Legislature(2019 - 2020)ADAMS ROOM 519
02/07/2020 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| Fy 21 Budget Overview: Department of Fish and Game | |
| SB74 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 205 | TELECONFERENCED | |
| += | HB 206 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 74 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
February 7, 2020
1:36 p.m.
1:36:42 PM
CALL TO ORDER
Co-Chair Foster called the House Finance Committee meeting
to order at 1:36 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 (via teleconference)
Representative Colleen Sullivan-Leonard
Representative Cathy Tilton
Representative Adam Wool
MEMBERS ABSENT
None
ALSO PRESENT
Dayna Mackey, Administrative Services Director, Department
of Fish and Game, Office of Management and Budget, Office
of the Governor; Samantha Gatton, Deputy Operations
Manager, Division of Administrative Services, Department of
Fish and Game; Maridon Boario, Staff, Senator Lyman
Hoffman; Heidi Teshner, Director, Finance and Support
Services, Department of Education and Early Development;
Patience Frederiksen, Director of Libraries, Archives and
Museums; Dr. Lisa Skiles Parady, Director, Alaska Council
of School Administrators; Representative Sara Rasmussen.
PRESENT VIA TELECONFERENCE
Doug Vincent-Lang, Commissioner, Department of Fish and
Game; Representative Kelly Merrick.
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.
CSSB 74(FIN)
INTERNET FOR SCHOOLS
CSSB 74(FIN) was HEARD and HELD in committee for
further consideration.
FY 21 BUDGET OVERVIEW: DEPARTMENT OF FISH AND GAME
Co-Chair Foster reviewed the agenda for the day. He invited
the testifiers from the Department of Fish and Game to the
table.
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."
^FY 21 BUDGET OVERVIEW: DEPARTMENT OF FISH AND GAME
1:38:47 PM
DOUG VINCENT-LANG, COMMISSIONER, DEPARTMENT OF FISH AND
GAME (via teleconference), introduced the PowerPoint
presentation: "FY 2021 Budget Overview: Department of Fish
and Game" (copy on file). He began with slide 2 titled The
Constitution of the State of Alaska, which reviewed the
portion of the states Constitution dealing with natural
resources as follows:
Article 8 Natural Resources; ? 4. Sustained Yield
Fish, forests, wildlife, grasslands, and all
other replenishable resources belonging to the
State shall be utilized, developed, and
maintained on the sustained yield principle,
subject to preferences among beneficial uses.
The Alaska Statutes
Title 16. FISH AND GAME; Sec. 16.05.020.
Functions of commissioner.
(2) manage, protect, maintain, improve, and
extend the fish, game, and aquatic plant
resources of the state in the interest of
the economy and general well- being of the
state.
Mission Statement
To protect, maintain, and improve the fish, game,
and aquatic plant resources of the state, and
manage their uses and development in the best
interest of the economy and the well-being of the
people of the state, consistent with the
sustained yield principle.
Commissioner Vincent-Lang turned to slide 3 titled " Alaska
Department of Fish and Game Core Services:
Management
Provide hunting and fishing opportunities,
protect state's rights to manage its fish
and wildlife resources, protect and improve
habitat and access.
Stock Assessment and Research
Ensure sustainability and harvestable surplus,
improve assessment and research capabilities,
invest in new technologies, anticipate changing
conditions.
Customer Service and Public Involvement
Make improvements to information and education
services, the Boards and other regulatory processes,
licensing and permitting.
1:40:52 PM
Commissioner Vincent-Lang continued to slide 4 titled
Alaska Department of Fish and Game Economic Value:
Sustainable Management of Fish and Wildlife Resources
means $12.4 billion dollars in economic value to
Alaska!
Commissioner Vincent-Lang added that the Department of Fish
and Game (DFG) managed the resources for sustainability and
yield, to provide an economic benefit, and improve the
wellbeing of Alaskans. He indicated that DFG received an
approximate annual budget of $200 million of which $65
million were either Unrestricted General Funds (UGF) or
General Funds (GF). The department turned the investment
into over $12 billion in economic value as follows:
Commercial Fisheries returned $5.6 billion; Sport Fishing
returned $1.9 billion; Wildlife $4.6 billion; and
Subsistence $0.3 billion.
Commissioner Vincent-Lang turned to Slide 5 titled "Alaska
Department of Fish and Game Regional and Area Offices."
showing the locations of regional and area offices within
the state. He spoke of the importance of serving remote
locations.
Commissioner Vincent-Lang highlighted slide 6 titled
Alaska Department of Fish and Game FY 2021 Operating
Budget Comparison, which displayed a bar chart of the FY
21 Operating Budget compared to previous management plans
in FY 19 and FY 20. He offered that the department reduced
GF in total by 4.2 percent between FY 19 and FY 21. He
noted that the reduction minimized the impact on
sustainability or investment returns. The department was
able to meet all constitutional, statutory, and regulatory
responsibilities.
1:42:08 PM
Commissioner Vincent-Lang moved to slide 7 titled "Alaska
Department of Fish and Game FY 2021 Fund Source Breakdown
by Fund Category. The slide depicted a pie chart of the
percentage of core services funded by GF for FY 21. He
noted that nearly half [46.3 percent] was expended on stock
assessment and research, approximately 30 percent [27.1]
went to management of surplus yields, and 20.2 percent to
customer service and public involvement. The slide also
contained a chart of DFGs funding streams. He reported
that over 70 percent of the budget was derived from non-GF
sources with the majority comprised of federal funds.
Commissioner Vincent-Lang continued to slide 8 titled
Department of Fish and Game Strategy for Reducing General
Fund Authority:
Least impact to return on investment
Availability of alternative funding
Opportunity to enter in new partnerships
Commissioner Vincent-Lang related that he had asked the
staff to evaluate DFGs programs according to the bullet
points listed on the slide. The department was asked to
identify programs that could save GF. He communicated that
since much of the Division of Commercial Fisheries was most
dependent on GF most of the impact fell on the division.
Commissioner Vincent-Lang reviewed Slide 9 titled "Alaska
Department of Fish and Game FY 2021 Operating Budget Change
Highlights:
Division of Commercial Fisheries
• Southeast Regions Fisheries Management, ($401.7)
UGF, (1) permanent part-time
$66.2 UGF and 1 permanent part-time
position reduction to close Wrangell Office
$19.9 UGF reduction to dive fishery stock
assessment
$315.6 UGF reduction to eliminate Southeast
red king crab assessment
• Central Region Fisheries Management, ($47.2) UGF
$47.2 UGF reduction to eliminate pike
suppression
• AYK Region Fisheries Management, ($299.6) UGF
$299.6 UGF reduction of Bering Sea salmon
research
• Westward Region Fisheries Management, ($123.2)
UGF
$23.2 UGF reduction of management of Frazer
Lake fish pass
$100.0 UGF reduction to Westward region
facility maintenance
• Statewide Fisheries Management, ($159.0) UGF, (1)
permanent full-time
$159.0 UGF and 1 permanent full-time
position reduction to aquaculture planning
and permitting
• Division of Sport Fisheries
$250.0 UGF reduction of support for license
modernization
• Boards of Fisheries and Game
$24.5 UGF reduction to travel for Boards
supplemental meetings
• Habitat Section
$24.0 UGF reduction to realize savings from
position changes
Commissioner Vincent-Lang remarked that the slide listed
the programs that were either eliminated or reduced. He
hoped to find additional grant money for the Central Region
pike suppression, Arctic-Yukon-Kuskokwim (AYK) Region,
Bering Sea salmon research, and Westward Region management
of Frazer Lake fish pass. He noted that the license
modernization program was currently operating on a grant
and was in the development stage. He offered that he would
seek operational money in the future. He concluded the
presentation.
1:46:05 PM
Representative Sullivan-Leonard asked why weirs were being
removed in the upper Cook Inlet. Commissioner Vincent-Lang
answered that the reduction happened in the prior year, but
the count took place because the weirs were already
operating. He relayed that the department was leaving one
of three weirs in place. The counts at the weir were used
for post-season assessments to determine how accurate the
management decisions were and would not affect in-season
management. He noted that he would be looking for
additional funding through partnerships to keep one of the
weirs open. He emphasized that the department could manage
the fisheries under the current Board of Fish management
plan guidance to meet escapement goals. Representative
Sullivan-Leonard relayed that she would be monitoring the
situation closely.
Commissioner Vincent-Lang thanked the committee and
welcomed further questions.
1:48:28 PM
Vice-Chair Ortiz referred to slide 9 and asked for the
total amount of the reductions for commercial fisheries.
Commissioner Vincent-Lang responded that it was about
$900,000. He deferred to the Administrative Services
Director.
DAYNA MACKEY, ADMINISTRATIVE SERVICES DIRECTOR, DEPARTMENT
OF FISH AND GAME, OFFICE OF MANAGEMENT AND BUDGET, OFFICE
OF THE GOVERNOR responded that the amount was approximately
$1.3 million.
Vice-Chair Ortiz asked whether the department analyzed the
impact of the $1.3 million cut on the $5.6 billion return
on investment cited on slide 4. Commissioner Vincent-Lang
replied that the largest impact would be from the
elimination of the Southeast red king crab fishery. He
noted that the fishery only occurred about 25 percent of
the time over a decade. The department chose to cut from
the Southeast red king crab assessment rather than from a
fishery like Bristol Bay, which occurred annually. He
offered to provide the return on investment figure for the
years the red king crab fishery operated.
1:51:02 PM
Vice-Chair Ortiz thought that eliminating the red king crab
assessment would prevent a personal use fishery from
happening. He asked whether his statement was correct.
Commissioner Vincent-Lang responded that it would not
impact subsistence fisheries. Vice-Chair Ortiz clarified
that it would impact the personal use fishery. Commissioner
Vincent-Lang agreed with the statement. Vice-Chair Ortiz
wondered how many personal use fishers would be impacted.
Commissioner Vincent-Lang did not know and offered to
provide the answer later. He furthered that his goal was to
explore opportunities for using alternative options like
designing a fishery that would allow DFG to collect
assessment through a commissioners permit. The permit
would allow the department to use the fishery to obtain
stock assessment information in a manner that allowed
informed fishery management decisions for future openings.
He noted that currently ADFG used the approach in Adak and
Prince Willian Sound with Tanner crab.
Vice-Chair Ortiz asked about a $19.9 thousand UGF reduction
to the dive fishery stock assessment under the same
Southeast Region list. He asked who would be impacted by
the dive fishery reduction. Commissioner Vincent-Lang
answered that the reduction impacted dive fisheries for
Geoduck and Sea cucumbers, among others. Typically, the
department sent divers down to make an assessment. He
wanted to partner with the fisheries divers to design a
program that helped with the assessment as a way to keep
the fishery open. He did not have the statistics for the
number of people impacted but would provide the
information. Vice-Chair Ortiz asked for clarification by
what the commissioner meant by help with the assessment.
He inquired whether he wanted the divers to share the cost
of the assessment and pay additional landing taxes.
Commissioner Vincent-Lang responded affirmatively.
1:53:48 PM
Vice-Chair Ortiz asked about the closure of the office in
Wrangell due to a lack of use. He shared that he had
information that showed the office was heavily used. He
asked for an explanation. Commissioner Vincent-Lang
responded that he might have misspoke. He intended to say
that the office was little used for the management of
fisheries. He pointed out that DFG could manage the areas
fisheries just as easily out of Petersburg. The department
was modernizing its licensing through electronic licensing.
He argued that given the proximity to Petersburg, the
Wrangell office could be closed without impacting stock
assessment and management. He acknowledged that the office
was heavily used by the community.
1:54:58 PM
AT EASE
1:55:30 PM
RECONVENED
Co-Chair Foster reported that Representative Merrick had
joined the committee meeting online.
Co-Chair Johnston asked Commissioner Vincent-Lang to
explain what the Sustainable Salmon Fund was.
1:56:50 PM
Commissioner Vincent-Lang clarified that the fund was a
federal grant program focused on sustaining Alaskas salmon
runs and protecting habitats. The fund allowed the
department some flexibility in making awards for things it
determined were priorities for sustaining Alaskas salmon
resources. He related that the fund was used for pike
suppression in relation to sport fishing and he wanted to
expand it to protect commercial sockeye fisheries. Co-Chair
Johnston asked for the annual amount of the grant.
Commissioner Vincent-Lang could not recall the total sum of
the project. He would provide the information. Co-Chair
Johnston asked whether all the grant money was encumbered
by other projects. Commissioner Vincent-Lang replied that
all the funds were awarded as grants in the prior year. He
furthered that he had the opportunity to shape the grant
into the future for priorities and planned to reshape it
into priorities for UGF items that were reduced in the
budget process.
Co-Chair Johnston wondered whether the state had matching
money for the Pitman Robertson funds. Commissioner Vincent-
Lang responded that he thought the department had a good
process in place to ensure funding would not be lost in the
future. He recalled that millions of dollars had reverted
in previous years. He indicated that part of the
departments strategy was to pursue grant proposals from
the public for improved hunter access across the state. The
grantees would provide the matching funds. The option had
helped to spend down some of the excess funds. Co-Chair
Johnston recognized the value of the fund.
1:59:08 PM
Representative Wool queried about the 2 positions that were
eliminated in the aquaculture planning and permitting under
Statewide Fisheries Management. Commissioner Vincent-Lang
responded that the person occupying one of the positions
was retiring. The position will not be filled, and the
responsibilities will be reassigned within the program. He
was assured by the division that mariculture planning and
permitting will not be impacted. He viewed mariculture as
an additional way to provide economic opportunity for the
state.
Representative Wool clarified that the House recently
passed a mariculture bill that supported and encouraged the
industry. He asked whether the commissioner was referring
specifically to mariculture and not aquaculture.
Commissioner Vincent-Lang responded in the affirmative.
2:00:35 PM
Representative Knopp asked about a reduction of $250,000
for license modernization. He asked if the funding had to
do with HB 260 (Fish & Game Licenses; Electronic Form)
{Chapter 54 SLA 18 07/13/2018] that was adopted in
February 2018. Commissioner Vincent-Lang explained that the
reduction was money set aside to maintain the program after
it was developed. He hoped that the amount to maintain
electronic licensing would not be close to $250,000. The
development funding was still available, and the department
planned to move forward with electronic licensing.
Representative Knopp expressed concern that the project was
not moving along very far. He recalled that the intent of
the bill was to create an electronic display and he
understood that the design was going a lot further. He was
concerned with the projects slow progress in two years and
wondered when it would be completed. Commissioner Vincent-
Lang indicated that within the year phone displayed
licenses should be ready. The new application would also
include harvest reporting and other items associated with
licensing. Representative Knopp reiterated his concern.
2:03:28 PM
Representative Wool relayed that when he went to get a
license at a retail store, an employee had to manually
enter in all the data, which was time consuming. He asked
if that reflected an improvement or was part of
modernization. Commissioner Vincent-Lang suggested that
electronic licensing should make it easier for the user to
apply online at home by entering all the necessary data. He
suggested that having a vendors employee enter data
remained more efficient that using paper books where the
department had to transfer all the information into the
data base.
SAMANTHA GATTON, DEPUTY OPERATIONS MANAGER, DIVISION OF
ADMINISTRATIVE SERVICES, DEPARTMENT OF FISH AND GAME,
interjected that for the prior two years DFG was
transitioning to paperless licensing. Currently, stores and
entities were in the process of complying, using the
departments paperless application and licensing system
called eVendor. The department was providing training and
was no longer sending paper booklets to license vendors.
The licensee's drivers license was scanned, and the entire
transaction was done electronically. She added that the
system realized a cost saving for the department.
Representative Wool suggested that the system was too
cumbersome for an eVendor and some vendors might decide it
was not worth offering licenses. He stated that a license
could not be issued at home because a license needed to be
verified. He thought going into the DFG office might be
more efficient but not convenient. He asked whether the
department received any pushback from retail vendors who
thought the process involved too much work.
2:06:52 PM
Ms. Gatton responded that the retailers and entities
enjoyed the process. She indicated that the vendors were
compensated and received $1 for every application.
Eliminating the paper saved the vendors time as well. She
qualified that the system was still a work in progress.
Commissioner Vincent-Lang offered that a person had the
option to go online to apply for a license making it easier
for the end user. Representative Wool appreciated the
information.
2:07:57 PM
Representative Josephson looked at what had been removed
from the operating budget by the veto and restored from the
prior year. He noted that the vetoes maintained the
reduction of roughly $1 million from the Division of
Commercial Fisheries and was currently proposing an
additional cut of about $1 million. He inquired whether the
department received feedback on the prior years cuts.
Commissioner Vincent-Lang answered that he had not heard
much feedback. He deduced that since the vetoes occurred in
August many of the reduced items were already operational
and services were continued. He thought that the impact
would be felt in the current years upcoming field season.
He informed the committee that the department had already
discussed partnership opportunities with the Bristol Bay
Science Partnership to cover some of the work impacted by
the reductions. He endeavored to continue mission critical
work through partnerships, other opportunities, and federal
funding. Representative Josephson wondered whether the full
weight of the cuts would be felt in the upcoming fishing
season. He asked whether the commissioner was concerned
over the cuts. Commissioner Vincent-Lang stated that he
could manage the departments mission critical functions
and constitutional and statutory duties with the budget
that was passed.
2:10:11 PM
Vice-Chair Ortiz understood that commercial fishing and DFG
was down by over 20 percent UGF since 2015. He shared that
at the time he became a legislator, the department had a
stellar reputation with Alaska having world class managed
fisheries. He stressed that the effort took investment and
believed that the reduction in the investment over time had
an impact on the ability for DFG to maintain its status. He
cited the return on investment by commercial fisheries on
slide 4 as $5.6 billion. He surmised that as the state
moved forward the market for Alaskas seafood products
would increase as the worlds population grew. He thought
that in order to protect Alaskas current economic value
and invest in the growth potential it was
counterproductive to continue to reduce DFG support.
Commissioner Vincent-Lang responded that because of tough
financial times, the department has had to tighten its belt
in ways that did not impact the core of the program. He
believed that the core of the program remained strong and
was convinced the department remained a world class
fisheries organization and was a model to others. He
acknowledged that impacts would be felt but, overall, he
was confident the department would be able to continue to
fulfill its mission and provide a good return on
investment.
2:13:33 PM
Vice-Chair Ortiz related concerns he discovered during the
prior fishing season. He indicated that there was a
significant overestimate of the return of chum salmon
throughout the state, which particularly impacted Southeast
Alaska. The overestimate had a significant impact on the
regions gillnetters and Seine fleet. He continued that no
one at DFG had been able to explain the over-estimation. He
suggested that an increase in the budget might be warranted
in cases where errors in estimates or other management
decisions occurred to determine the causes. Commissioner
Vincent-Lang answered that it was clear that the
overestimation had to do with something interrupting the
fishery out in the ocean. He reported that the department
reprioritized a fisheries scientist to study ocean
survival questions. Currently, the department was
developing a plan to better understand the problem. He
believed that the department could not find the answer
alone and needed to engage in partnerships and find federal
or other dollars to find the answer.
2:16:10 PM
Representative Wool asked about the department's hatchery
investments. He asked about investment trends and whether
the department was trying to supplement the lacking
numbers of fish. Commissioner Vincent-Lang asked a
clarifying question. He inquired whether Representative
Wool was speaking to private nonprofit hatcheries across
the state or the sportfish state hatcheries. Representative
Wool responded that he was more interested in the private
hatcheries. He was unfamiliar with how the private
nonprofit hatcheries operated. Commissioner Vincent-Lang
stated that the private nonprofit hatcheries were producing
significant amounts of fish. One question was whether the
pink or chum hatchery fish were straying and impacting
Alaska's wild stocks. He mentioned an article he had
written about 6 months prior discussing his cautionary
approach that would not permit increased pink and chum
salmon releases until the wild stock issue was understood.
He noted that work was underway to study the issue in
cooperation with private industry and was two or three
years into a five year study. Hatchery production for sport
and commercial fisheries was important for times of low
wild stocks but he cautioned that a careful measured
approach to avoid impacts on wild stocks was warranted.
Co-Chair Foster thanked the commissioner and the other
testifiers.
HB 205 was HEARD and HELD in committee for further
consideration.
HB 206 was HEARD and HELD in committee for further
consideration.
2:18:59 PM
AT EASE
2:20:05 PM
RECONVENED
CS FOR SENATE BILL NO. 74(FIN)
"An Act relating to funding for Internet services for
school districts; and providing for an effective
date."
2:20:22 PM
Co-Chair Johnston relayed that the committee had already
heard the bill during the prior session.
2:20:42 PM
MARIDON BOARIO, STAFF, SENATOR LYMAN HOFFMAN, provided a
brief review of the bill. She highlighted that SB 74
increased the broadband requirement for schools from 10
megabits per second (Mbps) to 25 Mbps of download speed and
provided the funding through the School Broadband
Assistance Grant (BAG). Schools applied for a subsidy
commonly known as "E-rate," that provided discounts of up
to 90 percent of the schools internet costs and the BAG
grant helped cover the remainder of the costs. She reported
that about 170 schools in 30 school districts around the
state would be impacted.
Co-Chair Johnston noted that Representative Sara Rasmussen
had joined the meeting.
2:21:50 PM
Representative LeBon asked if some schools were being left
out of the program. Ms. Boario responded that any school
that still operated under 25 Mbps were included. She noted
that some schools already had access to higher bandwidths.
Representative LeBon asked whether all schools would be at
a minimum of 25 Mbps and would be satisfied if the bill
passed. Ms. Boario responded that the increase was a
start.
2:23:04 PM
Vice-Chair Ortiz asked if all schools in Alaska would be
bumped up to 25 Mbps. Ms. Boario responded that 172 schools
were not at 25 Mbps and would be covered under the bill.
2:23:57 PM
Representative Josephson inquired whether the money would
supplant the money schools were currently spending on
bandwidth. He wondered if schools would see a savings or an
offset of funds for other purposes due to the program. Ms.
Boario responded that currently a school applied for the
federal grant program and a school district paid for the
difference. The bill allowed for a school to apply for the
increased bandwidth through the federal program and the BAG
grant would cover the remaining costs.
Co-Chair Johnston interjected that the Department of
Education and Early Development (DEED) would explain the
program further.
2:25:46 PM
Representative Knopp recalled a discussion he had
previously with a representative from GCI explaining the
satellite technology and informing him that the
infrastructure to increase the schools bandwidth was
already in place. He was concerned about the $7 million
cost considering the current fiscal situation. He suggested
that internet rates tend to increase and worried about the
state sustaining the cost into the future. He was uncertain
of his support for the bill.
Co-Chair Johnston commented about an article from the
Alaska Journal of Commerce. She shared that Alaskas first
low orbital satellite was going into operation in the
current year that could possibly provide 80 Mbps to
everyone in the entire state. She believed that it would be
a game-changer. She invited DEED to report on the
disparity test and discuss the fiscal note.
2:29:09 PM
PATIENCE FREDERIKSEN, DIRECTOR OF LIBRARIES, ARCHIVES AND
MUSEUMS, Department of Education and Early Development,
introduced herself and reported that the fiscal note was
approximately $7 million, which was necessary to serve all
the schools at 25 Mbps. She explained that the program was
in existence since FY 2015. Every year the number of
schools participating in the program was reduced. The
schools discovered through the bid process that it was
possible to get over 10 megabits at a lower cost than the
amount of the BAG grant. Each year the number of schools
needing the grant to get to 10 megabits decreased. She
expected the scenario to keep repeating going forward. She
expounded that as the broadband infrastructure in the state
grew it increased bandwidth and lowered the cost of
internet. She thought that the 10 megabit BAG program would
wither away. The program started at 135 schools in 2016 and
was currently down to 72 schools needing support in 2020.
She thought the current trajectory would continue with the
25 Mbps program.
2:31:57 PM
Representative Carpenter noted that she had reported a
decline in the 10 Mbps recipients. He wondered why
participation decreased, if the price was declining or the
school districts had budgeted more money for internet. Ms.
Frederiksen reported that she was certain that it was due
to the decreasing costs of internet in rural areas. She
added that the program was strictly set at 10 Mbps and the
schools could get higher amounts for less. Representative
Carpenter wondered whether the schools currently paying for
25 Mbps or higher that were not currently on the list could
apply for the program. Ms. Frederiksen responded that
eligibility was established at under 25 Mbps. Schools at 25
Mbps or above were ineligible for the program. She
anticipated that 173 schools were eligible to receive
assistance to get to 25 megabits. Representative Carpenter
deduced that some schools were paying for their own
internet and the state was paying for up to 25 megabits of
internet for other schools. Ms. Frederiksen responded that
the BAG program was freezing a schools internet bill.
She provided an example of a school paying $1 thousand per
month for 20 Mbps. The BAG program was freezing the
schools bill at the 20 Mbps cost and BAG was paying the
remainder to 25 Mbps in combination with the E-rate. The
schools bills would not increase through the life of the
program. She related the same was true for the 72 remaining
schools in the 10 Mbps program; their bills were frozen at
2014 levels and the E-rate and BAG programs were paying the
rest of the bill.
2:35:26 PM
Representative Knopp looked at the situation in a different
way. He suggested that the schools and state would stay on
the program indefinitely if 25 Mbps was the highest amount
of bandwidth available.
2:36:29 PM
Ms. Frederiksen explained the ways eligibility for the
program was certified. The school district would apply for
every school operating under 25 Mbps. The superintendent
certified the application with their signature and
submitted the application. The district simultaneously
applied for the federal E-rate program. The departments E-
rate coordinator reviewed the E-rate applications. The E-
rate paid 70 percent to 90 percent of the bill for
internet. She emphasized that both applications were
scrutinized. The penalty for false information on the E-
rate application could prohibit a school from receiving the
E-rate. Representative Knopp was not suggesting any
questionable behavior would take place. He voiced that if
25 Mbps was the highest bandwidth available in the state, a
school could not purchase a higher amount at a reduced rate
like the schools currently paying for their own bandwidth
at 15 Mbps instead of remaining in the BAG program at 10
Mbps. Under the 25 Mbps scenario, participants would not
drop out of the program if it were the highest bandwidth
available in the state under the current infrastructure.
Ms. Frederiksen believed that there were areas in Alaska
where higher than 25 megabits was available. She reported
that it depended on the pressure from each school. She
determined that if a school discovered 40 Mbps was
available in their area and they could afford to pay for it
with their own resources and the E-rate, they would likely
exit the BAG program. She stated that the upward pressure
for more bandwidth from schools and libraries was
unstoppable due to advances in technology.
Co-Chair Johnston reiterated the low orbit information she
shared earlier in the meeting.
2:40:04 PM
Representative Carpenter remembered in the prior year 25
Mbps was considered a benchmark. He reasoned that in the
future the benchmark would grow higher and the demand due
to new technology would require an increase above 25 Mbps
bringing additional costs. Currently, 25 Mbps was a mid-
level of the amount the schools would need. Ms.
Frederiksen replied that the amount was a very basic level
of bandwidth. She elucidated that the more students,
internet testing, and distance education the more bandwidth
was necessary. The 25 Mbps amount was the Federal
Communications Commission (FCC) standard, but the
commission was moving beyond the figure in other states
where bandwidth was easily accessible. The low orbit
satellites would bring more competition in rural areas that
would draw prices down. The satellite and other providers
would be in competition for schools. The e-rate had been
designed to create the infrastructure and progress
bandwidth development around the country. The state of
Alaska would never be on the cutting edge of bandwidth.
She deemed that currently, 25 Mbps would be a boon to the
schools but in 5 or 10 years the schools would want more.
Representative Wool referred to the rate sheet [FY 2019
School BAG Awards by District and School (copy on file)]
in members packets and asked whether the costs were based
on 10 Mbps. He provided Whittier as an example. Ms.
Frederiksen answered in the affirmative. She added that the
table showed the annual cost of internet for each school,
the E-rate paid portion, the school paid portion, and the
BAG portion.
2:43:10 PM
Representative Wool guessed that the rate for 25 Mbps was
higher and as bandwidth increases content increases. He
imagined the demand would continue to grow. He wondered if
the school would pay the entire cost of internet if there
was higher bandwidth available. Ms. Frederiksen explained
that prior to School BAG the districts paid for internet
from a combination of E-rate ranging from 70 to 90 percent
and the districts funding. The BAG was an additional
source of funding to meet the internet needs. She
delineated that if the cost of internet were to decrease
and a district wanted to increase over 25 Mbps the district
would exit the BAG program if they could afford it. She
reminded the committee that the district would continue to
receive E-rate subsidies.
2:45:08 PM
Representative Wool clarified that E-rates would continue
to be available. He observed that no matter how much band-
width was available and competition increased, his cell
phone and internet bill always increased. He was looking
forward to new satellites, but he did not think internet
costs would decrease especially for rural districts.
Co-Chair Johnston requested discussion concerning the
disparity test.
HEIDI TESHNER, DIRECTOR, FINANCE AND SUPPORT SERVICES,
DEPARTMENT OF EDUCATION AND EARLY DEVELOPMENT, pointed to
Section 2 and Section 3 of the bill and noted that they
addressed conditional language. She reported that the
department worked with the federal Department of Education
on the disparity test and received confirmation that the E-
rate was excluded from the calculation. She elaborated that
the issues in the prior spring regarding the disparity test
were addressed.
Co-Chair Johnston asked about the filing window. Ms.
Frederiksen responded that the filing window for the
federal E-rate awards was March 27, 2020. The regulations
had been re-drafted and there were a couple of date issues
that were necessary to address. The department was ready to
address the school BAG regulations with the state Board of
Education during the March 26, 2020 meeting.
2:48:18 PM
Co-Chair Johnston asked whether the department would take
the new BAG provisions to the state Board of Education if
the bill was adopted and signed by the governor by March
26, 2020. Ms. Frederiksen confirmed that it would take the
regulations before the board for approval.
Co-Chair Johnston hoped that the state would make the
deadline.
2:48:57 PM
Representative Wool asked how many of the schools on the
2019 list had the 25 Mbps increase available to them. Ms.
Frederiksen responded that she did not know the answer. She
elaborated that with the inception of the 10 Mbps program
many schools could not receive 10 Mbps in the first year of
the program. The vendors had to insert some hardware into
their networks and the schools need additional hardware.
The highest number of participants was in FY 16. She
relayed testimony from the prior year from Christine
O'Conner, Alaska Telecommunications Association, stating
that 25 Mbps would be available statewide.
2:50:40 PM
DR. LISA SKILES PARADY, DIRECTOR, ALASKA COUNCIL OF SCHOOL
ADMINISTRATORS, related that she was working with the
internet providers and assured that 25 MBPS would be
available to all the schools on the list.
2:51:07 PM
Representative Josephson requested the matching amount for
the E-rate. Dr. Parady responded that it was up to a 9 to 1
match.
Ms. Frederiksen interjected that the amount of E-rate
awarded a school was based on its school lunch program and
the poverty rate. She noted that one school in Unalaska
only received 50 percent but most of the schools received
80-90 percent. Representative Josephson asked what sort of
federal resources the $7 million fiscal note would bring.
Ms. Frederiksen replied that the E-rate at 86 percent was
approximately $84.3 million. Representative Josephson
mentioned the deadline and noted that $84 million was at
stake. Ms. Frederiksen responded in the affirmative. She
noted that the school districts would need to reapply, and
she was uncertain how long that could take. The problem was
that the legislature's schedule was similar to the E-rate
application schedule. The department would work arduously
on its end to help facilitate the process.
2:53:41 PM
Representative Wool noted that $86 million would be coming
to the state to internet providers who would greatly
benefit from the program. Ms. Frederiksen responded
affirmatively. Representative Wool asked if the E-rate
contribution could change at the federal level. Ms.
Frederiksen responded in the negative. She indicated that
most other schools received a higher level of E-rate
because costs were lower in the rest of the country. The E-
rate program wanted Alaska to receive higher bandwidth.
2:54:37 PM
Co-Chair Johnston noted the slight increase from the
previous year on the fiscal note and wondered why. Ms.
Frederiksen recalled that the services line increased but
was unclear why. The School BAG program paid for the E-rate
coordinator and some other services. Co-Chair Johnston
asked Ms. Frederiksen to get back to the committee with the
answer.
Ms. Teshner interjected that the reason was reported on the
fiscal note analysis. She communicated that the increase
was for increased contractual hours and technical review of
applications by DEEDs contractor.
Co-Chair Johnston indicated amendments were due by Monday,
February 10th.
CSSB 74(FIN) was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
2:56:18 PM
The meeting was adjourned at 2:56 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Deptartment of Fish and Game FY21 Budget Overview 2.7.20.pdf |
HFIN 2/7/2020 1:30:00 PM |
|
| FY21 Pacific Coastal Salmon Recovery Fund Cap Request.pdf |
HFIN 2/7/2020 1:30:00 PM |
ADFG Response HFIN Overview |
| ADF&G Response to HFIN Hearing 2.7.20.pdf |
HFIN 2/7/2020 1:30:00 PM |