Legislature(2021 - 2022)ADAMS 519
03/11/2021 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB68 || HB84 | |
| Overview: Supplemental Bills by Office of Management and Budget | |
| HB76 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 68 | TELECONFERENCED | |
| += | HB 84 | TELECONFERENCED | |
| + | HB 76 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
March 11, 2021
1:32 p.m.
1:32:16 PM
CALL TO ORDER
Co-Chair Merrick called the House Finance Committee meeting
to order at 1:32 p.m.
MEMBERS PRESENT
Representative Neal Foster, Co-Chair
Representative Kelly Merrick, Co-Chair
Representative Dan Ortiz, Vice-Chair
Representative Ben Carpenter
Representative Bryce Edgmon
Representative DeLena Johnson
Representative Andy Josephson
Representative Bart LeBon
Representative Sara Rasmussen
Representative Steve Thompson
Representative Adam Wool
MEMBERS ABSENT
None
ALSO PRESENT
Neil Steininger, Director, Office of Management and Budget,
Office of the Governor; Representative Tiffany Zulkosky,
Co-Chair, House Health and Social Services Committee;
Representative Liz Snyder Co-Chair, House Health and Social
Services Committee.
PRESENT VIA TELECONFERENCE
Heidi Hedberg, Director, Division of Public Health,
Department of Health and Social Services; Susan Pollard,
Assistant Attorney General, Department of Law.
SUMMARY
HB 68 APPROP: SUPPLEMENTAL; AMENDING
HB 68 was HEARD and HELD in committee for further
consideration.
HB 76 EXTENDING COVID 19 DISASTER EMERGENCY
HB 76 was HEARD and HELD in committee for further
consideration.
HB 84 APPROP: SUPP; REAPPROP; AMENDING; CBR
HB 84 was HEARD and HELD in committee for further
consideration.
OVERVIEW: SUPPLEMENTAL BILLS BY OFFICE OF MANAGEMENT AND
BUDGET
Co-Chair Foster reviewed the meeting agenda.
HOUSE BILL NO. 68
"An Act making supplemental appropriations; amending
appropriations; and providing for an effective date."
HOUSE BILL NO. 84
"An Act making supplemental appropriations,
reappropriations, and other appropriations; 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."
1:33:10 PM
^OVERVIEW: SUPPLEMENTAL BILLS BY OFFICE OF MANAGEMENT AND
BUDGET
1:33:16 PM
Co-Chair Merrick provided information about the meeting
documents.
NEIL STEININGER, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, introduced a PowerPoint
presentation titled "State of Alaska Office of Management
and Budget: FY2021 House Finance Supplemental Budget
Overview," dated March 11, 2021 (copy on file). He shared
that supplemental items were funding requests for the
current fiscal year and generally included items where an
unanticipated need arose after the legislature finalized
the appropriation process in the prior year. He began on
slide 2 and spoke to elements of supplemental bills. The
fast track supplemental bill addressed high priority
projects and completion of the FY 21 capital budget. He
explained that when the legislature had adjourned early the
past year, it had passed an operating budget that did not
include all of the capital projects. Some capital projects
were accommodated through the RPL [revised program
legislative] process, but some of the items were ineligible
for that process. The fast track bill also included other
items with urgent supplemental needs or needs the
administration had prioritized in December.
Mr. Steininger continued to review the elements of the
supplemental bills on slide 2. He relayed that HB 69 and HB
70 included technical supplemental items, which primarily
related to FY 22, but for technical reasons the
appropriations were effective in FY 21. He relayed that HB
84 was the normal supplemental bill, which included
requests the administration had not been aware of in
December or were slightly less urgent than items introduced
in December.
Mr. Steininger addressed slide 3 showing a table titled
"FY2021 Supplemental Summary." The first section of the
table reflected the fast track supplemental. He detailed
that the lion's share of the funding request fell under the
statewide category for the completion of the FY 21
Permanent Fund Dividend (PFD) payment of $1.2 billion.
Additionally, $53.4 million went to the completion of the
capital budget. The fast track also included a handful of
agency operating items.
Mr. Steininger continued to address the supplemental
summary table on slide 3. He relayed that most of the items
in HB 69 and HB 70 were more technical in nature. He
referenced a couple of negative funding numbers within the
section. He explained that the negative numbers reflected a
situation where a capital project had come in under budget;
therefore, the funding was repealed and reappropriated for
another use. He pointed to a -$12.8 million in the capital
line and $12.8 million in the statewide line. The action
removed the amount from a capital project that no longer
needed funding and deposited it into a fund.
Representative Josephson asked which fund Mr. Steininger
was referencing.
Mr. Steininger answered the administration had primarily
recommended a deposit into the Alaska Capital Income Fund.
Additionally, there were capital requests in the 2022
capital budget spending out of the Capital Income Fund on
deferred maintenance.
1:38:32 PM
Mr. Steininger referenced a spreadsheet titled "FY2021
Supplemental Bill Summary," dated February 2, 2021 (copy on
file).
Co-Chair Merrick noted the document was located under the
summary tab in members' black binders.
Mr. Steininger stated the document looked similar to slide
3 in the presentation and was eight pages in length. He
began on line 3 and highlighted a supplemental request to
address a school finance and facilities shortfall. He
explained that when the School Bond Debt Reimbursement
program was vetoed, funding for school finance activities
was inadvertently eliminated. The issue had been addressed
in the governor's FY 22 budget. The item on line 3
backfilled the funding for FY 21.
Co-Chair Merrick directed members to the spreadsheet tab in
their binders.
Mr. Steininger moved to line 4 showing a reduction to the
amount available in the Alaska Technical and Vocational
Education Program (TVEP) funding. He elaborated that the
TVEP funding had been reduced due to a lack of collections
in the fund. He noted there would be negative supplemental
items to reflect the reduction in collections to avoid
inadvertently overbudgeting from the fund in FY 21.
1:40:40 PM
Vice-Chair Ortiz looked at line 3 associated with funds the
legislature had appropriated for school bond debt
reimbursement. He understood the funds represented a
restoration of funds the governor had vetoed. He asked if
the original appropriation would have come from general
funds, but the supplemental appropriation would come out of
the school fund.
Mr. Steininger explained that the facilities section within
the Department of Education and Early Development (DEED)
had been funded through a transfer from the school bond
debt program in the past. He detailed that the school bond
debt program was paid for with a combination of the school
fund and unrestricted general funds (UGF). The proposal
shown on the spreadsheet used the school fund to cover the
facilities payments. He referenced the historical funding
method for facilities activities and noted that the
activities were not all associated with the school bond
debt program. The activities were associated with
maintaining major maintenance lists and school facilities
conditions and working with districts on facilities needs.
He explained that budgeting the item within school bond
debt was not putting the cost in the program it was
serving. Therefore, the administration had transferred the
funding out of the school bond debt reimbursement program
in the FY 22 budget and directly budgeted for the expense
in school finance and facilities to ensure the connection
to school bond debt did not create any problems in future
years.
Vice-Chair Ortiz asked about the net impact of the specific
transfer. He asked if any municipalities had benefitted
from the process that took place after the veto occurred.
Alternatively, he wondered if only the state had
benefitted.
1:43:17 PM
Mr. Steininger replied that the staff supported by the
$928,000 performed work that benefitted districts. The
staff reviewed applications for school major maintenance
funding, reviewed backlog lists of maintenance needs at
school districts, and other work assisting districts and
Regional Educational Attendance Areas (REAA) with facility-
related activity.
Vice-Chair Ortiz clarified that the idea behind school bond
debt reimbursement was to help municipalities with their
bond indebtedness. He asked for verification that none of
the municipalities actually received any help with their
bond indebtedness related to the specific item [on line 3
of the spreadsheet].
Mr. Steininger answered in the affirmative. He stated that
the school bond debt program had been vetoed. The
activities performed by the individuals funded through
school bond debt in prior years was not necessarily
associated with the school bond debt program.
Mr. Steininger moved to line 5 showing a $13.5 million
appropriation for the PFD hold harmless program. He
elaborated that the funding would ensure the hold harmless
program was sufficiently funded to complete the fiscal year
2021 dividend payment. He relayed lines 6 and 7 were
related to the TVEP program shortfall addressed earlier. He
moved to an increment on line 8 for operational support at
Alaska Vocational Technical Center (AVTEC). He elaborated
that AVTEC had seen substantial revenue shortfalls due to
COVID; however, COVID relief from the federal government
had not been sufficient to offset the shortfalls.
1:45:22 PM
Representative Josephson looked at the PFD hold harmless
program on line 5. He asked if line 5 would be moot if the
legislature did not appropriate the $1.2 billion to
complete the statutory dividend.
Mr. Steininger replied affirmatively.
Mr. Steininger briefly noted that item 9 related to the
TVEP distribution. He moved to items in the capital numbers
section of the fast track supplemental bill. He began with
a replacement system for the Division of Retirement and
benefits on line 13. He detailed the division was currently
replacing two of its system servers that were close to end
of support. The increment was $230,000 in retirement system
funds. Line 14 included $7.7 million in federal receipts
related to the Pacific Salmon Treaty Chinook Fishery
Mitigation. He elaborated that the item was related to an
RPL that placed money in FY 21 for one fiscal year. The
increment would allow the money to move into the capital
budget for use across several years (the full time period
of the federal grant). Line 15 included a $500,000
appropriation for the Department of Fish and Game (DFG)
from the Capital Income Fund for vessel, facilities, and
aircraft maintenance. Line 16 included an increment for DFG
for the Sportfish Recreational Boating and Angler Access
Program. He expounded that the program used a significant
amount of federal receipts with matching funds coming from
the Fish and Game Fund. He noted the Fish and Game Fund was
not eligible for the RPL process, which is the reason the
funding was not done over the summer.
1:47:41 PM
Mr. Steininger moved to line 17 on page 2 related to the
Wildlife Management Research and Hunting Access program
within DFG. The increment was federal funding matched by
the Fish and Game Fund and Statutory designated program
receipts (third-party contributions to the projects). Line
18 included a capital project to access money in the
Election Fund that was provided under the Coronavirus Aid,
Relief, and Economic Security (CARES) Act. He explained
that because expenditures from the Election Fund were not
eligible for the RPL process, the funds had been deposited
but had been inaccessible. He elaborated that during the
intervening time period the Division of Elections utilized
its existing operating appropriation to achieve the goals
of election security the funds were intended for. The
supplemental request was needed in order to transfer the
expenditures to a capital project and maintain operations
through the remainder of the fiscal year.
Representative Josephson recalled during the RPL period in
the summer of 2020 there were COVID relief funds available
for state elections that the state had waived at the time.
He recalled discussing the issue with colleagues. He asked
if it was the same money that the state was receiving
belatedly.
Mr. Steininger confirmed that the monies were the same. He
detailed that the CARES Act had included funding for making
the election safe for COVID. The federal guidelines
required the money to be deposited into the Election Fund
in each state. He explained that the election fund could
not be spent through the RPL process. The money had been
deposited, but the state had been unable to spend it. The
Division of Elections had used funds from its general
operating appropriations for elections safety. He
elaborated that the supplemental increment would let the
division transfer the expenditures into the capital project
for COVID security of elections and use the money to
continue operations.
1:50:50 PM
Mr. Steininger moved to line 19 showing a statewide
deferred maintenance increment funded with the Capital
Income Fund. He noted that the $5.9 million listed was
significantly less than the FY 21 capital budget request.
He explained there was not enough time left in the year to
obligate the entirety of the funding. The increment
reflected the available funding in 2021 and if the fast
track supplemental bill was appropriated quickly, some
projects could be obligated going into the summer season.
Mr. Steininger reviewed a $4 million increment for
prosecutor recruitment and housing to address sexual
assault and sexual abuse of a minor case backlogs on line
20. He noted there was also $3 million in the Department of
Law (DOL) base budget for prosecutor salaries.
Representative Rasmussen asked if item 20 pertained to
prosecutors hired in FY 21 or for new positions that had
not yet been filled.
Mr. Steininger replied that DOL was looking to create a
surge of hiring of new prosecutors to address the backlog
and the specific type of cases. He elaborated that the
capital project would give the initial money in FY 21 once
appropriated. The budget requests for FY 22 going forward
paid for ongoing salary costs. The increment [on line 20]
helped with the initial hiring influx.
Representative Rasmussen asked about the number of
positions the department was looking to add.
Mr. Steininger believed it was 34 positions with support
staff. He would follow up with the precise number.
Representative Josephson expressed support for the
increment, but not the funding source. He asked how he
would explain to education advocates that $4 million [in
higher education funding] should be used for a different
purpose.
Mr. Steininger replied that the budgets, particularly the
supplemental, had been built with the understanding there
was constraint on the balance of the Constitutional Budget
Reserve (CBR). He explained that the prior appropriation
bill did not include available UGF CBR headroom to make
supplemental appropriations; therefore, the administration
had used less traditional fund sources. He stated that
while the proposal was not a designated use of the Higher
Education Fund, it was still subject to appropriation
controlled by the legislature. He stated the importance of
addressing the backlog and explained that the
administration had utilized available fund sources to meet
supplemental needs. He remarked that some of the fund
sources may not match up perfectly.
1:54:52 PM
Representative Rasmussen considered that while paying the
increment [on line 20] from the Higher Education Fund may
not align perfectly, she thought it could be appropriate
because it addressed the abuse of minors. She had been told
by advocate groups that some of cases involving kids were
delayed up to five or more years, which was lengthy and
traumatic for children. She stated that the trauma could
have long lasting impacts on children. She saw the
increment as a possibility to eliminate some of the long-
term effects due to delayed cases. She reasoned it would
contribute to their higher education at some point.
Representative LeBon asked if it impacted the university
scholarship program, Alaska performance scholarships, or
Washington, Wyoming, Alaska, Montana, and Idaho (WWAMI)
programs.
Mr. Steininger answered there was no plan to reduce funding
for the scholarship programs, but it did utilize the fund
source that paid for the programs.
Representative LeBon thought it was hard to reconcile that
the use of funds would not have a long-term impact on the
programs in some way.
Mr. Steininger explained that for several years the Higher
Education Fund had been on a trajectory of appropriating
slightly more than its earnings. The balance was declining
over a long period of time. He stated that the proposed use
[on line 20] did not undermine the programs. He noted it
was not a principal and income type of fund.
Representative LeBon suspected the administration took the
position that the scenario should be a one-time only event.
Mr. Steininger answered the increment was a one-time
implementation cost.
1:57:35 PM
Representative Wool asked if there were other places where
the proposed budget utilized funds for something outside
their original intent. He referenced past testimony from
the Alaska Mental Health Trust Authority (AMHTA) about the
use of its funds. He characterized the use of funds for
something other than their intended purpose as breaking the
rules.
Mr. Steininger would note the fund sources throughout the
presentation. He pointed to an increment on page 1, line 8
for the Alaska Vocational Technical Center (AVTEC) backfill
and noted the funding source was Alaska Housing Capital
Corporation (AHCC) receipts. He explained the AHCC was
effectively a savings account with no designation of its
purpose. He stated that the administration utilized some of
the fund sources in the supplemental to avoid the CBR
headroom issue.
Representative Wool recalled seeing the previous day that
the Power Cost Equalization (PCE) Fund had been used for
something outside its intended purpose. He observed that
the issue appeared to be happening in multiple places.
Representative Josephson thought he heard Mr. Steininger
state that the Higher Education Fund was suffering anyway,
therefore using a little more from the fund would not
matter. He did not believe that was how Mr. Steininger
meant it, but it was the way he had heard it.
Mr. Steininger replied that it was not how he had meant the
statement. He clarified that sometimes designated funds
used for a specific purpose made it appear that the program
was not a General Fund cost. In the case of the Higher
Education Fund because the real value of the fund was
declining over time, those uses needed to be considered as
priorities against other General Fund spending. The
scholarship programs mentioned by Representative LeBon were
priorities that had been fully funded in the budget
regardless of the declining real value of the fund. In the
case of the Higher Education Fund, the question of the
priority was whether the scholarship program was a greater
priority than the health of the fund. He believed the
scholarships were the priority and the fund was a mechanism
that showed the expenditure as a designated general fund
(DGF) cost rather than a General Fund cost.
Co-Chair Merrick asked members to hold questions until the
end.
Vice-Chair Ortiz asked if the bar on eligibility had been
raised for the scholarships or if there had been a decline
in the number of awarded scholarships due to the decline in
the balance of the Higher Education Fund.
Mr. Steininger would follow up on the question.
2:02:28 PM
Mr. Steininger moved to an appropriation on line 21 for the
Department of Military and Veterans Affairs (DMVA) for
security upgrades at the Vessel Readiness Center. Line 22
included an appropriation to the Vessel Readiness Center
for water systems sustainment upgrades. Line 23 contained
an increment for the Kotzebue Readiness Center HVAC system.
Line 24 included an appropriation for roof, envelope, and
fall protection for DMVA facilities statewide. Line 25
included an appropriation to the Department of Natural
Resources for the Parks Land and Water Conservation Fund
federal grant program. He noted the program had been
included in the FY 21 capital budget, but it had not been
appropriated. The item leveraged substantial federal funds
but required state match. Line 26 was an appropriation for
the Geological Materials Center multispectral scanning
equipment. He remarked that the increment had been proposed
in FY 21, but not appropriated.
Mr. Steininger advanced to line 27 on slide 3. The
appropriation for the Department of Transportation and
Public Facilities was for the decommissioning and
remediation of Class V injection wells. The increment was
$1.7 million funded with Alaska Housing Finance Corporation
(AHFC) dividends. Line 28 was public building fund deferred
maintenance renovation and repair. The increment was annual
deferred maintenance costs of just under $6 million for
public buildings that was not appropriated in the capital
budget the previous year. Line 29 included an appropriation
for court security improvements throughout the state to be
paid with AHFC dividends. Line 30 included an appropriation
to address deferred maintenance improvements for court
facilities throughout the state to be paid from the Alaska
Capital Income Fund (the fund source traditionally used for
deferred maintenance).
Mr. Steininger moved to an increment for the operations of
the Alaska Psychiatric Institute (API) on line 34. The
governor's budget recommended paying the $6 million
increment with Alaska Mental Health Trust Authority (AMHTA)
reserves. Line 38 was a capital project for the Department
of Revenue utilizing $10 million in program receipts
collected by the Child Support Services Division and $15.5
million in federal receipts to replace the division's aging
case management system. He noted the operating budget
included some reductions the division would be able to take
by moving off of the mainframe system. He remarked that
there was a significant cost to the initial upgrade;
however, there were ongoing operating savings and the
system needed to be replaced.
2:05:35 PM
Mr. Steininger began addressing items in the regular
supplemental bill. He described the items as less urgent,
or the administration had not been aware of them in
December. Line 42 was related to the transition to biweekly
payroll. He explained the transition had increased the cost
of state employees' salaries by less than half a percent.
In order to accommodate some of the increases in agency
budgets, the administration was reducing the rate charged
by the Division of Personnel and Labor Relations that
applied across all payroll throughout the state. He
elaborated that the transition to biweekly generated
efficiencies and savings within payroll processing and
human relations (HR) work. The HR work would be centralized
in the Division of Personnel and all of the savings that
offset the salary cost for agencies would be borne within
the division. He relayed that the savings would take time
to implement; therefore, in order to make certain the
immediate cost impact did not come at a cost to
programmatic delivery, the rate was reduced immediately. He
noted it required some backfill of General Fund cost within
the division to ensure its mission was completed. The
change would reduce agencies' rates by $2 million, but the
savings could not be implemented immediately. As a result,
the budget included $1.65 million in General Fund costs
within the division. The change ensured agencies were not
harmed by the policy decision to move to biweekly payroll.
2:07:50 PM
Mr. Steininger moved to a $411,700 UGF to offset revenue
deficits in professional licensing programs on line 43. He
expounded that during COVID, fee increases to professional
licensing were suspended, which had caused some of the
licensing boards to go into a deficit in license
collections. The increment aimed to offset impacts to the
licensing boards.
Representative Josephson asked why the item would not be
payable with federal sources.
Mr. Steininger answered that the CARES Act COVID Relief
Funds (CRF) could not be used for revenue replacement. The
new federal stimulus package included a stipulation
specifying the funding could not be used for an intentional
decrease in a tax or fee or to avoid a tax increase. He
explained that the increment pertained to a policy decision
not to increase or change fees for professional licensing;
therefore, the federal funds could not be used to cover the
expense.
Mr. Steininger moved to line 44. He explained that the
Department of Environmental Conservation (DEC) had
implemented some energy savings efficiency projects. He
elaborated there was a state program allowing the borrowing
of funds for energy efficiency upgrades on state facilities
if the cost of debt was entirely covered by the energy cost
savings. The department had taken advantage of the program;
however, there had been delays in implementing the
retrofits primarily due to COVID. Therefore, the department
was unable to fully pay down the debt in the first year;
there was a $70,000 difference between the energy savings
and the cost of the debt.
Mr. Steininger addressed appropriations for DEC on lines 45
and 46 pertaining to environmental health and water
quality. He detailed there were unanticipated legal
expenditures as a result of enforcement cases the
department was required to pay to the Department of Law
(DOL). He explained that the cost was for services for DEC;
therefore, the supplemental increment was in the DEC budget
and not the DOL budget. Line 47 included a $590,000
appropriation to the Office of the Governor for the
Division of Elections reflecting the match portion of the
COVID relief funding from the CARES Act to the Election
Fund. Line 48 included an appropriation just under $3
million for subsidized adoptions and guardianships. He
detailed the funding had a $275,000 General Fund match. The
item reflected an increase in the number of children being
adopted or in permanent guardianships.
2:11:17 PM
Mr. Steininger advanced to a $1.2 million increment on line
49 for the Adult Public Assistance program to adjust for a
calculation for the maintenance of effort to support the
Medicaid program. The increment was required in order for
the state to continue collecting federal funding for the
Medicaid program. Line 50 included $1.2 million in federal
receipts for increased federal participation in some of the
maintenance costs at Army Guard facilities. Line 51 was
$130,000 for risk management of physical and digital risks
within the Department of Revenue. Line 52 reflected an
adjustment to the estimate for investment management fees
at the Alaska Permanent Fund Corporation (APFC) under DOR.
He detailed that $50 million was necessary due to higher
returns than anticipated when the corporation had budgeted
for its management fees.
Mr. Steininger moved to capital items within the regular
supplemental bill beginning on line 56. Line 56 included an
appropriation of $200,000 for the Alaska Energy Authority
(AEA) Electrical Emergencies Program. Line 57 included a
$330,000 appropriation for the Mount Edgecumbe high school
master plan update from the school fund. He detailed that
the school fund was a dedicated fund that could only be
used for school facility related purposes. Line 58 included
an increment for the Department of Education and Early
Development to create a new database to track school
facility conditions. Lines 59 and 60 within DEC were both
related to increases in the match required for increased
awards through the Village Safe Water Programs (for
expansions and upgrades and first time service projects).
The increments only included the General Fund portion
because the department had existing authority to collect
the increased awards.
2:13:52 PM
Mr. Steininger moved to an appropriation on line 61 to
enhance capacity at the Geological Material Center paid for
by a third party that would utilize the capacity to store
its own samples. Line 62 included $49,000 for Exxon Valdez
Oil Spill Outreach through the Exxon Valdez Oil Spill
Trustee Council. Line 63 was $750,000 for new subdivision
development to bolster land sales by the Department of
Natural Resources.
Mr. Steininger moved to the operating language section in
the fast track supplemental bill beginning on line 69. The
increment on line 69 included $4 million related to outside
counsel and other activities necessary to support statehood
defense related to Alaska's statehood rights for natural
resources.
2:15:05 PM
Representative Josephson observed the document contained
AHFC as a fund source for numerous items. He asked how AHFC
may feel about the proposed use of funds. He remarked he
was seeing many unusual fund sources listed in the
document.
Mr. Steininger answered that the fund source was the AHFC
dividend paid annually to the state. He explained that
typically the AHFC dividend was appropriated for capital
projects. He detailed that by appropriating the dividend
for capital projects, AHFC was able to hold onto the cash
for continued investment and to distribute the funding when
projects needed the funding. He relayed that AHFC strongly
preferred for the funds to be used for capital spending. He
explained that the previous year when only part of the
capital budget was funded, AHFC dividends had not been
fully expended. He reported that dividends that were not
fully expended on capital projects were deposited into the
General Fund per the appropriation language. He noted when
the funds were deposited into the General Fund, they
generally were swept into the CBR. He reiterated that AHFC
preferred the dividends to be used for capital projects,
which enabled the corporation to continue to manage the
funds and theoretically should increase dividends in future
years.
Representative Josephson asked for verification there was
nothing about the fund sources that were akin to the
discussion of the AMHTA or AIDEA fund sources. He asked if
the proposed use of the AHFC dividends was customary.
Mr. Steininger answered in the affirmative. He stated it
was customary to utilize the corporation's dividend, not
other funds held by the corporation.
2:17:41 PM
Mr. Steininger informed committee members that the
increment on line 69 also used the existing balance of the
Investment Loss Trust Fund. He remarked that the account
collected money over time and had a small balance.
Mr. Steininger moved to a $1.2 billion increment on line 70
to complete the FY 21 statutory PFD paid in July 2020. Line
74 included $2,300 for a grant to the Blood Bank of Alaska.
Line 75 was a reappropriation of a prior capital project to
be used for tax expertise and economic impact analysis by
the Department of Revenue. He explained that as tax
proposals were made, the department needed to bring in
expertise to analyze the proposals within Alaska's fiscal
picture. Line 79 was a technical item related to the
Division of Risk Management and the Catastrophic Reserve
Account [lapse balance appropriation]. He explained that
the specific budget method had been used in the past [Note:
see description on page 6 of the spreadsheet for more
detail] and it appeared to be an omission from the
operating budgets. He elaborated that as the administration
was looking at Catastrophe Reserve Fund bill currently
before the legislature, it realized the appropriation was
necessary to affect the current statute.
Mr. Steininger moved to an appropriation for the smoothing
of chargeback rates on line 80. He noted the rates had been
discussed by the Office of Management and Budget in a
recent House Finance Committee meeting. The increment would
stabilize the rate charges year over year. Line 81 was
language for the Department of Health and Social Services
Medicaid Services to allow money saved in the Medicaid
program to roll into FY 22. The increment would allow the
program additional time to negotiate with stakeholders on
the Medicaid budget. The item used funds offset by the
increase in federal participation in the Medicaid program
to carry into the following fiscal year. He noted that
since the item had been proposed, the increased federal
participation had been extended through the end of the
current calendar year and savings would continue into the
next year. Line 82 reflected an amendment to the Commercial
Vessel Passenger Tax appropriation. He explained the
appropriation was responsible for sending head tax dollars
out to the first ports of call where cruise ships docked.
He expounded that when reviewing the budget from the
previous year, the administration had found a typo in the
year referenced, which would have double spent collections
from two years back. The item corrected the error and
adjusted the estimate from ~$21.3 million to zero to
reflect the amount collected in the past year.
2:21:48 PM
Mr. Steininger highlighted that line 83 was an estimated
deposit into the Disaster Relief Fund. He detailed there
were appropriations for COVID disaster relief to the
Department of Health and Social Services totaling $90
million between two appropriations. The administration did
not believe the entire amount was needed for COVID relief
and was proposing to deposit $30 million of the total into
the Disaster Relief Fund. The funds would accommodate known
costs related to prior disasters in recent years, not
necessarily related to COVID. The action would bring the
fund back to a healthy balance.
Mr. Steininger moved to a fund transfer of $12.75 million
in prior capital projects that had been completed under
budget. The remaining funds would be deposited into the
Capital Income Fund. The money would be redeployed for
deferred maintenance in the capital budget. Line 88
included a small reappropriation of unexpended balances on
capital projects from cruise ship head tax. The money would
go back into the [Commercial Passenger Vessel Tax] account.
Line 89 included repeals of other Department of
Transportation and Public Facilities capital projects
associated with the deposit into the Capital Income Fund,
in addition to some repeals of existing projects that were
appropriated from the Capital Income Fund. He noted the
money would lapse back into the fund.
Mr. Steininger reviewed an item related to a settlement
against the state from a Disability Law Center judgement on
line 93. The increment was $7.35 million in general funds
and $4.5 million in federal matching funds to programs
created for FY 21 under the settlement.
2:24:03 PM
Mr. Steininger highlighted five other judgements,
settlements, or claims totaling $366,000 UGF on line 94.
Line 98 reflected an amendment to the Natural Petroleum
Reserve-Alaska (NPRA) Impact Grant Program. The increment
of $17.9 million would be adjusted to the amount actually
received for the program by the Department of Commerce,
Community and Economic Development. Line 99 was a technical
item to reassign old appropriations initially for the
Department of Administration to the Department of Military
and Veterans Affairs as a result of the transfer of the
Alaska Land Mobile Radio System (ALMR) program. Page 8 of
the spreadsheet showed a summary line with the cost of
total supplemental items.
Vice-Chair Ortiz looked at lines 82 and 88 related to the
Commercial Passenger Vessel Tax. He asked for verification
the increments would reinstate funds to the Commercial
Passenger Vessel Fund.
Mr. Steininger answered that the smaller increment of
$8,600 would lapse back into the Commercial Passenger
Vessel Fund. The $21.3 million was to adjust the projected
expenditures from the previous year's budget to the actual
distribution. He noted there had been a very minimal amount
collected the previous year.
Vice-Chair Ortiz looked at line 82 and asked if
expenditures from the fund had been projected at $21.2
million, but the expenditures had not actually occurred.
Mr. Steininger agreed. He explained that the state had been
projected to receive enough head tax revenue to pay out the
distribution and the number had not been adjusted at the
end of session the previous year.
Representative Johnson asked a question about lines 80 and
81 on page 7.
Mr. Steininger answered there were not amounts associated
with items on lines 80 and 81 because they were estimated
amounts and not additive spending. He elaborated that line
81 related to existing appropriations for general funds to
Medicaid Services. The administration was looking to use
the existing $35 million appropriation and extend the lapse
date. Line 80 allowed existing unexpended appropriations in
FY 21 to lapse into an appropriation for rate smoothing. He
clarified that numbers were not included for lines 80 and
81 to avoid duplicate counting.
Representative Johnson looked at lines 45 and 46. She asked
if legal expenditures related to a municipal government or
private individual.
Mr. Steininger deferred to the Department of Law or the
Department of Environmental Conservation for details on the
case.
Representative Johnson wanted to ensure the state was
spending funds on legal efforts in the right place.
2:29:18 PM
Co-Chair Merrick asked Mr. Steininger to review governor
amendments.
Mr. Steininger referenced a one-page document titled
"FY2021 Supplemental Governor Amended," dated February 16,
2021 (copy on file). Lines 1, 3, 4, and 5 were all related
to the Technical Vocational Education Program (TVEP)
distribution. He noted the previous spreadsheet discussed
showed reductions to the TVEP distribution. Subsequent to
the release, the department had looked at revenues coming
in for the program. He explained that incoming revenues had
been fairly volatile given COVID and the employment
situation in the state. He explained that revenues had been
adjusted up, but there was still a net reduction in
collections to the fund.
Co-Chair Merrick directed members to the appropriate
location in their budget binders.
Mr. Steininger highlighted a fund source change on line 2
in the Department of Environmental Conservation. He
explained that shellfish testing had been funded using
cruise ship head tax dollars; however, the Department of
Law (DOL) believed the fund use may conflict with the
commerce clause in the U.S. Constitution. As a result, the
administration was replacing the funds with UGF. There was
a similar budget item in the DEC FY 22 operating budget.
Vice-Chair Ortiz asked how long cruise ship passenger
vessel taxes had been used to fund the shellfish testing
program. He wondered why the concern had only recently been
raised by DOL if the fund use had been occurring for a
number of years.
Mr. Steininger answered that it had been used for several
years and he knew it had been a concern; therefore, the
administration was proposing to fix the issue. He did not
know why the adjustment had not been made in prior years.
2:32:00 PM
Mr. Steininger noted that lines 3 through 5 were related to
the TVEP distribution. Line 6 was a technical adjustment.
He elaborated that prior OMB reports reflected some UGF
costs associated with one of the General Fund
appropriations to the Department of Health and Social
Services for COVID relief. Subsequent to the reports, the
administration realized the costs should be applied to
federal funds through the CARES Act. Lines 7 and 8 were
repeals of capital projects completed under budget. He
explained that line 7 reappropriated the funds back to the
General Fund. He noted that the amounts could be deposited
into another fund like the Capital Income Fund. Line 8
reappropriated funds back into the Capital Income Fund. He
noted the funding came from a prior project from the fund;
therefore, the reappropriated funding could be used for
deferred maintenance needs in the future.
Representative Wool asked about the TVEP funding change. He
asked if it was because the Unemployment Insurance Fund
contained less funding than anticipated due to COVID and
unemployment claims.
Mr. Steininger answered that the TVEP Fund was funded
through payroll taxes. He explained that due to the
pandemic's impact on the employment situation over the past
year, the tax had varied significantly from initial
estimates. He detailed that the administration had put
together the negative adjustments in December.
Subsequently, the department had observed revenues were
increasing more than projected, which resulted in the
adjustments reflected in the spreadsheet.
Representative Josephson returned to the spreadsheet
related to the supplemental bills. He referenced page 7,
line 94 related to judgements, settlements, and claims. He
pointed to an increment of $197,000 on the Recall Dunleavy.
He asked if the expense was borne by the Division of
Elections. He asked for detail.
Mr. Steininger answered that cost would be a General Fund
appropriation to the Department of Law to pay the
settlement. He noted the item did not run through the
Division of Elections.
Representative Josephson asked why the increment
description included "DOE."
Mr. Steininger answered that the information provided in
the description reflected parties included in the case
name.
Representative Josephson asked if the money was designed to
make DOL whole for defending the Recall Dunleavy lawsuit.
Mr. Steininger clarified that the increment would pay the
prevailing party from the settlement or judgement.
2:35:44 PM
Representative Josephson thought the decision was a policy
call. He asked for verification that the cost could have
been paid by fundraising or the state.
Mr. Steininger answered that the item was a judgement or
settlement against the state and the amount was an
obligation owed by the state.
Representative Edgmon asked about page 7, line 83 [related
to the Disaster Relief Fund]. He asked if the item was a
lookback in FY 21. He referenced Senate Bill 241 and the
Disaster Declaration Fund where the legislature had
authorized a $10 million limit. He referenced SB 56 and HB
76 that included $10 million to extend the disaster
declaration and would be before the committee for
consideration soon. He asked how the $30 million on line 83
interplayed with the other aforementioned items.
Mr. Steininger thought it may help to provide a bit more
about the Disaster Relief Fund. He clarified that the $30
million [on line 83] would not be utilized for COVID
related disaster spending. The purpose of the increment was
to return the fund balance to a sufficient level in order
to respond to other disasters occurring in the intervening
time period. He reported there were still costs associated
with the Anchorage earthquake from several years back.
Additionally, there were costs associated with more recent
earthquakes, fires, and a variety of other small disasters.
He relayed that as of a couple of weeks earlier the balance
of the fund was ~$2.7 million, which was not considered to
be a comfortable balance. The $30 million would ensure
needs were met for existing disaster spending through the
following fiscal year. He noted that the $5 million deposit
made the previous year associated with the pandemic and the
$10 million cap set under SB 241 would not be impacted by
the deposit.
Representative Edgmon asked for verification that the
spending of the $30 million would be governed by disaster
declarations issued by the administration.
Mr. Steininger replied in the affirmative.
Co-Chair Merrick thanked Mr. Steininger for his
presentation.
HB 68 was HEARD and HELD in committee for further
consideration.
HB 84 was HEARD and HELD in committee for further
consideration.
2:39:41 PM
AT EASE
2:44:47 PM
RECONVENED
HOUSE BILL NO. 76
"An Act extending the January 15, 2021, governor's
declaration of a public health disaster emergency in
response to the novel coronavirus disease (COVID-19)
pandemic; providing for a financing plan; making
temporary changes to state law in response to the
COVID-19 outbreak in the following areas: occupational
and professional licensing, practice, and billing;
telehealth; fingerprinting requirements for health
care providers; charitable gaming and online ticket
sales; access to federal stabilization funds; wills;
unfair or deceptive trade practices; and meetings of
shareholders; and providing for an effective date."
2:44:59 PM
Co-Chair Merrick remarked that the legislature and the
public had talked extensively about the topic during the
current legislative session. She asked committee members to
recognize that each committee focused on different aspects
of legislation throughout the process. She recognized that
the bill would have significant impacts for the health and
safety of Alaskans. She reported that the House Finance
Committee's primary focus would be on the bill's fiscal
impact to the state and its residents. She relayed that the
House Health and Social Services Committee had heard the
bill several times over the past few weeks and the
committee's co-chairs would present the committee
substitute (CS). She asked members to hold questions until
the end of each segment.
REPRESENTATIVE TIFFANY ZULKOSKY, CO-CHAIR, HOUSE HEALTH and
SOCIAL SERVICES COMMITTEE, introduced the CS with a
prepared statement:
Thank you for the opportunity to present Committee
Substitute for House Bill 76, extending the COVID-19
disaster declaration.
Throughout the last year, Alaskans and our global
neighbors have faced significant health and economic
impacts as a result of the COVID-19 pandemic. And
while the virus has proved unpredictable with some
infections resulting in no or mild symptoms, other
infections developed severe illness or led to untimely
death what is constant about COVID-19 is that it is
highly contagious, grows exponentially, and new
variants pose continued public health risk to
Alaskans.
Recognizing this threat to the health and lives of
Alaskans, on March 11, 2020, the Governor issued a
declaration of a public health disaster emergency in
anticipation of the spread of COVID-19 to communities
across Alaska and issued a number of new disaster
declarations for the on-going pandemic.
We have come a long way in this last year. The global
medical community has improved clinical resources to
help those with severe infections, our society has
adapted to how we live in ways that prevent
transmission, and the record-breaking development and
deployment of vaccines offers us hope on the horizon.
But we have heard decisively from Alaska's healthcare
and community leaders that we are not out of the woods
just yet and without an ongoing disaster declaration,
this prolonged area of limbo is hamstringing response,
which continues regardless of ideology in this
building about the severity of the pandemic.
The Health and Social Services Committee heard from a
wide range of stakeholders from across Alaska, from
businesses and local government to epidemiologists and
non-profit service organizations. Testimony was clear
and consistent, Alaska still needs the tools to fight
this pandemic, keep Alaska's businesses afloat, and
help families get back on their feet. We believe this
narrow and prescriptive disaster declaration offers
that necessary set of tools.
This declaration ensures local response in vulnerable
communities with limited healthcare resources can
continue, enables Alaska to continue surveillance
testing at airports to identify cases before
widespread outbreaks occur, offers certainty and
flexibilities for frontline health providers who
remain on the pandemic's frontlines, and ensures
Alaska remains nimble in its ability to respond.
Further, the declaration provides legal flexibilities
and meets the minimum criteria by the federal
government for Alaska to receive its share of federal
funding for a number of on-going relief and recovery
efforts, including vaccine deployment, expanded
allowances for telehealth, and alternate care sites
for testing, vaccination, and treatment.
Delaying or failing to renew the declaration to best
position Alaska to fight this pandemic and keep
families safe is like taking down an umbrella in the
middle of a rainstorm because you aren't getting wet.
2:49:37 PM
REPRESENTATIVE LIZ SNYDER, CO-CHAIR, HOUSE HEALTH and
SOCIAL SERVICES COMMITTEE thanked the committee for the
opportunity to present the CS. She provided prepared
remarks:
I'd like to make it clear that CSHB 76 does not extend
the disaster, it extends the declaration so that we
can definitively end the disaster. Further, the bill
should look very familiar. In an effort to build broad
support for the declaration and move expeditiously to
meet the needs of Alaskans, CSHB 76 is modeled after
the most current version of SB 56, bringing alignment
to the Senate companion that has been considered in
both the Senate Health and Social Services and Labor
and Commerce Committees. The primary difference is
reverting to the original sunset date of September 30,
2021, which this bill allows the administration to
evaluate as needed. CSHB 76 is very pared down
compared to HB 241, which as you recall was passed in
2020. Where HB 241 was a large workshop of a wide
variety of tools, CSHB 76 is a small efficient toolbox
of essentials to finish the job. We do appreciate that
there are alternative ideas and plans to CSHB 76, so
in my sectional analysis here, I'll highlight what is
unique and why it is important.
First, this bill contains important language in that
it declares a "public health disaster emergency." If
we were to move forward without disaster language we
are willingly operating in a gray zone of uncertainty.
We would be asking healthcare providers and
organizations to run alternate care sites for
vaccinations; testing, including at airports; and
treatment without the protections a declaration
affords. Verne Berner, Alaska Native Health Board, on
March 4, in the House Health and Social Services
hearing testified to this fact. There are already
healthcare organizations encountering more red tape
and bureaucratic hurdles to set up alternate care
sites without a declaration. We heard about this from
Jared Kosin from ASHNHA also on March 4. Alaska is
risking eligibility for extended federal SNAP benefits
without this language and these extended benefits
provide $8 million per month to Alaskan families. The
Families First Coronavirus Response Act, the federal
legislation which allows for the extended SNAP
benefits states "in the event of public health
emergency declaration by the Secretary of Health and
Human Services under Section 319 of the Public Health
Service Act, based on an outbreak of Coronavirus
disease and the issuance of an emergency or disaster
declaration by a state based on an outbreak of COVID-
19, the Secretary of Agriculture" and it goes on to
explain the expanded SNAP benefits.
Without a declaration, our eligibility will expire on
April 1, we may find ourselves in a position of
forfeiting $8 million of support in April, another $8
million in May, and yet another $8 million in June for
a total of $24 million less in our economy and support
for Alaskan families. A disaster declaration gives us
the nimbleness to respond quickly if things change. We
have seen how quickly the trajectory of case rates can
increase as we also heard from Dr. Tom Hennessy on
March 4. Today, with 226 resident cases, plus an
additional 12 nonresident cases, this is our highest
count since the third week of January. Yesterday was
150 and the day before was 91.
2:53:40 PM
Representative Snyder continued to read from a prepared
statement:
The next four sections of CSHB 76 were also addressed
separately in individual Senate bills, SB 86, SB 77,
SB 78, and SB 24, with a focus on permanency in those
Senate bills. This may indeed be a good move for
Alaska, but this approach of separately legislating
key components of COVID-19 response is not efficient
and further delays response resources needed now.
Representative Snyder provided information on the four
aforementioned sections:
One, provisions for reasonable flexibility and
professional occupational licensing. Making licensure
quicker until the declaration expires, preventing the
raising of fees and waiving continuing ed
requirements. I'd like to note that SB 86, its
effective date is not until January 2022. Another
section continues expanded flexibility for telehealth
services in Alaska. Another section allows shareholder
and nonprofit meetings to be held electronically.
That's also reflected in SB 24, the previous SB 78.
Lastly, allowing certain online charitable gaming
activities, which we also see addressed in SB 77. The
remining sections of 76 included provisions for
requiring informed consent for vaccinations as amended
in Senate Health and Social Services; civil liability
protections for individuals; a financing plan as
amended in Senate Labor and Commerce, extending what
was issued by the governor on January 15, 2021; and
reporting requirements for OMB, these are reduced as
compared to HB 241.
In conclusion, Alaska has done a great job in
responding to the pandemic. We lead the nation in
vaccination rates and are the first state to open up
vaccine eligibility to anyone 16 and older. Case rates
have plateaued. These are cause for celebration but
not complacency. Individual and incomplete piecemeal
approaches with delayed start dates pared with
workaround approaches do not provide the certainty and
efficiency we need amidst an ongoing global pandemic.
I appreciate we are all emotionally fatigued by COVID-
19, but to be clear, Alaska has not been in lockdown
in months and when we had a declaration in place,
businesses were open, and people have been free to go
where they liked. Schools have opened. CSHB 76 won't
change this, instead it is a way that Alaska can
continue testing and vaccinating with efficiency and
certainty so that we can finally end the pandemic. It
is a way for healthcare providers to continue
providing needed services without unnecessary risk or
prohibitive costs and for them to adapt quickly as the
situation changes. It ensures Alaskans have access to
food and it ensures we can safely promote that Alaska
is open for business and welcome tourists who want to
help us jumpstart the economy this summer.
2:56:31 PM
Representative Zulkosky provided concluding remarks a
prepared statement:
We believe that Alaska has done an incredible job and
it is because of the hard work of many Alaskans,
especially by those in DHSS, Public Health, in Tribal
Health. What's important to us and this state is that
we have a way to continue this great work and stay on
the right path. We believe the committee substitute
for HB 76 is currently the fastest and surest way to
do this. Things are looking great, and we want to keep
it that way.
When the Legislature approved the state's first
disaster declaration in 2020, it was said that if we
look back and it feels like we did too much, the
safety precautions and interventions to protect
Alaskans from COVID-19 worked. As Foraker Group's
President Laurie Wolf eloquently said before the
Health & Social Services Committee, ending the
declaration now is akin to stopping a 7-day penicillin
prescription after three days because we're beginning
to feel better. Now is not the time to dismantle
resources that have helped to save lives, protect
businesses, and care for Alaskans over the last year.
CSHB 76 provides Alaska with the tools and resources
that our municipalities, health systems, and
businesses need to get Alaska from where we are today,
to where we need to go where Alaskans can frequent
local businesses without fear of getting sick, where
families and friends can gather in-person for life's
precious moments, and children can safely continue in-
person learning.
As anxious as we all are to return to a new normal,
inaction on this issue is consequential. Alaska has
been more successful in combating COVID-19 in part
because we have been proactive, decisive, and
responsive, and our communities, public health
professionals, and businesses have had the tools to
adapt to the world that we find ourselves in.
2:58:34 PM
Representative Rasmussen referenced an addition in Section
13 of the CS related to the personal objections to the
administration of COVID-19 vaccines. She asked whether
Legislative Legal Services had found no constitutional or
federal issues pertaining to the section. She asked if the
language applied only to state employees or to any
employees.
Representative Zulkosky believed the language had been
offered as an amendment in the Senate Health and Social
Services Committee. The intent was to provide statutory
protection for Alaskans who opt not to receive the vaccine.
Representative Rasmussen asked what type of protection the
provision provided.
Representative Zulkosky replied that the intention was to
ensure there were statutory protections that did not force
any Alaskan to receive the vaccination. She stated her
understanding that the language was not necessarily
required - there was nothing in statute requiring anyone to
receive any sort of vaccines. She reiterated that the
language had been offered on the Senate side with the
intention of making sure it was the case with the COVID-19
vaccine. She explained that the CS brought alignment
between the existing House bill with the changes that had
already been made on the Senate side.
Representative Rasmussen appreciated the language. She had
been hearing about cases where private employers in Alaska
were requiring employees to vaccinate and to show proof of
the vaccination. She thought it was a HIPAA violation. She
had been told that some businesses were requiring employees
to take personal leave or resign if they chose not to get
the vaccine by August. She had heard concerns about
airlines requiring vaccinations for people to fly. She
wanted to ensure Alaskans maintained the option to
vaccinate or not vaccinate.
3:01:35 PM
Representative LeBon referenced a provision related to
civil liability on page 10 of the legislation. He
highlighted that the language stated that "A person may not
be held liable for an action taken..." He provided a
scenario where an employee of a private sector business got
the virus. He asked if there was a liability protection for
the business. He pointed out that where the employee had
contracted the virus was not known and it could have been
somewhere outside of work or brought in by a customer or
client. He asked if there was an element of protection for
the small businesses in the bill.
Representative Zulkosky referred to the summary of changes
on the original Senate bill, where the section referenced
by Representative LeBon had been added. She communicated
her understanding that under the language a person may not
be held liable for an action that does or does not comply
with an order, proclamation, or declaration adopted by the
governor. She stated it was their understanding that the
language was a broad waiver of the liability. She remarked
that she was not an attorney and would run the question by
Legislative Legal Services for verification.
Representative Edgmon remarked that the bill was a
governor's bill. He stated that during his time on the
committee he had seen committee chairs from other
committees present personal legislation. He asked why there
was not a representative from the governor's office
presenting a governor's bill.
Representative Zulkosky deferred the question to the
administration.
Co-Chair Merrick relayed that the committee would hear from
the administration after the current presenters.
Representative Edgmon asked if the two representatives were
presenting the bill because it had most recently been in
their committee. He thought it was out of the convention of
presenting a bill. He wondered if it was an indication the
administration did not support the bill.
Co-Chair Merrick replied that the [House Health and Social
Services Committee] co-chairs had asked to present the CS.
The administration would address the bill after the co-
chairs had finished.
Representative Zulkosky replied that the assessment was
accurate. From her perspective as a co-chair of the House
Health and Social Services Committee - the topic was of
significant interest and concern to stakeholders that
routinely came before the committee - there had been a very
fast evolution of position on the issue by the
administration. She elaborated that the administration had
initially believed the legislature needed to extend the
disaster declaration and had introduced HB 76.
Subsequently, the administration had decided not to extend
the disaster declaration. The administration had then opted
to pursue a number of pieces of permanent legislation that
stood separate from a disaster declaration. She believed
the situation contributed to the awkwardness of the [House
Health and Social Services Committee] co-chairs'
willingness to present the bill. She believed it was an
indication the administration had wanted to distance itself
from the declaration. She did not want to put words in the
mouth of the administration. She communicated it had been
made clear by staff in Senator Lisa Murkowski's office that
standalone legislation that was not a disaster declaration
was not sufficient for leveraging the incoming federal
resources for COVID relief. She stated that because there
was not a statutory opportunity for a public health
emergency through Alaska statute, the co-chairs continued
to believe a disaster declaration was the best way to move
forward to ensure the state had the legal and financial
flexibilities to respond to the pandemic.
3:06:51 PM
Representative Edgmon remarked there seemed to be several
iterations by the administration. He stated that was fine
and acknowledged that things were happening quickly with
the distribution of vaccines and so on; however, the
governor had introduced HB 76 and a companion bill and had
then communicated that a disaster declaration was not
needed. Subsequently, there had been an abbreviated bill
under consideration. He highlighted that the House was now
considering the original bill. He wanted to know whether
the bill was supported or not supported by the governor,
who could ultimately veto the legislation if it was passed.
He believed the question was germane and intended to ask
the administration later in the meeting.
Vice-Chair Ortiz believed Representative Zulkosky had
stated the CS was a pared down version of the original
disaster declaration. He asked for a summary of the impact
of the CS compared to the original declaration.
3:08:43 PM
Representative Snyder answered that they could speak to
some of the elements in SB 241 that were not included in
the CS before the committee. The current bill no longer
included specific language that would have allowed the
commissioner [of DHSS] to declare health orders [on behalf
of the chief medical officer] if the chief medical officer
was unavailable. The bill no longer included the
requirement for some more detailed monthly reports to be
submitted to the Senate president and House speaker,
including detailed budgets and activities. She explained
that previously peace officers, EMTs, medical technicians,
paramedics, firefighters, and other healthcare providers
would have been presumed to have contracted COVID-19 at
work if they were exposed and tested positive. The former
bill had included some PFD ineligibility language, some
protections regarding rent, foreclosure, and utility
moratoriums. The former bill had also included rules
against price gouging and language related to financial
assistance to prevent homelessness as a result of COVID-19.
3:10:07 PM
Vice-Chair Ortiz asked about the net effect of the fact
that the bill was a pared down version.
Representative Zulkosky responded that invited testimony
would zero in on the issues. She specifically highlighted
flexibilities related to testing at airports and detailed
that Alaska had identified 3,000 cases of COVID-19 through
airports. She referenced invited testimony to be heard from
Petersburg on the impact of the virus in the community
specifically since the lapse of the disaster declaration.
She reported that the community had seen some of the
highest numbers of the virus during the period of time
without a disaster declaration in comparison with the past
year. She noted that a Dr. Hennessy would speak to some of
the issues.
Vice-Chair Ortiz relayed that he had heard that morning
from a constituent who could no longer receive telemedicine
from an endocrinologist in Seattle because the disaster
declaration had ended. He asked if passing the current CS
would eliminate the problem.
Representative Zulkosky answered, "To our understanding,
yes."
Representative Carpenter identified three issues the
committee needed to hear from the administration or another
authority. The first was the federal money at stake. He had
heard rumors it was the case but talking with the
administration he believed it was not the case. He wanted
to definitively understand the specific issue from the
administration's point of view. Second, the committee
needed to learn whether the governor wanted or needed an
emergency declaration in order to resolve the issue. Third,
he wondered whether there were other bills in the pipeline
that addressed the issues raised in the CS, which were
acceptable and solved the problem without having to declare
an emergency.
3:12:55 PM
Representative Wool asked for verification that the CS
restored mandatory airport testing for people coming into
Alaska.
Representative Snyder answered that the bill provided the
flexibility. She elaborated that under the topic of
alternate care sites, it was how testing was facilitated at
airports. Currently, the flexibility was not available
without a disaster declaration. She explained that they
[the House Health and Social Services co-chairs] had heard
from healthcare providers and health organizations that
without the protection, some of the services were
continuing, but it was a gray area.
Representative Zulkosky added that in addition to the
alternate care sites, drive-thru testing sites had been
closed throughout the state. She detailed that the action
had closed the opportunity to do surveillance and
asymptomatic testing. She explained that wider testing
provided a better snapshot of where the virus was in Alaska
and could help public health officials predict how the
virus was moving. Additionally, it gave increased
opportunity for increased genomic sequencing to know
variants and the higher virulent versions of the virus
moving throughout the state. She stated it was fundamental
in being able to identify cases early before they caused
widespread outbreaks. She noted that invited testimony
would speak to the topic.
Representative Wool restated his question.
Representative Zulkosky replied that the bill provided the
authority to the administration to be able to mandate
testing at airports.
Representative Wool remarked that there had been a
quarantine period for travelers coming into Alaska. He
thought it had been a good program. He noted it was not
currently the case. He asked if there would be any
quarantining for travelers coming to Alaska under the bill.
Representative Snyder answered that it would not be
required, but the bill would allow for the flexibility
should the need be deemed necessary.
3:15:59 PM
Representative Wool asked if the language changed from a
disaster declaration to a disaster emergency. He asked if
it was an intentional word choice.
Representative Snyder believed some of the terms were used
a little loosely and disaster declaration was used as a
sort of shorthand. She stated that the bill retained the
phrase public health disaster emergency from prior
legislation.
Representative Wool asked for verification that using the
term emergency instead of declaration had the same legal
implication.
Representative Zulkosky answered it was their
understanding.
Representative Rasmussen circled back to comments made by
Representative Carpenter. She stated that the telehealth
issue highlighted by Vice-Chair Ortiz was a major issue.
She asked if the House Health and Social Services Committee
co-chairs were pursuing long-term permanent statutory
changes that would enable Alaskans to utilize telehealth.
She believed the bill was likely the quickest avenue. She
pointed out that even a couple of weeks was a long time for
some patients to not be able to see their provider. She
supported getting it moving along quickly.
3:18:20 PM
Co-Chair Merrick relayed the committee would next hear from
the Department of Health and Social Services on behalf of
the administration.
HEIDI HEDBERG, DIRECTOR, DIVISION OF PUBLIC HEALTH,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES (via
teleconference), thanked the committee for the opportunity
to provide comment on the legislation. She read from
prepared remarks:
House Bill 76 was introduced by the governor pursuant
of Alaska Statute 26.23.020. This provides that a
disaster proclamation may not remain in effect longer
than 30 days unless extended by the legislature. On
January 15, the governor issued a declaration of a
public health disaster and emergency in response to
the COVID-19 pandemic. A bill was transmitted to the
House on January 21, proposing to extend the public
health disaster emergency to September 30, 2021. This
is the bill before you today. Absent legislative
action and pursuant to state law AS 26.23.020, the
public health disaster emergency issued on January 15,
expired on February 14th.
In the time leading up to the February 14th
expiration, we met extensively with response partners
to include our federal agencies, local governments,
healthcare providers, tribal health entities,
healthcare facilities, and associations to discuss
operations and response efforts by the state and to
determine impacts if the disaster declaration was not
extended. Based off of the feedback, the
administration evaluated the current COVID response
plan, which includes elements which you are all very
familiar with, I am sure. They include widespread
testing, supporting non-congregate housing for certain
groups of individuals who need to quarantine or
isolate, providing alternate care sites, procurement
of personal protective equipment and testing supplies,
guidelines for Alaskans and nonresidents traveling to
and through Alaska, contact tracing, guidelines for
critical infrastructure workforce and employers, and
vaccine elocution, distribution, and administration.
To continue to keep Alaska one of the safest states,
we're requesting limited authorities as we maintain
the robust testing, contact tracing, vaccine
administration and distribution, and response to
community outbreaks. As part of our evaluative
process, we looked closely at the authorities that are
available to the governor under the Alaska disaster
declaration acts. I would like to review the
authorities under the Alaska disaster acts with you so
that we can walk through what it offers and how we
used them and what we need. AS 26.23.020(b) states
"the governor may issue orders, proclamations, and
regulations necessary to carry out the purpose of the
disaster acts." This was used to allow state agencies
to be nimble and flexible in response to the public
health emergency and disaster. It also provided
protections to help mitigate the spread of COVID-19 by
establishing guidelines for travel into Alaska, around
Alaska, and for our critical infrastructure workforce.
The AS 26.23.020(e) is a proclamation of a disaster
emergency activates the disaster response and recovery
aspects of state, local, and interjurisdictional
disaster emergency plans. This authority was used to
allow the unified command structure, which is the
Department of Public Safety, the Department of
Military and Veterans Affairs, and the Department of
Health and Social Services to support local
jurisdictions, the healthcare system, and coordinate
the statewide response to the pandemic.
3:23:27 PM
Ms. Hedberg continued to read from prepared remarks:
It also allowed the establishment of the alternate
care sites, including the outpatient therapeutic
treatment centers and establishing the vaccine point
of dispensing clinics, and allowed for the state to
coordinate the logistics of supplies and materials. AS
26.23.020(f) the governor may delegate or assign
command authority for the National Guard by
appropriate orders or regulations. This allowed us to
utilize the National Guard for response purposes, such
as contact tracing and logistical support at our
warehouse.
AS 26.23.020(g) and there are many authorities under
this statute, a number of which we used in this
response. I'll go over the ones we used and the ones
we did not use. Number one was the suspension of
provision of regulations or statutes if compliance
would prevent or substantially impede or delay action
necessary to cope with a disaster emergency. We used
this statute for emergency procurement of supplies for
hospitals, clinics, and communities, and emergency
procurement for contracts for cold chain shippers and
testing and supplies. We also hired temporary
personnel to support public health response plans and
those were contract tracers, public health nursing,
microbiologists, and support for our data systems.
This statute also allowed for the increased
flexibility in how we care for and provide services to
our most vulnerable populations in congregate settings
and facilities.
Number three is the transfer of personnel or alter the
function of state departments and agencies or units of
them for the purpose of performing or facilitating the
performance of disaster emergency services. We
basically used this statute and repurposed the entire
Division of Public Health to respond to COVID-19.
Number seven is control ingress to and egress from a
disaster area. The movements of personnel within the
area and occupancy of premises. This is the authority
that we used to implement the pre-travel testing
requirements for travel into Alaska and to communities
off of the road system and the Marine Highway System.
3:26:17 PM
Ms. Hedberg continued with her prepared remarks:
Number nine, which makes provisions for the
availability of and use of temporary emergency
housing. This was used for non-congregate housing for
homeless and for travelers that arrived in Alaska with
a positive test result. Number ten, which is allocate
or redistribute food, water, fuel, clothing, medicine,
or supplies. This is the authority that is used for
allocation and distribution of our personal protective
equipment, testing supplies, vaccine, and therapeutic
treatments.
Now for the other authorities that are in section (g)
that we did not use. There are four areas that are
good to highlight for your awareness. The first is, we
did not use the available resources of the state
government and of each political subdivision of the
state as responsibly necessary. We did not commandeer
or utilize any private property, we did not suspend or
limit the sale, dispensing, or transportation of
alcoholic beverages, explosives, or combustibles. We
did not use money from the oil and hazardous substance
relief response accounts to respond to a disaster
related to an oil or hazardous substance discharge.
In summary, not every single authority available under
the Alaska Disaster Act was used or needed for the
COVID pandemic response. Authorities that were used,
were not used necessarily at the same time. They were
some authorities that we used early on in the
response, but not later and there were authorities
that we used later but not earlier. There were a
number of authorities that we've used consistently
throughout the response. As we've evaluated this
process, we've realized that we do not need broad
authorities available under the Alaska Disaster Act to
continue the COVID response and transition into
recovery. The Department of Health and Social Services
believes that there's room to utilize a more limited
or targeted approach by using uncodified law to
establish specific authorities that we do need that
are important for our response and recovery plan and
for a limited period of time.
3:29:09 PM
Ms. Hedberg continued with prepared remarks:
Here are the authorities that we have identified, and
again, this is based off of feedback and as one of the
incident commanders I can tell you that this is truly
the authorities that we need to continue to respond
effectively to this response and transition into
recovery.
The first is to allow the Department of Health and
Social Services to continue to coordinate, allocate,
distribute, and manage the State of Alaska vaccine and
therapeutics for the COVID-19 response. These are
still scarce resources.
The second is to allow the Department of Health and
Social Services to cooperate with the federal
government with respect to the blanket waivers, the
1135 waiver, and appendix K authorities, and the
application and distribution of SNAP emergency
allotment (also known as EA benefits) as part of the
state's response to COVID-19.
Third is to allow the Department of Military and
Veterans Affairs to support and assist the Department
of Health and Social Services.
Fourth, is to allow the Department of Military and
Veterans Affairs to receive delegation of authority
from the governor, allowing activation of the Alaska
National Guard to assist with segments of the state's
response and recovery plan.
Fifth is allowing the Department of Military and
Veterans Affairs to coordinate with FEMA to maintain
the funding for non-congregate sheltering capabilities
for local jurisdictions across the states.
Sixth is to provide the authority for the use of
telehealth and telemedicine for healthcare providers
currently licensed in good standing in another state.
Finally, to provide immunity from liability for a
governmental entity, employee, or person who's engaged
in performing duties as part of the state's response
to COVID-19.
We understand the sensitivity of using the disaster
declaration and a public health emergency to provide
such a broad authority. We also understand the need to
progress as we are in this response and starting to
pivot into recovery for Alaska. We need to have the
tools if we need to respond. As you will hear there
are some communities that do have outbreaks, but we do
have other communities that are moving into recovery,
which is why we want to make sure we have the
necessary limited tools and that we can use those
necessary limited tools if it's going in the wrong
direction.
3:32:01 PM
Ms. Hedberg finished her provided remarks:
It is possible to allow the appropriate authorities to
the Department of Health and Social Services and the
Department of Military and Veterans Affairs to
continue the state's response plan without providing
the broad authority of a public health emergency
disaster declaration under the Alaska Disaster
Declaration Act. We respectfully request the House
Finance Committee consider providing identified
limited authorities to continue Alaska's response and
recovery plan without the issuance of an extension of
a disaster declaration.
Ms. Hedberg thanked the co-chairs. She listed several other
staff available to help answer questions.
3:33:06 PM
Representative Wool noted that testing at the airport was
currently voluntary. He cited new COVID variants coming
from different parts of the country and world. He asked
where the administration stood on mandatory testing for
travelers coming to Alaska.
Ms. Hedberg replied that she had helped stand up the
testing at Alaska's ten airports receiving flights from the
Lower 48. She reported that it was a very good strategy.
She relayed that the sites had identified close to 3,000
cases through the testing option [at airports]. She
clarified there were many more options available. The
department continued to say that testing was an important
tool. The department recognized that many individuals had
recovered from COVID and within a certain time period those
individuals did not need to test. Additionally, individuals
who were fully vaccinated (meaning two weeks after their
last dose) did not need to be tested. She stated it was up
to the legislature to decide whether to include the
provision [related to airport testing] in the legislation.
She mentioned that when the disaster declaration expired on
February 14, all of the infrastructure had remained in
place. She elaborated that the health orders had changed to
advisories, and it was currently optional. She highlighted
how giving the option and educating travelers and Alaskans
played a role in early detection.
3:35:47 PM
Representative Wool stated his understanding of the answer.
He postulated that the testing of incoming travelers was
one of the reasons Alaska had decent COVID results. He
highlighted that other island or quasi-island communities
such as Hawaii, New Zealand, and Alaska that were able to
isolate people coming in had done pretty well. He remarked
that Alaska was currently only accessible by air and
possibly cruise ship in the coming summer. He knew people
who had flown in since the testing requirement was lifted
and very few people opt to get the test at the airport. He
was concerned about the issue. He speculated that new
variants coming in from out of state could be the source of
a future uptick. He thought the airport testing was a good
program to look into continuing for a period of time.
3:37:50 PM
Representative LeBon believed Ms. Hedberg had talked about
protecting state workers from liability from any COVID-
related incident or illness. He asked if it overlapped to
protect any private sector business that was operating
under the label of an essential business to protect the
business from claims that may originate from clients,
employees, or other individuals who frequent the business.
Ms. Hedberg deferred the question to the Department of Law.
SUSAN POLLARD, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF
LAW (via teleconference), asked for clarification on the
question. She understood the question to be about Section
12 of the bill and how it would potentially affect civil
liability for private employers.
Representative LeBon complied. He stated his impression
that Section 12 was primarily aimed at protecting the
state, departments, and employees. He asked if the
declaration included any private sector employer
protections.
Ms. Pollard stated that her understanding of Section 12 was
that it had been added in the other body to SB 56 and the
bill would have had an effective date of February 14. She
stated that if the bill had been effective on that date,
there would need to be a retrospectivity indication for
people who acted either in compliance with the health order
mandates or not because the disaster order had extended.
She did not believe the detail related to the private
sector had really been contemplated. She could not give a
clear and firm answer at present.
3:41:08 PM
Representative LeBon remarked on the apparent absence of
any protections for private sector employers who may
receive any claims from clients, employees, or others, when
trying to provide an essential service.
Vice-Chair Ortiz thanked Ms. Hedberg for her testimony. He
appreciated hearing a list of the things DHSS and the
administration needed going forward to control COVID. He
asked if the administration supported the bill because it
met the needs identified by the administration going
forward.
Ms. Hedberg answered that the administration believed a
public health emergency or disaster declaration was not
needed to continue on. The administration believed limited
authorities were needed. She confirmed that the bill, as
currently written, provided what the administration needed.
Vice-Chair Ortiz asked for clarification. He asked for
verification that the bill provided what the administration
needed, but the administration did not support it.
Ms. Hedberg answered that all of the authorities the
administration needed were included in the bill; however,
the bill contained some authorities that were not needed.
She elaborated that the state was a year into the response,
and it had built up many capabilities and worked
collaboratively with communities. The administration was
asking for a limited list of authorities that it believed
could be created in a separate bill in uncodified law.
3:43:56 PM
HB 76 was HEARD and HELD in committee for further
consideration.
Co-Chair Merrick stated the meeting was over time and would
adjourn.
ADJOURNMENT
3:44:09 PM
The meeting was adjourned at 3:44 p.m.