Legislature(2007 - 2008)
04/18/2007 03:31 PM House FIN
| Audio | Topic |
|---|---|
| Start | |
| SB61 | |
| HB147 | |
| HB205 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
April 18, 2007
3:31 p.m.
CALL TO ORDER
Co-Chair Meyer called the House Finance Committee meeting to
order at 3:31:40 PM.
MEMBERS PRESENT
Representative Mike Chenault, Co-Chair
Representative Kevin Meyer, Co-Chair
Representative Bill Stoltze, Vice-Chair
Representative Harry Crawford
Representative Les Gara
Representative Mike Hawker
Representative Reggie Joule
Representative Mike Kelly
Representative Mary Nelson
Representative Bill Thomas, Jr.
MEMBERS ABSENT
Representative Richard Foster
ALSO PRESENT
Sharon Kelly, Staff, Co-Chair Chenault; Michael Barnhill,
Assistant Attorney General, Department of Law; John
MacKinnon, Deputy Director, Department of Transportation and
Public Facilities; Janet Clarke, Assistant Commissioner,
Division of Finance and Management Services, Department of
Health and Social Services; Brett Carlson, Vice Chair,
Alaska Travel Industry Association (ATIA); Eleanor Wolfe,
Staff, Representative Kurt Olson; Gail Horestki, Assistant
Attorney General, Department of Law
PRESENT VIA TELECONFERENCE
Dave Feeken, Alaska Association of Realtors, Kenai
SUMMARY
CSSB 61(FIN)am "An Act transferring funds to the public
education fund; making supplemental and other
appropriations; amending appropriations; and
providing for an effective date."
CSSB 61 (FIN)am was REPORTED out of Committee with
a "no recommendation".
HB 147 "An Act relating to matching funds in state
tourism marketing contracts with trade
associations."
HB 147 was heard and HELD in Committee for further
consideration.
HB 205 "An Act relating to real estate broker and real
estate salesperson licensing; and providing for an
effective date."
CSHB 205 (FIN) was REPORTED out of Committee with
a "no recommendation" and with zero fiscal note #1
by the Department of Commerce, Community and
Economic Development.
HB 215 "An Act relating to the establishment of a task
force to review the Council on Domestic Violence
and Sexual Assault."
CSHB 215 (HES) was scheduled but not heard.
HB 45 "An Act authorizing the Department of Military and
Veterans' Affairs to establish and maintain Alaska
veterans' cemeteries; and establishing the Alaska
veterans' cemetery fund in the general fund."
CSHB 45 (MLV) was scheduled but not heard.
HB 88 "An Act relating to televisions, monitors,
portable computers, and similar devices in motor
vehicles; and providing for an effective date."
CSHB 88 (JUD) was scheduled but not heard.
3:31:59 PM
CS FOR SENATE BILL NO. 61(FIN) am
"An Act transferring funds to the public education
fund; making supplemental and other appropriations;
amending appropriations; and providing for an effective
date."
SHARON KELLY, STAFF, CO-CHAIR CHENAULT, explained the fast
track supplemental. This bill consists of the remaining
supplemental items that were originally requested by the
Governor in HB 107 and in Section 1 of HB 139, the regular
supplemental. Those items have all been heard by this
committee previously. Ocean Ranger (HB 139 Section 1e
$811.3) funding is not included in this bill.
This CS contains $1,011,133.9 in General Funds, $21,482.5 in
Federal Funds and $4,765.4 in Other Funds for a grand total
of $1,037,382.8.
Ms. Kelly reviewed the new and amended items in the bill:
Sec. 1 (New Item) added in Senate Finance. The sum of
$1,000,000,000 is appropriated from the general fund to
the public education fund for distribution according to
the Foundation formula. (Funding comes from FY07
carry-forward monies to fund FY 09 education costs).
Sec. 2(a) (Previously heard-HB 107 Section 1)
Tax pass thru to regional seafood development
corporations - last year the appropriation was simply
left out - $153.0 in tax assessments/Other Funds.
(Previously heard-HB 139 (Section 1b)
The Alaska Regulatory Commission requested $750.0 in
Regulatory Receipts in the fast track to continue
litigation at FERC to defend RCA's jurisdiction over
intrastate TAPS rates. They also requested an
increment of $600.0 in Regulatory Receipts in the FY08
budget. The amounts have been combined in this bill
for a total of $1,350.0 and placed in this supplemental
with an extended lapse date language to allow them to
spend the funds as the litigation continues during FY's
07, 08 and 09. This helps spread the cost over the
years and avoids the RCA from having to bump their
collections to pay for this amount all in one fiscal
year.
Sec. 3(a) Previously heard-HB 139 Section 1c)
Corrections Inmate Health Care $3,903.4 GF - The
Administration has indicated they may need as much as a
million more before yearend and that additional amount
will be considered in another bill.
(b)Previously heard-HB139 Section 1d)
Anchorage Corrections Complex - largely to pay overtime
for housing additional offenders - $1,082.7 GF.
Sec. 4 (New Item)--$740.3 to pay for the Chenega School
Roof Replacement. Added in Senate Finance.
Sec. 5 (a) (New Item)
The sum of $2,315,000 is appropriated to the Department
of Health and Social Services, Office of the
Commissioner, for operating costs for a comprehensive
program associated with designing, planning, and
implementing the legislative Medicaid Program Review
Report dated February 2007.
This funding is for FY's 07, 08, and 09 and is the
beginning of effort to obtain the millions of dollars
of savings identified in the report.
Federal receipts $1,182,500
General fund $1,132,500
(b) (Previously heard-HB 139, Section g)
Amend language to repair Pioneer Home Roofs. No new
money.
(c) (Previously heard HB 139, Section 1f) $3.5 million
(GF) and $3.0 million (COP) for the Fairbanks Virology
Laboratory Completion. Original appropriation was $24
million in FY 06.
Sec. 6 (a and b) (Previously heard-HB107, Section 2)
This funding pays the Department of Law for the work it
did investigating the Mercer actuarial matter - it does
not pay for any litigation costs but makes the
department whole.
Sec. 7 (Previously heard-HB 139 Sections a-f)
DOTPF sections.
(g) (New Item) Chitina re-appropriation is new and
added here under. There is no dollar change. This
allows the bridge over O'Brien Creek to be rebuilt
providing access to the Chitina dip netters before the
salmon runs this year.
Sec. 8 (Previously heard-HB 107 Section 3)
Funding for special election in April on employment
benefits for same-sex partners. The request was
amended down by $381.3, current request is $775.0.
Sec. 9 (New Item) This amendment was added on the
Senate Floor. It is a re-appropriation not to exceed
$600,000 to Legislative Council for special session
expenses for the fiscal year ending June 30, 2007.
3:38:24 PM
Representative Joule inquired about Section 6, regarding an
$11-$12 million lawsuit action. Co-Chair Chenault reported
that the lawsuit has not been denied and there has been
discussion with the Department of Law on the matter.
MICHAEL BARNHILL, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF
LAW, reported that the department would like to pursue the
case and obtain funding for it. He related that the money
appropriated is just for the investigation that was
completed in January 2007.
Representative Joule asked if the lawsuit is going forward.
Mr. Barnhill reported that nothing has changed in terms of
the level of confidence and in terms of the recommendation
to the legislature to fund the litigation.
3:41:22 PM
Representative Crawford asked what happens next regarding
the lawsuit and funding. Mr. Barnhill reported that the
Department of Law has reduced the request from $12 million
to $6.75 million and the hope is that the request will be
reconsidered by the legislature.
Representative Gara reported that the Department of Law
previously answered his questions about the case being
strong and convinced him that the law firm previously
selected would be best. He asked if that has changed. Mr.
Barnhill related that the choice of Paul, Weiss, Rifkind,
Wharton, & Garrison, LLP, of New York remains the same.
There has been discussion of adjusting the contingency fee
arrangement.
Representative Gara stated support for the Department of
Law's recommendation as to how to proceed on the actuarial
malpractice case.
3:44:52 PM
JOHN MACKINNON, DEPUTY DIRECTOR, DEPARTMENT OF
TRANSPORTATION AND PUBLIC FACILITIES, responded to a
question from Representative Gara regarding the repair of
existing facilities at Chitina. Mr. MacKinnon emphasized
that the purpose is not to force an eminent domain issue.
Improvements will be made to a bridge and boat launch at
O'Brian Creek.
Co-Chair Chenault asked if the language was straightened out
on that subject. Mr. MacKinnon said yes.
3:47:55 PM
Representative Gara referred to funding for the Legislative
Medicaid Program Review Report in Section 5. He wanted
assurance that the appropriation was necessary. He wondered
how a contractor would be selected and who it would be.
JANET CLARKE, ASSISTANT COMMISSIONER, DIVISION OF FINANCE
AND MANAGEMENT SERVICES, DEPARTMENT OF HEALTH AND SOCIAL
SERVICES, pointed out that the work plan is attached to the
request for the supplemental. She explained that if the
funds come to the department rather than to the legislature,
there will have to be a competitive bid process. She
explained about the 50 percent federal reimbursement.
Representative Gara asked if the contractor will be Pacific
Health Group again. Ms. Clarke reported that it would go
out to competitive bid. Representative Gara said he would
accept the department's judgment.
3:51:44 PM
Vice Chair Stoltze MOVED to REPORT CSSB 61 (FIN)am out of
committee with individual recommendations. There being NO
OBJECTION, it was so ordered.
CSSB 61 (FIN)am was REPORTED out of Committee with a "no
recommendation".
3:52:40 PM
HOUSE BILL NO. 147
"An Act relating to matching funds in state tourism
marketing contracts with trade associations."
3:53:04 PM
At-ease.
3:53:47 PM
Representative Gara asked about the private industry match
versus the state match. He wondered where the $2.5 million
that came from the non-cruise ship portion of private
industry goes. He questioned how much money goes into the
match fund for the advertising campaign.
BRETT CARLSON, VICE CHAIR, ALASKA TRAVEL INDUSTRY
ASSOCIATION (ATIA), addressed Representative Gara's
questions. The $2 million private sector portion goes into
the fund and is traded for "value", such as an ad or a
chance to participate in a media road show. Representative
Gara summarized that ATIA charges a business for access to
advertising, as a value match. He asked where the $.5
million came from. Mr. Carlson replied, "$2 million in non-
cruise pay to play, and then $.5 million comes from what
industry calls DMO's, Destination Marketing Organizations,
which would be one of three things, generally." Larger
cities would have a convention and visitors' bureau, some
smaller cities would have chambers, and a few cities might
have a department of the city.
3:58:57 PM
Vice Chair Stoltze drew attention to a letter by Chip Thoma
(copy on file.)
Co-Chair Meyer asked about the 90/10 split. He said he is
not so sure that the cruise ship contribution is going to go
away. He voiced concern about ATIA's belief that without
that contribution only $2 million could be raised. He
thought that ATIA was hoping that the state would contribute
$20 million because ATIA proposes to raise $2 million. He
thought a $20 million request was high. He wondered what
would happen if the current state contribution of $8 million
is kept. Mr. Carlson emphasized that this legislation has
no bearing on the actual amount of legislative
appropriation. ATIA does not believe that state government
should appropriate money back that ATIA is not putting in.
He explained how the fund would grow. The bill would allow
ATIA to match appropriated funds. If the bill does not
pass, ATIA has no access to the funds.
Co-Chair Meyer agreed that $5 million of the car rental tax
is tourism related and could go to ATIA. He pointed out
that it is uncertain how much money will be obtained from
the cruise ship initiative. He thought it was premature to
ask for additional money at this time. He suggested other
splits.
4:04:28 PM
Co-Chair Meyer asked if ATIA would support a statewide bed
tax or sales tax. Mr. Carlson explained that the hope is
that other forms of revenue would be available in the
future. He stressed that the discussion on the funding
level could take place another time. At stake now is the
match. Co-Chair Meyer asked if the cruise ship industry
contributed money this year. Mr. Carlson reported that that
funding will be lost beginning July 1.
4:07:19 PM
Representative Kelly pointed out that action needs to be
taken at this time. The bill in its current form would
require a match of $800,000. He spoke in support of the
bill with an amendment.
Representative Thomas asked if the cruise ship industry has
bailed. Mr. Carlson said that their funding cannot be
counted on in FY 08. Representative Thomas asked about car
rental tax money going only to tourism marketing. He
preferred to allocate it for independent travel. He
reported that he voted against the cruise ship head tax. He
said he does not know what the cruise ship head tax money
can be used for.
4:11:24 PM
Representative Gara summarized that this bill is a policy
call based on a guess about the cruise industry. The
independent tourism industry benefits if the cruise industry
does not contribute. He questioned why $2 million for pay
to play and $.5 million of DMO contributions last year
translates to only a total of $2 million this year. He
questioned why private industry's donation shouldn't be
larger this year than last.
Mr. Carlson responded that the 10/90 legislation looks to
the future to raise money for a state marketing program. He
opined that a match from the private sector makes sense. He
explained that currently $500,000 comes from DMO's, which
should be used locally. Long-term, a voluntary tax won't
work.
Representative Gara was not convinced it was $2.5 million
last year. He brought up that in Alaska tourism businesses
don't pay a state sales, income, or corporate tax. He
suggested a 3 to 1 ratio. Co-Chair Meyer agreed.
4:17:04 PM
Mr. Carlson related that 38 states have no private sector
match. Of the 11 state that do, Alaska's small industry
contributes $5 million, which is just below California.
HB 147 was heard and HELD in Committee for further
consideration.
4:18:26 PM
HOUSE BILL NO. 205
"An Act relating to real estate broker and real estate
salesperson licensing; and providing for an effective
date."
Representative Gara MOVED to ADOPT Amendment #1:
Page 3, lines 19 - 20:
Delete "[FORGERY, THEFT, EXTORTION, CONSPIRACY TO
DEFRAUD CREDITORS, OR"
Insert "or who is convicted of forgery, theft,
extortion, conspiracy to defraud creditors, or fraud ["
Page 4, lines 13 - 15:
Delete "[, FORGERY, THEFT, EXTORTION, CONSPIRACY TO
DEFRAUD CREDITORS, OR"
Insert "or upon conviction of forgery, theft,
extortion, conspiracy to defraud creditors, or fraud
[,"
Page 5, lines 9 - 11:
Delete "[, FORGERY, THEFT, EXTORTION, CONSPIRACY TO
DEFRAUD CREDITORS, OR"
Insert "or upon conviction of forgery, theft,
extortion, conspiracy to defraud creditors, or fraud
[,"
Page 6, lines 2 - 3:
Delete "[FORGERY, THEFT, EXTORTION, CONSPIRACY TO
DEFRAUD CREDITORS, OR"
Insert "or under indictment for forgery, theft,
extortion, conspiracy to defraud creditors, or fraud ["
Co-Chair Meyer OBJECTED.
Representative Gara explained that the amendment addresses
what the realtors were trying to address previously. He
related that under current law realtors would lose their
license if they have engaged in the crime of dishonesty -
forgery, theft, extortion, or conspiracy to defraud
creditors. The language relating to "moral turpitude" was
removed and "fraud" was added. The real estate commission
also wanted the discretion to take away a license for other
felonies.
ELEANOR WOLFE, STAFF, REPRESENTATIVE KURT OLSON, pointed out
that the language was added at the request of the Department
of Law.
4:22:45 PM
Vice Chair Stoltze asked what constitutes crimes of moral
turpitude.
GAIL HORESTKI, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF
LAW, explained that "moral turpitude" is somewhat obsolete.
Those crimes are viewed as crimes that are wrong in and of
themselves, as opposed to regulatory crimes such as a
driver's license violation.
4:25:12 PM
Ms. Horestki related a list of statutes that contain the
same language as in this bill regarding whether the felony
or other crime committed affects the ability of that person
to practice as a broker or associate broker competently and
safely. The trend is to move away from moral turpitude.
Representative Thomas asked if Ms. Horestki approves of the
amendment. Ms. Horestki said she has no problem with it.
Representative Thomas observed that he liked the clarity in
the amendment.
Ms. Horestki summarized the intent of the amendment - to
preserve the present disqualifying offenses which appear to
be directly related to real estate transactions, and to also
give the commission the ability to use its discretion to
determine whether a particular conviction affects the
person's ability to practice their profession. She related
an example of a drug felon who was denied a license.
Co-Chair Chenault asked if the language is acceptable to the
Alaska Association of Realtors.
DAVE FEEKEN, ALASKA ASSOCIATION OF REALTORS, KENAI,
explained that the language of the bill strengthens the
commission's ability to control who is licensed.
4:30:42 PM
Representative Gara asked for Mr. Feeken's opinion of
Amendment 1. Mr. Feeken had not seen it. Representative
Gara reiterated what the amendment would do.
Mr. Feeken related that his agency is in favor of anything
that strengthens the ability of the commission to protect
the public.
Co-Chair Meyer WITHDREW his OBJECTION.
There being NO OBJECTION, Amendment #1 was adopted.
4:34:12 PM
Vice Chair Stoltze MOVED to REPORT CSHB 205 (FIN) out of
committee with individual recommendations and the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
CSHB 205 (FIN) was REPORTED out of Committee with a "no
recommendation" and with zero fiscal note #1 by the
Department of Commerce, Community and Economic Development.
ADJOURNMENT
The meeting was adjourned at 4:36 PM.
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