Legislature(2019 - 2020)ADAMS ROOM 519
02/28/2019 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB39 || HB40 | |
| Fy 20 Budget Overview: Department of Administration | |
| Fy 20 Budget Overview: Office of the Governor | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 39 | TELECONFERENCED | |
| *+ | HB 40 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HOUSE FINANCE COMMITTEE
February 28, 2019
1:34 p.m.
1:34:44 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 Tammie Wilson, Co-Chair
Representative Jennifer Johnston, Vice-Chair
Representative Dan Ortiz, Vice-Chair
Representative Ben Carpenter
Representative Andy Josephson
Representative Gary Knopp
Representative Bart LeBon
Representative Kelly Merrick (via teleconference)
Representative Colleen Sullivan-Leonard
Representative Cathy Tilton
MEMBERS ABSENT
None
ALSO PRESENT
Lacey Sanders, Budget Director, Office of Management and
Budget, Office of the Governor; Cheryl Lowenstein,
Administrative Services Director, Department of
Administration, Office of Management and Budget, Office of
the Governor; Shawn Henderson, Administrative Services
Director, Office of the Governor.
PRESENT VIA TELECONFERENCE
Representative Kelly Merrick
SUMMARY
HB 39 APPROP: OPERATING BUDGET/LOANS/FUNDS
HB 39 was HEARD and HELD in committee for further
consideration.
HB 40 APPROP: MENTAL HEALTH BUDGET
HB 40 was HEARD and HELD in committee for further
consideration.
FY 20 BUDGET OVERVIEWS: DEPARTMENT OF ADMINISTRATION
OFFICE OF THE GOVERNOR
Co-Chair Foster reviewed the meeting agenda.
HOUSE BILL NO. 39
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs; capitalizing funds; amending
appropriations; making appropriations under art. IX,
sec. 17(c), Constitution of the State of Alaska, from
the constitutional budget reserve fund; and providing
for an effective date."
HOUSE BILL NO. 40
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program, including
supplemental appropriations; and providing for an
effective date."
1:35:39 PM
^FY 20 BUDGET OVERVIEW: DEPARTMENT OF ADMINISTRATION
1:36:00 PM
CHERYL LOWENSTEIN, ADMINISTRATIVE SERVICES DIRECTOR,
DEPARTMENT OF ADMINISTRATION, OFFICE OF MANAGEMENT AND
BUDGET, OFFICE OF THE GOVERNOR, introduced a PowerPoint
presentation titled "FY2020 Governor's Amended Budget"
dated February 28, 2019 (copy on file). She began on slide
3 and reported that the Department of Administration's
(DOA) total budget in FY 19 was $343,978,500 and the
governor's proposed FY 20 budget was $374,977,200 (an
increase of $30,998,700). She referenced a chart on the
left showing a funding comparison. Federal funds made up a
small portion of the department's budget, totaling just
over $3.9 million in FY 19 and $4.1 million in FY 20. The
$200,000 (5 percent) increase was for a six-year grant for
the Office of Public Advocacy (OPA) to address the opioid
crisis.
Ms. Lowenstein moved to the "other" funds category (shown
in green) that was comprised of large buckets of funds. The
first was interagency (IA) receipts to charge other
agencies for DOA's service. She noted the difference
between FY 19 and FY 20 was minimal at a reduction of
$140,000.
Ms. Lowenstein reported that the second item included in
other funds was the Internal Services Fund used exclusively
by the Office of Information Technology, which totaled
$47,491,000 in FY 19 and $74,169,000 in FY 20. She
elaborated that the increase was just under $20 million and
was due to the integration of information technology (IT)
services. Some contracts had been consolidated in the
Office of Information Technology (OIT); those contracts
were paid in OIT and services were provided to agencies,
rather than agencies paying the costs directly (DOA charged
the cost back to the agencies). She highlighted a $15
million supplemental in FY 19 for the same reason. She
reported the expectation of 86 additional staff
transferring into OIT in FY 20 as part of the
consolidation. The third large consumer of other funds was
the Public Building Fund, which had a minimal difference of
$500 between FY 19 and FY 20. She explained that the
department used the funds to charge agencies for space in
DOA-owned state buildings.
1:39:31 PM
Vice-Chair Ortiz asked if Ms. Lowenstein was describing the
difference between other funds in the FY 19 management plan
and governor's amended budget for FY 20 ($234,578,000 and
$269,571,900 respectively).
Ms. Lowenstein replied in the affirmative.
Vice-Chair Ortiz asked if it was possible to see the
specific line item changes rather than receiving an oral
summary.
Ms. Lowenstein responded affirmatively.
LACEY SANDERS, BUDGET DIRECTOR, OFFICE OF MANAGEMENT AND
BUDGET, OFFICE OF THE GOVERNOR, noted that the details were
included in the subcommittee budget books provided by the
Legislative Finance Division. She explained that Ms.
Lowenstein was providing a high-level overview of the
changes.
Co-Chair Wilson referenced Shared Services and noted the
legislature had heard there would be substantial savings.
She remarked there were substantial funds moving back and
forth via interagency receipts and internal services. She
asked how legislators could determine how much money had
been spent in all of the different agencies compared to the
amount spent on the current consolidated structure. She
wondered if the transition was nearly finished.
Ms. Lowenstein responded that DOA had done some baselining
of costs for OIT and Shared Services. She highlighted costs
in personal services, contractual, travel, and other lines.
The department was in the process of bringing staff in and
looking at purchases done across agencies independently.
She explained there was an Investment Review Board (IRB)
where every contract or software purchase was reviewed in
order to see what people were using and whether items were
used by one or several departments. The idea was to locate
areas the department could consolidate prices or services
for a cheaper cost. She detailed that the process was
currently underway as DOA transferred staff in to DOA to
provide the same services they had received. There had been
some savings to date, but some savings would need to be
reinvested to improve IT services (e.g. in areas like IT
security, which needed improvement). In the future she
anticipated the savings.
1:42:43 PM
Co-Chair Wilson understood that aside from Shared Services
the administration was doing some other cost effective
measures. She believed several years earlier the
consolidation only pertained to IT. She asked for a
breakdown of all of the measures. She had heard the state
had not received the savings it anticipated with Shared
Services and that it may have resulted in less efficiency
in some agencies. She believed it was separate from other
measures aiming to purchase everything at the same place in
volume.
Ms. Lowenstein answered that Shared Services was the travel
and payables initiative, which included procurement. She
detailed that OIT was the IT consolidation, which was not
included under the Shared Services category. The department
had brought in most of the travel under Shared Services but
had left out confidential travel; once a confidential unit
had been established it could consider bringing in
confidential travel. The priority had been to bring in
regular travel. The department had been given staff that it
paid and issued a chargeback for. The department had not
been given overhead; it was finding receipts and fees to
offset the costs for the initiative.
Ms. Lowenstein continued that DOA had recently made an
investment in software to improve tracking of what it was
receiving (it had used email in the past). The department
was implementing a new process to reduce the time it took
to process travel by approximately 40 percent. She
elaborated that DOA was starting to gain and find
efficiencies to reduce its staff time and hopefully the
number of staff needed in the future. The department was
also beginning to bring the payables initiative in. She
relayed that DOA was still doing significant work to
consolidate those components.
1:45:17 PM
Co-Chair Wilson surmised that the efficiencies were not as
basic as the initial project she was recalling. She
remarked on the difficulty of following IA receipts. She
asked if the employees would eventually become DOA
employees, which would eliminate the need for chargebacks
[to other agencies]. She thought it would remove the
duplication processes related to funding.
Ms. Lowenstein replied that if DOA was 100 percent
successful, the only way it could abolish IA receipts would
be if it was able to find enough receipts to not charge
anything back for the service provided.
1:46:21 PM
Ms. Lowenstein continued to address the "other" fund
category on slide 3. The second to last large item in the
category was the department's retirement and benefit funds.
The budget included an increase in the area of
approximately $7.6 million. She detailed the amount
included $3.7 million for the second half of the employer
group waiver program that was adding Medicare Part D. She
explained the department had pharmaceutical rebates in the
past; adding Medicare Part D would increase rebates by $16
million to $23 million. Additionally, the change would
reduce the state assistance by $40 million to $52 million.
The department had put a number of contracts in place that
would result in savings of as much as $4 million on the
active side; once the contracts were farther along, DOA
could look at adding retirees, which would result in more
savings. She elaborated that the savings would go to the
AlaskaCare Health Trust.
Ms. Lowenstein addressed the last large item included in
the "other" funds category representing a change in the
chart was an increase of $851,000 to the Violent Crimes
Compensation Board funding (crime victim funds sourced from
the Permanent Fund Dividends garnished from felons). She
noted that HB 286 passed the legislature the previous year,
which increased the board's ability to receive and spend
receipts of $180,000. She expounded that the higher the
amount of the increase, the more money there was to
distribute across the agencies receiving funding.
Vice-Chair Johnston asked about the Medicare Part D related
to pharmaceuticals. She asked whether the savings was due
to a decrease in the cost of drugs or from the upfront
cashflow.
Ms. Lowenstein replied that the state was receiving more
revenues off the pharmaceuticals consumed by the people in
the health trust. She added that the state was receiving
$0.30 instead of $0.10.
Vice-Chair Johnston asked for verification the cash would
be received immediately instead of after 120 days as was
the current practice.
Ms. Lowenstein replied in the affirmative. She highlighted
that the department's projections were low compared to what
it was anticipating to collect; the amount was expected to
be a bit higher than what she had previously stated.
1:49:11 PM
Representative Sullivan-Leonard asked if the cost savings
would come from the new contract with the pharmacy benefit
managers.
Ms. Lowenstein replied the savings would come in the form
of federal reimbursement by adding Medicare Part D.
Representative Sullivan-Leonard surmised her previous
statement was not part of it.
Ms. Lowenstein agreed.
Ms. Lowenstein continued to address slide 3. The increase
in other funds from FY 19 to FY 20 was almost entirely due
to the Internal Services Fund for OIT in the amount of
$26.7 million, retirement and benefits at $7.6 million, and
the Violent Crimes Compensation Board at $800,000. The blue
portion of the bar [in the chart on the left] represented
the department's undesignated general fund (UGF) and
designated general funds (DGF). In FY 19, the total
$105,495,500 was made up of $72,517,000 UGF and $32,977,800
DGF. In FY 20, the total $101,300,000 was made up of
$68,307,100 UGF and $32,992,900 DGF (a reduction of
approximately $4.2 million). The largest consumers of UGF
were OPA and the Public Defender Agency at approximately 73
percent of the funds in FY 20. The largest consumer of DGF
was the Division of Motor Vehicles (DMV) at $16.7 million.
She reported that DMV returned $30 million to $40 million
annually to the General Fund.
Ms. Lowenstein moved to the chart on the right of slide 3
showing DOA's budgeted position comparisons between FY 19
and FY 20. The department had 1,245 positions in FY 19 and
1,263 in FY 20. She noted it was an increase of 18
positions overall. There were 19 positions increased in the
full-time category (shown in blue), 15 were due to staff
transferring in from the Department of Transportation and
Public Facilities to OIT, 6 staff were working for
retirement and benefits (with an offset of 3 non-permanent
positions), and the administrative services director and
one other position were being transferred out of DOA.
Co-Chair Wilson referenced Ms. Lowenstein's testimony that
DMV brought in the most revenue. She asked if the [per
person] cost selected to obtain a Real ID had hit the mark
compared to the cost of a regular driver's license.
Ms. Lowenstein replied that she did not have the
information and would follow up on the question.
Co-Chair Wilson was concerned about the scenario when
someone did not receive their driver's license [in the
mail] and the DMV did not know where it went because there
was no tracking system. She shared that her license had not
arrived, and she had called a couple of months later but
the DMV did not know where it had gone. She reported that
the FBI had subsequently found it on a person who had taken
licenses from numerous people. She elaborated that the only
offer she had received was to get her same driver's license
back with the same number on it. She wanted there to be a
process when someone else received a person's license. With
the Real ID requirement, she believed it was time for the
DMV to consider tracking mailed licenses or have
individuals pick up their license at the DMV. She did not
believe the regular mail kept licenses very secure. She
reported it had not made her feel good to know a thief had
been carrying her license in his pocket. She added she had
recently received a call from a person who had not received
their license in the mail and its whereabouts were unknown.
Ms. Lowenstein thanked Co-Chair Wilson for the comment.
1:53:39 PM
Representative Josephson spoke about the OPA and Public
Defender Agency budgets. He thought the Public Defender
Agency had been seeking 20 more public defenders. He did
not know if it correlated with the anticipated passage of
the governor's crime bill package. Instead of the 20
positions, the agency had received money for one-half to
one full position. He asked about the impact of passing the
governor's crime package on Public Defender Agency's
budget.
Ms. Lowenstein answered that she did not know the impact.
She was unsure the administration could articulate the
impact presently. The Public Defender Agency believed it
should be able to provide necessary services in the current
year. She reported that the appeals backlog would increase
some. She relayed that the DOA commissioner was dedicated
to looking at whether the agency's work was conducted most
efficiently and planned to act accordingly.
1:55:08 PM
Ms. Lowenstein moved to slide 4 and spoke to the General
Fund changes including the withdraw of the state grant for
Alaska Public Broadcasting television, radio, and satellite
services totaling $3,496.1 million GF and $100,000 IA.
Vice-Chair Ortiz asked what kind of analysis had been done
in the decision to make the $3.5 million reduction to
public broadcasting.
Ms. Sanders replied that when the administration had
reviewed the departments' budgets, it had prioritized each
department's core services. The administration had
determined that the grant was not statutorily required and
was not a core service.
Vice-Chair Ortiz asked if the presenters were aware of the
role public broadcasting played in rural communities
including emergency information broadcasting.
Ms. Lowenstein replied in the affirmative.
Vice-Chair Ortiz asked if the department had determined
that the emergency contact services were not essential.
Ms. Sanders clarified that the decision had been made by
the governor, not Ms. Lowenstein.
Vice-Chair Ortiz understood, but noted that Ms. Lowenstein
was the representative of the governor. He asked whether it
was deemed that emergency broadcasting services,
particularly in rural Alaska, were not essential.
Ms. Sanders replied that the services may be essential for
communities. She suggested that entities could look
elsewhere for funding if they chose to do so. She stated
that the funding had been identified as nonessential for
the core functions provided by DOA.
1:58:21 PM
Representative Sullivan-Leonard noted the particular item
had been looked at for reduction for years. She stated that
there had been ongoing discussions about other potential
funding sources at the local or tribal level. She asked if
other avenues had been explored and whether local entities
had been asked if they could help provide support.
Ms. Lowenstein answered that DOA distributed the grants and
public broadcasting was responsible for providing the
department with a list of recipients and the amount they
received. She reported DOA would be glad to help with the
transition in any way possible. She confirmed that the idea
was for public broadcasting to locate funding from other
sources.
Representative Sullivan-Leonard appreciated the response.
She was hearing more and more about the impacts at the
local level. She supported continuing discussions to assist
entities on the receiving end find other funding sources.
Co-Chair Foster asked for a list of all the grantees from
the past year.
Ms. Sanders agreed to provide the list.
Vice-Chair Ortiz asked if the funding was associated with
any federal matching funds from National Public Radio or
other.
Ms. Sanders was uncertain and would follow up on the
question.
Ms. Lowenstein believed there was some match funding for
public radio in particular. She believed the funding
represented 12 percent of the radio's overall funding.
Vice-Chair Ortiz asked for clarification that the money
represented some match potential for the radio stations. He
surmised that the opportunity cost was greater than $3.5
million because the federal funding would not come in.
Ms. Lowenstein answered in the affirmative.
Co-Chair Wilson asked if entities filled out paperwork
showing other fund sources when they applied for the state
grants. She did not believe it was necessarily federal
funding that required a match (it may or may not). She
relayed it would be helpful to see the overall funding
picture [for public broadcasting]. She believed the funds
represented a low percentage [of overall funds] for some
entities and a high percentage for entities in some rural
areas. She noted that not all federal funding required a
match; sometimes funds were received because of what an
organization was doing. Additionally, some of the funding
could be coming from communities or Native corporations. It
would be difficult for legislators to understand the
impacts without the entire picture.
Ms. Lowenstein replied that it was accurate. She noted that
if an entity was using state funds for a match, they could
use donations for a match instead. There were numerous ways
to look at the issue.
2:02:42 PM
Ms. Lowenstein addressed a statewide support executive
branch 50 percent travel reduction of $459,100 GF on slide
4 ($289,200 UGF and $169,900 DGF). The total reduction to
the department was $592,700.
Vice-Chair Ortiz asked how the reduction impacted the
department's ability to conduct carry out its duties and
obligations. He recognized that reducing travel appeared to
be a good thing at face value; however, he wondered if it
would have a specific impact on DOA's ability to fulfill
its duties.
Ms. Lowenstein answered that OPA and the Public Defender
Agency did not receive a 50 percent cut because of the work
the two agencies did. She could not speak to the
calculation, but the agencies had received the same number
as the Department of Law and the Department of Public
Safety. The department's commissioner was reviewing all
travel and denying anything that was not mission critical.
The department was looking at increasing videoconferencing
to help reduce travel at DOA and in other agencies.
2:04:48 PM
Vice-Chair Johnston asked if Ms. Lowenstein had identified
the Alaska Oil and Gas Conservation Commission (AOGCC) as
an agency receiving a [travel] reduction.
Ms. Lowenstein replied that AOGCC had also received a 50
percent travel reduction.
^FY 20 BUDGET OVERVIEW: OFFICE OF THE GOVERNOR
2:05:30 PM
SHAWN HENDERSON, ADMINISTRATIVE SERVICES DIRECTOR, OFFICE
OF THE GOVERNOR, provided a brief summary of the operations
of the Office of the Governor. He detailed that the office
exercised executive power of the State of Alaska as set out
in the Alaska Constitution and in statute. The office
included the Office of the Lieutenant Governor; the
Division of Elections responsible for overseeing statewide
elections; the Alaska Human Rights Commission tasked with
enforcing Alaska human rights laws; and the Office of
Management and Budget (OMB) that oversaw the preparation
and presentation of the governor's budget.
Mr. Henderson continued with the presentation above titled
"FY2020 Governor's Amended Budget" dated February 28, 2019
(copy on file). He began on slide 6 showing funding and
budgeted position comparisons. He pointed to the left
portion of the slide and reported that the total budget for
the Office of the Governor was increasing slightly from
$28,850,000 to $28,961,000. He detailed that there was GF
reduction from $27,781,700 to $24,747,600 (shown in blue).
Other funds increased from $838,300 to $3,984,700. He
reported that details on the increase would be shown on the
following slide. Federal funds were reduced by $1,000 from
FY 19 to FY 20.
Mr. Henderson directed attention to the budgeted position
comparison on the right side of the slide. There was no
change in the 23 nonpermanent positions. The full-time
positions would increase from 136 to 154.
2:09:20 PM
Mr. Henderson turned to slide 7 and addressed detailed
changes in the budget. The governor's office was proposing
to reduce its contingency fund by $300,000 GF. The fund was
originally $550,000 and the reduction would leave a
remaining balance of $250,000. He noted the item had been
discussed the previous year and he believed the reduction
represented a move in the right direction. The second
bullet highlighted the consolidation of administrative
services director (ASD) positions moving from the
departments to OMB. The cost was $2,706,000, which was
funded by Interagency (IA) receipts. The last bullet
reflected the decrease in executive branch travel by 50
percent totaling $618,700 GF.
Vice-Chair Johnston asked where the 13 positions had come
from [listed in the second bullet point on the slide].
Ms. Sanders replied that the 13 positions represented the
ASDs being transferred into OMB from each of the
departments.
Co-Chair Wilson noted slide 6 showed a position increase of
18. She asked for detail on the additional 5 positions.
Mr. Henderson explained that 13 of the positions were ASDs,
3 positions were from the Economic Development Council, and
2 positions were from the Department of Fish and Game
(DFG).
2:12:33 PM
Co-Chair Wilson asked why the administration was moving
vehicle rental tax to pay for the positions (as opposed to
UGF). She asked what the two positions from DFG were and
why they were being moved.
Ms. Sanders responded that the governor's budget included a
transfer of economic development functions from the
Department of Commerce, Community and Economic Development
(DCCED), including three positions and the associated
funding, to the Office of the Governor. There were other
functions that had been included in DCCED's Division of
Economic Development, which would be transferred to the
Division of Community and Regional Affairs. She explained
that the functions of the Division of Economic Development
would be transferred from the division. The DFG positions
proposed for transfer to the governor's office were two
division director positions that were vacant and no longer
being utilized in the department. She detailed that the
services and work being done by the Division of Habitat and
Division of Subsistence would continue, but the positions
had been identified as no longer necessary.
Co-Chair Wilson expressed concern about the proposal. She
wondered why the administration had not opted to delete the
positions from DFG if they were no longer needed and add
two new positions to the Office of the Governor. She
wondered if the governor was going to be doing something
different than before. She asked why the vacancy could not
be utilized.
Ms. Sanders replied that there were multiple ways to do
budget transactions. She explained that an increment and
decrement could have been utilized. Under the given
scenario, there were two division director positions and
associated funding available. She elaborated that the
positions were no longer needed in DFG and there was a need
in the Office of the Governor; therefore, a transfer had
been proposed.
Co-Chair Wilson was trying to figure out why the two new
positions were necessary. Additionally, she asked why
$108,000 had been taken from the vehicle rental tax. She
did not believe it was necessarily the right place to take
funding from.
2:15:29 PM
Ms. Sanders answered that the two new positions included a
budget director and deputy director within OMB. She
elaborated that OMB was consolidating ASDs and creating a
new way of functioning. The change required two new
positions. She explained that the two positions had been
identified as available and were transferred. The vehicle
rental taxes were appropriated to the Division of Economic
Development to work on tourism related functions within
DCCED. The functions were no longer occurring under DCCED
and had been moved to the Office of the Governor; the
associated funds had been transferred with the positions.
2:17:00 PM
Co-Chair Wilson believed the $108,000 had come around when
the department had Alaska Travel Industry Association
(ATIA) and a substantial amount of the functions. She was
uncertain whether all of the functions were still occurring
or whether the tourism industry had taken on the work. She
stated the $108,000 may or may not be doing the same
function. She was glad the ASDs had been brought together
because removed them from silos. She asked for more
information about why the change had been made and what the
benefits were of the communication between the ASDs.
Ms. Sanders answered that previously the ASDs worked within
their own agencies and were very focused on what their
agencies were doing and how they operated. The goal of
moving the positions was to bring the knowledge together to
determine how business could be done better as a state.
There were agencies utilizing systems that could benefit
other agencies. She explained that prior to moving the
positions to OMB, the discussions had not been taking
place. Through some of the proposals on the human resources
and procurement consolidations, the ASDs could pool their
knowledge to discuss what worked and did not work. The
prior consolidations of OIT and Shared Services were taking
significant time and were providing learning experiences
that could be applied to the human resources and
procurement consolidations to increase the speed and
success of the process.
2:19:24 PM
Representative Knopp was concerned about the consolidation
of the ASDs. He appreciated trying to find efficiencies. He
asked if the current number of ASDs would remain the same
over time or be reduced in the future.
Ms. Sanders responded it was too soon to say whether
positions would be reduced. The budget included the 13
positions that had been in the agencies. The administration
was working with ASDs to identify what duties and functions
they would continue. The administration believed it was
important that ASDs continued to keep their existing
relationships with their departments, which involved
participating in conversations within the departments (with
commissioners, deputy commissioners, and program
directors).
Representative Knopp stated the ASDs had support staff when
the positions were under the departments. He asked if the
support staff positions remained intact inside the
departments.
Ms. Sanders confirmed that the support staff positions,
including budget analysts and procurement staff, would stay
within the departments. The budget only moved the ASD
positions.
2:21:40 PM
Representative Josephson asked for verification that the 13
positions were now physically embedded in OMB and not in
the departments.
Ms. Sanders answered that the positions were physically
split between their departments and OMB. The individuals
maintained offices within their departments and OMB was
working on establishing space within its offices.
Representative Josephson was trying to determine how
spending part of their time in their department was any
different than it had been. He was aware that every
department was run by the executive branch and that
commissioners served at the pleasure of the governor. He
had heard ASDs referred to as directors of directors. He
imagined that if ASDs were embedded outside their own
departments, they must be receiving information over the
phone or by email. He was trying to get a sense of the
cultural change the move represented, particularly if the
ASDs had two offices.
Ms. Sanders replied that the administration's intent was
for ASDs to act as a conduit between agencies. The
directors would determine the best place to focus their
time given the circumstances. The idea was for the
directors to be a link between agencies and OMB as OMB
worked through larger projects, consolidations, and the
budget process. The ASDs would determine, to some extent,
where they needed to be at what time.
2:24:33 PM
Representative Josephson was trying to get a sense of the
direction the governor was going. For example, each
departmental budget included language where the legislature
authorized the movement of funds between appropriations. He
asked if the consolidation of the ASD positions under OMB
signaled a move by the administration to consolidate power.
Ms. Sanders replied in the negative. She stated that the
language Representative Josephson was referring to within
each agency was a proposal to allow the departments
(working with OMB and the ASD positions) to have
flexibility to move money between appropriations as the
administration was making large reductions throughout
departments. She communicated that the change was not
intended to be a power shift. The language had been used in
prior years, specifically in the Department of Health and
Social Services (DHSS) when large reductions had been made.
She communicated it had been a proposal to be able to have
flexibility as large reductions were being made throughout
the state.
2:26:12 PM
Vice-Chair Ortiz asked how bringing the ASDs into the
governor's office had impacted the role of the different
commissioners.
Ms. Sanders answered that she did not believe it had
changed the role of the ASDs or commissioners. She
elaborated that the commissioners, deputy commissioners,
program directors, and ASDs were all participating in the
conversations about the budget and the operations of their
departments. She stated that nothing had changed.
Vice-Chair Ortiz highlighted the [administration's]
decision related to education funding and asked if Ms.
Sanders was saying the Department of Education and Early
Development (DEED) commissioner had been on board.
Ms. Sanders answered that the commissioner had been a part
of the conversation and decisions.
Vice-Chair Ortiz stated that the impact of the decisions
had a direct influence on policy and the goal of improving
education. He asked if the decision to reduce funding for
the Base Student Allocation (BSA) was a decision to improve
education. He remarked that the job of the DEED
commissioner was ultimately to improve education.
2:29:04 PM
Ms. Sanders did not know how to answer the question because
she believed it may not be appropriate for her to speak to.
The job of the DEED commissioner was to support education
and find the best outcomes for the department. The decision
referenced by Vice-Chair Ortiz was a budget decision to
reduce the amount of funding that went out through K-12
education. She reported that the commissioner had been part
of the conversation.
Vice-Chair Johnston stated that she had been looking
forward to program budgeting from OMB. She asked if "this"
was going to provide the avenue to start seeing budgeting
through programs.
Ms. Sanders replied that OMB had produced priority program
matrixes for each of the departments, which would be
provided to committee members. She detailed that when the
budget had been developed, OMB had utilized the priority
programs and core services.
Vice-Chair Johnston clarified she was looking for a budget
based on programs. For example, there were programs for
ages zero to five that were in multiple departments. She
asked if the approach had started.
Ms. Sanders replied in the negative. The budget was based
on individual departments' core services. The
administration was looking at how programs were impacted
across agencies. She highlighted requested IT projects as
an example. She explained that the administration was
making sure that capital projects were a coordinated effort
if they impacted multiple agencies in any way (in order for
the software or system could be utilized across agencies).
2:31:29 PM
Vice-Chair Johnston asked if the two DFG positions were
funded through receipts or DGF.
Ms. Sanders replied the positions were funded with UGF, not
receipts.
Co-Chair Foster asked if there was anything further from
Mr. Henderson.
Mr. Henderson replied in the negative.
Representative Knopp saw a substantial increase in services
in the OMB budget. He asked what services fell under OMB.
Ms. Sanders replied that when the 13 ASD positions had been
transferred from their agencies, OMB had also added IA
receipt authority to address their services costs related
to computers, IT, and travel.
Representative Knopp asked if travel was a separate line
item.
Ms. Sanders answered in the affirmative.
2:33:22 PM
Co-Chair Wilson communicated her desire to have the
commissioners online during the budget discussions. She
wanted to hear from the individuals who would have to take
the numbers and make them a reality. She stated that the
public did not get to hear when questions were answered
with an email. She believed it would be helpful in
understanding what the decreases may or may not do.
Co-Chair Foster stated the preference was to have
individuals available in person, but if that was not
possible, they could be online.
Representative Josephson shared the request. He reported
that the Senate had also made the request.
Representative Knopp considered the budget comparison
between the December 15 versus the governor's amended
budget and the FY 18 actuals. He remarked that the numbers
were somewhat skewed if the goal was to compare the actuals
one year ago with the current numbers. He thought it was
necessary to look at the far left or right to get the true
increase or decrease percentages (when looking at what was
proposed instead of actuals). He noted it was substantially
different in some cases [note: Representative Knopp was
referencing data on the OMB website].
Co-Chair Wilson asked for clarification. She wondered if
Representative Knopp was stating that the charts were based
on the governor's December 15 budget. She corrected that
the charts in the presentation were to the FY 19 management
plan.
Representative Knopp spoke about the OMB component detail.
He looked at the numbers on the far right and noted the
percentages included the governor's proposed budget and
amended budget. He wanted to see the actuals from the past
year compared to the governor's amended budget instead of
including the December 15 budget.
Co-Chair Wilson believed Representative Knopp was referring
to the OMB website.
Representative Knopp confirmed he was looking at the
component details on the OMB website.
2:36:54 PM
Ms. Sanders answered that OMB and the Legislative Finance
Division could run specific reports with comparisons upon
request.
Co-Chair Foster reviewed the schedule for the following
day.
Representative LeBon asked about the date of the following
meeting.
Co-Chair Foster replied that the following meeting was
March 1, 2019.
ADJOURNMENT
2:38:19 PM
The meeting was adjourned at 2:38 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| FY2020 Gov Amend Budget to HFC 2.28.19 DOA GOV.pdf |
HFIN 2/28/2019 1:30:00 PM |
HFIN DOA/GOV Overview |
| APBC FY2019 Operating Grant Allocations.pdf |
HFIN 2/28/2019 1:30:00 PM |
Respnse to Q's HFIN |
| ARCS and the Satellite Service Information.pdf |
HFIN 2/28/2019 1:30:00 PM |
Respnse to Q's HFIN |
| Public Broadcasting Funding in Alaska - Impacts of 100% Reduction in Sta....pdf |
HFIN 2/28/2019 1:30:00 PM |
Respnse to Q's HFIN |
| Response to House Finance Questions 2.2128.19.pdf |
HFIN 2/28/2019 1:30:00 PM |
|
| WWAMI fact sheet final 2018.pdf |
HFIN 2/28/2019 1:30:00 PM |