference),
Fisherman, Kodiak; Al Burch, (Testified via teleconference),
Kodiak; Bill Barker, (Testified via teleconference),
Fisherman, Kodiak; Barbara Burch, (Testified via
teleconference), Kodiak Fishermen Wives Association, Kodiak;
Sue Hargis, United States Coast Guard, Juneau; Betty Martin,
State Comptroller, State Treasury, Department of Revenue;
Mark Johnson, Emergency Medical Services (EMS), Department
of Health and Social Services; Kevin Smith, Alaska Municipal
League (AML), Joint Insurance Association, Juneau; Fred
Fisher, Director, Division of Administrative Services,
Department of Law.
SUMMARY
1
HB 13 An Act relating to marine safety training and
education programs.
CS HB 13 (FIN) was reported out of Committee with
a "no recommendation" and with two zero fiscal
notes by the Department of Labor dated 2/21/97 and
the House Finance Committee.
HB 30 An Act relating to civil liability for
skateboarding; and providing for an effective
date.
CS HB 30 (FIN) was reported out of Committee with
a "do pass" recommendation and with zero fiscal
notes by the Legislature dated 1/31/97 and the
Alaska Court System dated 1/31/97.
HB 113 An Act extending lapse dates for certain prior
year appropriations; making supplemental, capital,
and special appropriations; and providing for an
effective date.
HB 113 was HELD in Committee for further
consideration.
HOUSE BILL 13
"An Act relating to marine safety training and
education programs."
REPRESENTATIVE ALAN AUSTERMAN stated that the Alaska Marine
Safety Education Association (AMSEA) has been operating in
the State of Alaska for 12 years. The primary purpose of
the organization is to reduce the loss of life and injury in
the Alaskan marine environment by providing education
through a statewide network of qualified marine safety
instructors.
AMSEA provides the safety training required by the
Commercial Fishing Vessel Safety Act of 1988 to communities
throughout Alaska. The Act, which took effect in 1991,
requires a minimum in safety training and equipment for
commercial fishing vessels.
Representative Austerman continued that AMSEA also helps
Alaskans by providing marine safety instructor training, and
that some of these teachers teach drill instructor courses.
Other marine safety instructors also train the Alaska
boating and fishing public, including many children and
adults, in marine safety. Of the 7,300 people AMSEA trained
in 1995, 2000 were from the commercial fishing industry and
3,700 were children.
2
According to a study conducted in 1995 by the Native Health
Service, the AMSEA training significantly reduced fatalities
among commercial fishermen, thus, coinciding with a 50%
percent drop in fishing fatalities in Alaska over the past
four years. Representative Austerman suggested that AMSEA
deserves the State's intervention to ensure a long-term
stable funding source.
He pointed out that the Fishermen's Fund (AS 23.35.060) was
created before statehood. One hundred percent of the
fishermen's fund is provided by commercial fishing license
fees. Sixty percent of license fees are dedicated to that
fund. Since commercial fishermen are often the
beneficiaries of the required marine safety training, it
would be appropriate to allow part of the interest of that
fund to be used to support some of AMSEA's marine safety
programs.
Representative Austerman pointed out that the note which
passed out of the House Finance Committee last year was in
the amount of $150 thousand dollars. The group would be
comfortable with that amount, although, he pointed out that
current interest earnings for the fund are in the amount of
$450 thousand dollars.
Representative Mulder asked if the program had considered a
fee-based structure for funding. Representative Austerman
requested that Mr. Dugan, the Executive Director of the
program respond.
Representative Martin asked the amount currently available
in the fund. Representative Austerman replied that
approximately $7.367 million dollars remains in the
Fishermen's Fund. The Department of Treasury would be
responsible for any investment. Co-Chair Therriault
corrected that the current balance in the account was $9
million dollars. Representative G. Davis questioned why the
fiscal note indicated only a 5.3% interest rate.
JERRY DUGAN, (TESTIFIED VIA TELECONFERENCE), EXECUTIVE
DIRECTOR, ALASKA MARINE SAFETY EDUCATION ASSOCIATION
(AMSEA), PETERSBURG, responded to Representative Mulder
explaining that AMSEA currently uses a fee-based structure
for most of the provided training. A sliding scale fee is
used, which varies depending upon the need. Most of the
fees are used to pay the instructor and not to supplement
the program.
At the end of last year, the program was faced with a $50
thousand dollar budget, reducing the staff to one person to
run the entire State program. In October, 1996, the program
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received a federal grant increasing that budget, although,
those funds end September 30, 1997. There is no guarantee
of funding after that point.
Representative J. Davies inquired about the needed amount.
Mr. Dugan responded that the program would need $150
thousand dollars to stay "afloat". That amount would
provide the core program and staff a 2.5 person office to
coordinate, administer and instruct programs throughout the
State.
In response to Representative Davies, Mr. Dugan noted that
his office had provided a budget detail sheet to
Representative Austerman's office last year. A handout of
the budget detail sheet was provided to Committee members.
[Attachment on file].
Representative Mulder inquired the "range" of charges
required of the communities. Mr. Dugan explained that the
least amount would be free and only for a very needy group.
The highest amount charged was $65/hour.
Representative Mulder questioned the criteria used to
determine if a group had "great need". Mr. Dugan stated
that "great need" could be used to reference a commercial
fishermen group under a federal deadline mandating the
training before the fishing season had begun and before
income had begun to come in. He suggested that a good
example would be the Village of Angoon on Admiralty Island,
an area with a high level of unemployment.
Representative Mulder asked who was required to complete the
AMSEA training. Mr. Dugan explained that fishermen on
documented fishing vessels which fish in outside waters or
beyond the western coast would be required. Representative
Mulder questioned how the "children" aspect worked into the
training. Mr. Dugan explained that marine safety is also
taught to high school children who fish or crew on boats.
For younger children, there is an abbreviated program to
familiarize them with boating devices and safety procedures.
Mr. Dugan continued, if someone were certified in the
training, they would then be able to train others. That
instruction would be beyond the regular level of instruction
and is the core of the program.
Representative Mulder observed that once a funding mechanism
is in place, it becomes close to impossible to remove it
from the books. Mr. Dugan pointed out with more instructors
trained, the group then will be responsible to administer
the programs.
PAT HOLMES, (TESTIFIED VIA TELECONFERENCE), FISHERMAN,
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KODIAK, testified in support of the legislation. He pointed
out that Alaska has ten times the national rate of drowning.
Alaska is the only State which has no marine safety statutes
or programs. AMSEA provides in Alaska, what many other
states government's are mandated to provide. He emphasized
how important the program is to the State. He pointed out
that previous funding had been provided through grants, a
program which now is "drying" up. He urged the Committee's
support of the legislation.
AL BURCH, (TESTIFIED VIA TELECONFERENCE), KODIAK, voiced
support of the legislation. He provided a brief history of
fishing in Alaska. He spoke to the resistance that most
fishermen have had toward a federal initiative to mandate
training and how that attitude has changed through the many
lives which have been saved because of the program. He
urged that a portion of the interest on the Fishermen's Fund
be used to further save lives.
BILL BARKER, (TESTIFIED VIA TELECONFERENCE), FISHERMAN,
KODIAK, spoke in favor HB 13. He stressed that AMSEA's work
saves lives and how important the training would be for the
fishing communities. The program is an educational concern
and would be appropriately funded through the Fishermen's
Fund. Mr. Barker reiterated that the training saves lives.
BARBARA BURCH, (TESTIFIED VIA TELECONFERENCE), KODIAK
FISHERMEN WIVES ASSOCIATION, KODIAK, testified in support of
the legislation stressing the importance of the program.
SUE HARGIS, UNITED STATES COAST GUARD (USCG), JUNEAU, noted
support of the legislation. She noted the importance of the
program as there are no other State programs which
coordinate any type of boating efforts. She urged members
to support the legislation.
MARK JOHNSON, EMERGENCY MEDICAL SERVICES (EMS), DEPARTMENT
OF HEALTH AND SOCIAL SERVICES, voiced strong support of HB
13. Drowning in Alaska is a major public health problem;
often there are more drownings in the State than there are
deaths on public highways. He advised that the Office of
Emergency Medical Services provided the first drowning study
in 1979, and recognized drowning as a major public health
problem since then. EMS is one of the agencies which helped
form AMSEA and has continued to help fund them through a
variety of federal grants since that time. All those grants
have been temporary. Mr. Johnson stressed that the
organization deserves stable funding.
Co-Chair Hanley asked if the Governor had included funding
for that item in this year's budget.
5
AMY DAUGHERTY, STAFF, REPRESENTATIVE ALAN AUSTERMAN, stated
that no funding had been included in the FY98 budget for
AMSEA.
Co-Chair Therriault asked if it had been acknowledged that
only AMSEA be the recipient of the grant for education.
Representative Austerman responded that the AMSEA
organization, to date, has provided the training as a result
of federal laws. He agreed that as the program matures, it
could be placed into the private sector. Representative
Martin exclaimed that a 5.2% interest rate was a low rate.
BETTY MARTIN, STATE COMPTROLLER, STATE TREASURY, DEPARTMENT
OF REVENUE, replied that the current general investment
funds include over one hundred smaller funds, some of which,
through statutory or Attorney General opinions have the
right to receive their own interest. The Fishermen's Fund
is not one of those funds. The Department of Administration
determines which of those funds are eligible for interest.
The current agreement is to pay each organization at the
rate of 5.2% interest income. The State at this time is
reconsidering the practice with the intent to pay the entire
interest received to each of the individual funds.
(Tape Change HFC 97-46, Side 2).
Representative Martin asked if there was a major disaster,
could the principle of the fund be used quickly. Ms. Martin
explained that there was a limit of $2,500 dollar per person
cap to the amount paid out of the fund. Representative
Martin questioned the cap.
Representative Martin suggested that the amount provided to
AMSEA should be a guaranteed amount rather than a moving
amount as predetermined by the interest rate. Co-Chair
Therriault pointed out that the language was permissive and
that the Legislature could appropriate "none" or "all"
through the budgeting process. Representative Martin
reiterated that a specific number should be guaranteed. Co-
Chair Hanley added that the appropriation would be a
budgetary issue and that any amount could be appropriated.
He pointed out that if the bill passes, it would be
accompanied by a fiscal note, however, next year, the
request would only be a line item in the budget, open to
debate.
Representative J. Davies asked where the money for the
fiscal note would be indicated in the budget. Co-Chair
Therriault distributed the House Finance Committee a new
zero fiscal note, suggesting that through the budget
process, the amount would be determined. In the past, the
6
Department of Administration placed the request in
designated grants component in Department of Community and
Regional Affairs budget. Representative J. Davies asked if
the money was appropriated, would it appear as designated
program receipts. Co-Chair Therriault stated that the
Department would be responsible to show a reduction in order
to authorize requested funding for the program.
Representative G. Davis MOVED to delete language on Page 1,
Lines 9 & 10, "to the Alaska Marine Safety Education
Association". There being NO OBJECTION, it was adopted.
Representative Martin MOVED to change Page 1, Line 8,
deleting "50 percent" and inserting "up to $250 thousand
dollars". Co-Chair Hanley believed that could create a
problem when $250 thousand dollars was not earned in
interest income. He reiterated that the issue could be
addressed in the budget process.
Co-Chair Therriault OBJECTED to Amendment #2.
Representative J. Davies voiced support to keep the number
"floating", reminding members that there will always be
pressure to keep it as small as possible.
A roll call vote was taken on the MOTION.
IN FAVOR: G. Davis, Martin, Mulder
OPPOSED: Foster, Kohring, J. Davies, Therriault,
Hanley
Representatives Grussendorf, Kelly, and Moses were not
present for the vote.
The MOTION FAILED (3-5).
Representative G. Davis noted for the record that he
supported the work of AMSEA and that the reason for his
amendment was not intended as a personal threat to that
group.
Representative Foster MOVED to report CS HB 13 (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal notes. Co-Chair Hanley disclosed that
he had a conflict of interest as he does acquire a
commercial fishing license and has utilized the AMSEA fund.
Representative J. Davies requested more discussion regarding
the fiscal note. He understood that a fiscal note needed to
be funded for the first year and would then be dropped into
the budget line items the second year.
Co-Chair Hanley commented that had been the approach last
year. Conference Committee often reduces fiscal notes to
7
squeeze them within a certain dollar amount. He suggested
that the fiscal impact of the legislation be discussed in
the Department of Community and Regional Affair's
Subcommittee priority. He added that the Governor should
offer an amendment to cover the requested dollar amount.
Co-Chair Therriault said if a statutory change is made to
start a new program, the first year, it would be funded
through a fiscal note, thereafter, it would be built into
the base of the budget. Because HB 13 is permissive, it
could be either way.
Representative J. Davies foresaw a problem with the
subcommittee trying to place money into a budget for a
program not yet signed into effect. Co-Chair Therriault
advised that to appropriate to the program, would not
require that the program be in effect. Representative J.
Davies voiced concern that there clearly was a fiscal impact
which should be noted in the fiscal note. Co-Chair Hanley
responded that all fiscal notes accompany the bill to
Conference Committee.
CS HB 13 (FIN) was reported out of Committee with a "no
recommendation" and with zero fiscal notes by the Department
of Labor dated 2/21/97 and the House Finance Committee.
HOUSE BILL 30
"An Act relating to civil liability for skateboarding;
and providing for an effective date."
TIMOTHY SULLIVAN JR., STAFF, REPRESENTATIVE ELDON MULDER
explained that the Municipality of Anchorage, City and
Borough of Juneau and several other municipalities would
like to create skateboard parks so skateboarders will have a
place to ride, rather than using other areas designed for
pedestrians. The municipalities are willing to develop
areas suitable for skateboard riding if they can be
insulated from liability for claims arising from hazards
inherent in skateboarding.
The intent of HB 30 would be to encourage the municipalities
to proceed with development of areas for outdoor recreation
without increasing their liability unnecessarily. The bill
would apply only to municipal skateboard parks.
Mr. Sullivan added that the legislation is patterned after
legislation passed providing limited protection to ski
areas. The protection from liability relates to inherent
dangers and risks of skateboarding. The municipality is
required to post signs warning that there are inherent risks
to skateboarding and the liability would then rest with the
8
skateboarder.
Representative J. Davies questioned benefits to the
municipalities. Mr. Sullivan stated that it would be cost
prohibitive to create these areas without the legislation.
Letters have been included in the packet from various
municipalities indicating support for the legislation.
Representative Mulder spoke to the work draft on Page 5,
Lines 6 & 7, indicating language added in the House
Judiciary Committee clarifying that the legislation would
not provide a "blanket" shield to the municipality or
borough who constructs it, although, it would provide for a
limited amount of protection.
IAN FULP, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, PARKS
AND RECREATION, CITY OF KODIAK, KODIAK, spoke in support of
the legislation. He stated that the bill would provide a
place to skateboard and would then provide better management
of the sport. He asked if a supervisor were present, would
the municipality be more liable if there were an accident.
Representative Mulder suggested that it would depend on the
function of that supervisor.
Committee members discussed "inherent risk" and the
responsibilities of the municipalities and boroughs
regarding that concern.
Co-Chair Hanley MOVED that work draft #0-LS0192\K, Ford,
3/5/97, CS HB 30 (FIN), be the version before the Committee.
There being NO OBJECTION, it was adopted.
Representative J. Davies noted for the record that he
supports the legislation, although, recognized that there
exists some grey areas.
KEVIN SMITH, ALASKA MUNICIPAL LEAGUE (AML), JOINT INSURANCE
ASSOCIATION, JUNEAU, testified that AML supports the
legislation. The AML Joint Insurance Association is a pool
formed by Alaska Statute, and created for local government
entities, specifically the municipalities and school
districts. He noted that it has been the experience of his
group that municipalities, in general, are reluctant to
become involved with that type of activity. Skateboarding
in particular has been a common exclusion throughout most
insurance league industry. The Joint Insurance
Association's Trustee Board is willing to drop the exclusion
with passage of HB 30.
(Tape Change HFC 97-47, Side 1).
Representative Kohring MOVED to report CS HB 30 (FIN) out of
9
Committee with individual recommendations and with the
accompanying fiscal notes. There being NO OBJECTION, it was
so ordered.
CS HB 30 (FIN) was reported out of Committee with a "do
pass" recommendation and with two zero fiscal notes by the
Legislature dated 1/31/97 and the Alaska Court System dated
1/31/97.
HOUSE BILL 113
"An Act extending lapse dates for certain prior year
appropriations; making supplemental, capital, and
special appropriations; and providing for an effective
date."
DEPARTMENT OF NATURAL RESOURCES
Section 4(e)
$200.0 thousand dollars - Perseverance Trail
NICO BUS, CHIEF, FINANCIAL SERVICES, DEPARTMENT OF NATURAL
RESOURCES, stated that the requested funding would provide
emergency repairs to the severely storm damaged Perseverance
Trail. Though the trail is closed, use continues under
extreme hazardous conditions. The work needs to be done
before the summer season, to capture the high use period.
Delaying the work until the Fall would expose workers to
dangerous avalanche and weather conditions and would
increase project costs by limiting the time and access.
Co-Chair Therriault inquired if any of the trail rested on
private property. Mr. Bus noted that the entire trail
system was an "easement into perpetuity", belonging to the
State of Alaska.
Mr. Bus advised that no permits would be needed for
blasting. Co-Chair Hanley voiced concern with the impact of
the blasting on the streams. He requested that a letter of
response be provided by the Department of Fish and Game,
which would address the impacts of blasting on the streams,
in order that consistency could be created in use for other
requests. Mr. Bus replied that no permit is needed because
a concrete flume exists at the bottom of the area and that
no salmon can run up.
Mr. Bus spoke to the breakdown of the request; $120 thousand
dollars would be used for the blasting work and $80 thousand
dollars would be used for the bridge repair and tread work
from the beginning of the trail to the last bridge. Mr. Bus
provided Committee members a handout illustrating the
10
Perseverance trail emergency repairs. [Copy on file]. He
provided an overview of that handout.
Representative Kohring questioned the "emergency" need of
the project. He urged that the request be addressed in the
Capital Budget Request (CBR). Mr. Bus reminded
Representative Kohring that over 35,000 people use the
trail. It is necessary to begin the work in May to be able
to address summer tourism. Representative Kohring noted
that the trail is used for recreation purposes only.
Representative J. Davies argued that the timing of the
project places it into the Supplemental Request category and
that the impact of not doing the work now, would close the
trail for the entire summer.
Representative Martin asked if tourism raised enough money
to address the concern and future repairs of the area. Mr.
Bus replied that the user fee for tourism was $250 dollars a
year. He argued that the State of Alaska is the land owner,
whose responsibility it is to keep the area safe.
Representative Martin asked if the City of Juneau would
participate in covering the costs. Mr. Bus noted that the
City's budget was limited as a result of many areas
experiencing significant storm damage this year. Mr. Bus
spoke to the timing of the repair work noting that if it
commenced on May 1st, it would be ready for the summer
tourists in early June.
Representative J. Davies asked if the commercial use fees
were placed into the General Fund. Mr. Bus informed members
that those fees are placed into the Division of Parks
budget, and then used for operation purposes.
Section 9(a)
$3,788.3 thousand dollars - Fire Suppression
Mr. Bus noted that the request would address the fire
suppression budget from January through June, 1997. Last
year, the Department spent $7.8 million dollars and carried
forward $2.1 million dollars, leaving a balance of $1.5
million dollars. Costs between now and June, 1997, are
estimated to be $5.3 million dollars.
Co-Chair Hanley asked the amount of fixed costs in the
request. Mr. Bus replied that the fixed costs from January
through July, would be $2.3 million dollars. Co-Chair
Hanley understood that the fixed costs would be addressed in
the Operating Budget and that the "non-fixed costs" would be
addressed in the Supplemental Budget Request. Mr. Bus
11
replied that the fixed costs to the Department were $4.6
million dollars, and were divided into two time segments.
Mr. Bus added that the increase to the fixed cost budget
resulted from long term contracts coming up for renewal at
higher amounts than originally contracted for.
Section 9(c)
$100.0 thousand dollars - Old Eagle School Site
Mr. Bus informed Committee members that this supplemental
request would fund the removal of existing buildings and
facilities at the Old Eagle School site and would allow for
eventual remediation of contaminated soils at the site so to
reduce health and safety hazards. The request had resulted
from a lawsuit which was filed by the Village of Eagle. The
judge ordered that the money be appropriated by July, 1996.
Co-Chair Hanley asked who built the school. Mr. Bus stated
that it was purchased from the Bureau of Indian Affairs
(BIA). To make the site useable, the buildings will need to
be cleaned up and the soil contamination addressed. The
Village of Eagle sued the U.S. Government and the State of
Alaska.
BARBARA RITCHIE, DEPUTY ATTORNEY GENERAL, CIVIL DIVISION,
DEPARTMENT OF LAW, noted that the settlement was adopted as
an order of the Court. The U.S. government is not
contributing to the removal costs. There is no evidence to
indicate that the contamination existed in 1967 when the
State took title of the property. She stated, the State of
Alaska is responsible for the clean-up costs and all hazards
on the property.
Ms. Ritchie continued, the Village of Eagle brought their
law suit against the State in order to bring the property
back to it's original state. The U.S. government and the
State of Alaska moved to dismiss the case based on sovereign
immunity. There exists a statute stipulating that a suit
can be brought forward, if the complaint is filed by the
same entity who owned the property before the contamination.
The United States dismissed it, noting that they were not
the former owner of the property. The judge denied that
action and requested a briefing in order to check the Alaska
Native Claims Settlement Act (ANCSA) status of government at
that time.
Co-Chair Therriault pointed out that the building was
"laced" with asbestos before the State took ownership from
the federal government. Ms. Ritchie assessed that the
asbestos tiles were in the floor and were not in and of
12
themselves illegal. If they were well maintained, there
would not be a release of fiber. The problem developed when
the State purchased the property, and it was no longer
maintained.
Co-Chair Hanley voiced his frustration that the State is
held liable for an REAA responsibility. Ms. Ritchie
reiterated that this is State property and that it is not
being operated by an REAA at this time.
Mr. Nico advised that the requested funding would only
address Phase I of the project. Following completion of
that, the oil contamination problem would need to be
addressed. This request has been expedited because of the
Court settlement order completion by July 1, 1997.
Ms. Ritchie reiterated that there are no facts indicating
that a problem existed before the State took over ownership
of the property. Committee members noted their surprise
that the federal government would not be responsible for any
of the costs.
(Tape Change HFC 97-47, Side 2).
DEPARTMENT OF LAW
Section 6(a)
0.0 - Oil and gas audits & legal
proceedings
FRED FISHER, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF LAW, pointed out that in most years since
FY79, the Department has received more than one
appropriation per year for oil and gas litigation purposes.
Beginning in FY92, the Legislature changed that policy by
making only one appropriation per year. Consequently, from
the years FY92 through FY95, the Department requested
supplemental appropriations, although, had difficultly
spending those appropriations by the end of the fiscal year.
As a result, management policy was to encumber the funds
received late in the fiscal year and spend those funds
during the following fiscal year. This practice was
questioned last year by the Division of Budget and Audit, at
which time, the Department requested a lapse date extension
which was granted by the Legislature.
Mr. Fisher spoke to the available options. He noted that
concerns had been expressed with tapping the Constitutional
Budget Reserve (CBR) fund 3/4 vote. Ms. Ritchie noted her
surprise by handout provided from the Governor's Office
recommending deletion of the request. [Copy on file].
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Mr. Fisher referenced another option which would request a
General Fund supplemental in leu of the last date extension.
An additional option would be deleting the entire section.
He believed, to discontinue the current practice would place
the Department in a situation requiring future supplemental
appropriations.
Co-Chair Hanley agreed that there have been carry-forwards
for many years. He suggested that the Department provide a
budget which clarifies what they anticipate the need will be
for litigation. Should the Department have unforseen
circumstances, they will then come to the Legislature for a
supplemental. Co-Chair Hanley requested no more carry-
forwards.
Mr. Fisher advised, of the $7 million dollars allocated, the
Department has spent $6.1 million dollars and anticipates
using the remainder before the end of the fiscal year. He
pointed out that the request had been made in order to clear
potential audit questions.
Co-Chair Hanley noted that a split supplemental would not
create problems; carry-forwards create problems. Mr. Fisher
pointed out that prior year costs to the budget generally
are representative of actual expenditures and encumbrances
as of the end of the fiscal year. That action has created
confusion to oil and gas litigation costs.
Co-Chair Hanley requested a spread-sheet of the "actual"
costs as well as anticipated "actual" costs to be spent by
the Department over the year. The chart should indicate the
$7 million dollars that was encumbered in the previous
fiscal year and spent in this fiscal year.
Section 6(b)
$97.1 thousand dollars - Civil
Ms. Ritchie provided Committee with a handout identifying
additional FY97 judgments from the General Fund. [Copy on
file]. The list contains a total itemized request of $235.1
thousand General Fund dollars.
Co-Chair Hanley asked if the Venetie versus State case was a
judgement or settlement. Ms. Ritchie stated that request
was for $11.7 thousand dollar costs awarded to the plaintive
by the federal District Court arising from the trial of that
case. The request does not cover attorney fees or
settlement costs. No payment was involved in the
settlement.
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She commented that this was not the Venetie case that the
State is currently taking to the Supreme Court. The case
referenced in Section 6(b) originated in November, 1986,
when the IRA Councils of Venetie sued the State and the
Commissioner of the Department of Health and Social Services
for an injunctive and declaratory relief addressing
substitute birth certificates. The State declined to issue
the birth certificates on the basis that the Tribal Courts
did not have the authority to undertake the adoption.
Mr. Ritchie continued, the case went to the 9th Circuit
Court and then remanded back to the District Court for a
trial on the Tribal status issue. When the case was
remanded, it was consolidated for the purposes of a trial.
Eventually, the judge issued a decision on tribal status and
Indian country.
Ms. Ritchie noted that the request would cover costs accrued
by the plaintiffs in that case. They also sought attorney
fees which Judge Holland denied. The issue of case
addressed Tribal status and costs were awarded.
Co-Chair Hanley noted that Alaska Legal Services was
representing the Venetie case. Ms. Ritchie interjected that
case was being represented by Alaska Legal Services,
although, the tax case was represented by the Native
American Rights Fund. Alaska Legal Services is a private,
non-profit, established by federal law, and recipient of
funding under the Legal Service's Act appropriated by
Congress. Legal Services is allowed under federal law, to
represent any sort of group or association if that group is
composed of people eligible for that assistance under the
Legal Services Corporation Act. That criteria is based upon
income.
Representative J. Davies asked if the interest column would
increase. Ms. Ritchie replied that the interest column had
been calculated through June 30, 1997.
Ms. Ritchie noted that in 1996, Congress amended the Legal
Services Act to prohibit recipients of Legal Services
funding from collecting attorney's fees. That prohibition
applies to all cases after the enactment date, although,
would not apply to cases with pending issues prior to that
time.
HB 113 was HELD in Committee for further discussion.
ADJOURNMENT
The meeting adjourned at 4:29 P.M.
15
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