02/26/2015 03:00 PM House HEALTH & SOCIAL SERVICES
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| Start | |
| Presentation: Department of Health and Social Services Division of Public Assistance | |
| HB59 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 59 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
February 26, 2015
3:02 p.m.
MEMBERS PRESENT
Representative Paul Seaton, Chair
Representative Liz Vazquez, Vice Chair
Representative David Talerico
Representative Neal Foster
Representative Louise Stutes
Representative Adam Wool
Representative Geran Tarr
MEMBERS ABSENT
COMMITTEE CALENDAR
PRESENTATION: DEPARTMENT OF HEALTH AND SOCIAL SERVICES DIVISION
OF PUBLIC ASSISTANCE
- HEARD
HOUSE BILL NO. 59
"An Act relating to marijuana concentrates; and providing for an
effective date."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 59
SHORT TITLE: MARIJUANA CONCENTRATES; LICENSES
SPONSOR(s): REPRESENTATIVE(s) SEATON
01/21/15 (H) PREFILE RELEASED 1/16/15
01/21/15 (H) READ THE FIRST TIME - REFERRALS
01/21/15 (H) HSS, JUD
02/03/15 (H) HSS AT 3:00 PM CAPITOL 106
02/03/15 (H) Heard & Held
02/03/15 (H) MINUTE(HSS)
02/26/15 (H) HSS AT 3:00 PM CAPITOL 106
WITNESS REGISTER
RON KREHER, Acting Director
Director's Office
Division of Public Assistance
Department of Health and Social Services (DHSS)
Juneau, Alaska
POSITION STATEMENT: Presented an overview of the Division of
Public Assistance.
SHAWNDA O'BRIEN, Administrative Operations Manager
Director's Office
Division of Public Assistance
Department of Health and Social Services
Juneau, Alaska
POSITION STATEMENT: Answered questions during the presentation
by the Division of Public Assistance.
MARCEY BISH, Program Manager
Child Care Program Office
Division of Public Assistance
Department of Health and Social Services
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the presentation
by the Division of Public Assistance.
ELAINE RICH, Chief
Program Integrity & Analysis
Division of Public Assistance
Department of Health and Social Services
Juneau, Alaska
POSITION STATEMENT: Answered questions during the presentation
by the Division of Public Assistance.
TANEEKA HANSEN, Staff
Representative Paul Seaton
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented the changes to HB 59 for the
sponsor of the bill, Representative Seaton.
TIM HINTERBERGER, Ph.D., Chair
Campaign to Regulate Marijuana Like Alcohol in Alaska
Anchorage, Alaska
POSITION STATEMENT: Testified via teleconference in opposition
to HB 59.
RACHELLE YEUNG, Legislative Analyst
Marijuana Policy Project
Washington, D.C.
POSITION STATEMENT: Testified via teleconference in opposition
to HB 59.
ALLISON KULAS, Program Manager
Tobacco Prevention and Control
Division of Public Health
Department of Health and Social Services
Juneau, Alaska
POSITION STATEMENT: Testified during the discussion of HB 59.
CYNTHIA FRANKLIN, Director
Alcoholic Beverage Control (ABC) Board
Anchorage, Alaska
POSITION STATEMENT: Testified during the discussion of HB 59.
ACTION NARRATIVE
3:03:16 PM
CHAIR SEATON called the House Health and Social Services
Standing Committee meeting to order at 3:02 p.m.
Representatives Seaton, Talerico, Stutes, Tarr, and Wool were
present at the call to order. Representatives Vazquez and
Foster arrived as the meeting was in progress.
^PRESENTATION: DEPARTMENT OF HEALTH AND SOCIAL SERVICES DIVISION
OF PUBLIC ASSISTANCE
PRESENTATION: DEPARTMENT OF HEALTH AND SOCIAL SERVICES DIVISION
OF PUBLIC ASSISTANCE
3:03:41 PM
CHAIR SEATON announced that the first order of business would be
a presentation by the Department of Health and Social Services,
Division of Public Assistance.
3:04:02 PM
RON KREHER, Acting Director, Director's Office, Division of
Public Assistance, Department of Health and Social Services
(DHSS), provided a PowerPoint overview of the programs, budget,
core services, and service population titled "FY2016 Division
Overview." He stated that he would also discuss poverty in
Alaska and the role of the division and its services. He
commented that the current budget deficit with its corresponding
environment were "a big test of state priorities, and certainly
the funding that goes with those priorities." He mentioned HB
30 which asked for priorities to services and programs while
requesting a cut to some of these, as well as the proposed
budget by the governor. He noted that the Alaska State
Legislature was also interested in the projected reduction of
general fund spending. He asked that the committee ponder the
question of identifying Alaska's most vulnerable citizens, and
what standards should be used to prioritize safety net services.
He declared the importance of ways that the department, the
division, and the legislature could ensure that the
constitutional mandate for the welfare of Alaskans was met. He
directed attention to an eight page overview of the division
programs, as well as the Women, Infants, and Children (WIC)
program and the child care program [Included in members'
packets]. He declared that these two programs could make a
difference for Alaskans.
3:07:36 PM
MR. KREHER reviewed the "Division Organization Chart", slide 2,
which showed the distribution of the 589 staff, including the 23
positions requested to support Medicaid Expansion. He reported
that 75 percent of the workforce was dedicated to eligibility
determinations and benefit issuance throughout the 18 statewide
field offices. He stated that there were also grantees and
contractors providing support for families primarily through
work services, WIC, and child care. He shared that the mission
of the division, slide 3, "Division Overview," was to promote
self-sufficiency and safety net benefits for families, as well
as administrative management for prudent stewardship of the
state's resources through the program integrity and quality
assurance sections. He noted that more than 155,000 Alaskans
were served by the Division of Public Assistance in November,
2014, which he declared to be a normal service population size,
as it included child care, food stamps, and adult public
assistance. He said that, although it could be surprising to
consider that so many Alaskans were low income, in poverty, and
met the criteria for the programs, Alaska was "in the middle of
pack nationally," as the national average was about 18 percent
and Alaska was at the 20 percent level.
3:10:02 PM
REPRESENTATIVE TARR asked whether a recipient of more than one
program was counted once or twice.
MR. KREHER replied that this was the total number of recipients,
not duplicated.
REPRESENTATIVE TARR asked if that also included the children.
MR. KREHER replied that this included everyone, adults and
children.
3:10:40 PM
CHAIR SEATON asked how many personnel were related to Medicaid
Expansion.
MR. KREHER replied that there were 23 people, primarily
eligibility technicians, as well as some policy and research
analysts.
3:11:05 PM
REPRESENTATIVE WOOL asked if the hirings were in anticipation of
Medicaid Expansion.
MR. KREHER replied that the department anticipated that Medicaid
Expansion would occur in July, and this would include those
individuals in "the gap group."
REPRESENTATIVE WOOL asked if these were recent hires.
MR. KREHER clarified that these positions had not yet been
hired, but would start after the beginning of the new fiscal
year.
3:12:10 PM
MR. KREHER returned attention to the percentage of the
population receiving aid and said that low income Alaskans were
the first people to be effected in an economic downturn, and
they were the last ones to recover. He reflected on the
recession which began in 2008, and pointed out that this
effected a lot of low income families in Alaska. He stated that
this could lead to an increased demand for the division's
services.
3:13:22 PM
MR. KREHER moved to slide 4, a graph titled "DPA Caseload
History FY2007-2014," and reviewed the growth in recent years of
the seven largest programs in the division. He pointed out the
parallel growth between the Medicaid population and the food
stamp caseloads over the last few years.
3:13:54 PM
MR. KREHER addressed slide 5, a program graph, "DPA Benefit
History FY2007-20014," that indicated the drops and peaks of
services related to seasonal needs, such as heating assistance,
which had received a lot of supplemental funding from the Alaska
Affordable Heating program. He pointed out that the big dips in
the food stamp program (SNAP) reflected the months that
recipients received the permanent dividend fund, and the
issuance of cash benefits to replace the loss of federal funds.
3:14:38 PM
MR. KREHER, in response to Representative Vazquez, helped to
establish the order of the graph lines.
3:16:01 PM
MR. KREHER, slide 6, used a state map of census districts to
indicate where public assistance was distributed by percentage
of population. He noted that the rings reflected the
unemployment rates in those same areas, and he acknowledged that
there was a connection between areas of low employment and
reliance on public assistance, even in the urban areas.
3:17:01 PM
MR. KREHER directed attention to slide 7, "DPA Service
Population," which listed the priorities under the results based
accountability model. He said that the Division of Public
Assistance touched individuals in every stage of life, and
protected and promoted the health of Alaskans by making
eligibility determinations for Medicaid, noting the life cycle
chart at the bottom of the slide. The WIC program addressed
nutritional needs for pregnant women and young children who were
at nutritional risk, Medicaid provided health care access and
delivery, and Alaska families were assured of their basic needs
and supports to keep the family together. He reported that the
adult public assistance program ensured that seniors and
individuals with disabilities were able to live as independently
as possible in their communities. He declared that personal
responsibility was a key aspect of many public assistance
programs, noting that the temporary assistance program had major
work requirements. He opined that the chart provided
percentages for services and ages served, from pre-natal to
death. It also indicated that almost 60 percent of the service
population were children under the age of 18 or seniors over the
age of 65.
3:19:30 PM
MR. KREHER addressed slide 8, "Individual Recipients - November
2014," which reflected that many Alaskans received multiple
benefits from multiple programs. He pointed out that 36 percent
[55,194 people] of the total service population of about 155,000
people, only received Medicaid; whereas, food stamps "touches
many, many more Alaskans." The nature of the earnings for the
working poor changed dramatically in the last few years, and it
was now estimated that [indisc.] million Americans had incomes
below 200 percent of the federal poverty rate. He stated that
the vast majority of these people were working. Overall, in
Alaska, 26 percent of people who receive food stamps had earned
income, and were working while living at a poverty level.
MR. KREHER said that slide 9, "Race, All Programs - November
2014," provided additional demographic information, reporting
that 40 percent of the division's service population was White,
while 39 percent was Alaska Native.
3:21:21 PM
REPRESENTATIVE TARR returned to slide 8, and asked about the
income guidelines for eligibility to food stamps and Medicaid.
She opined that everyone who qualified for food stamps should be
qualified for Medicaid.
MR. KREHER explained that the food stamp program income limits
were lower than the income limits for most Medicaid programs.
The reality was that the majority of those who only qualified
for food stamps would not, until Medicaid Expansion, qualify for
Medicaid. He noted that other individuals opted to only apply
for services and programs that they felt "they truly need."
REPRESENTATIVE TARR mused that these people were eligible, but
did not apply.
MR. KREHER acknowledged "there may be some folks who are, in
fact, eligible for Medicaid and haven't applied."
3:22:50 PM
MR. KREHER addressed slide 10, and reiterated that the high
percentages of children, when combined with adults, was the
majority of the service population. He declared that it was
important to note that many of those in the adult category had
disabilities and were also receiving adult public assistance.
3:23:32 PM
MR. KREHER spoke about slide 11, "Public Assistance Core
Services," and shared that the core services in the division
were narrowly defined, as a "big chunk of it is actually doing
the eligibility determination." He reported that 75 percent of
the workforce were office assistants, eligibility technicians,
and supervisory staff who were handling the intake, doing the
renewal applications, and ensuring that benefits were
distributed in a timely manner. He reported that the slide
depicted the average monthly recipients, and noted that some of
the services were seasonal.
CHAIR SEATON asked if those not listed as annual were monthly
averages.
MR. KREHER stated his agreement. He moved on to slide 12,
"Public Assistance Core Services," which listed the annual
expenditures for these same programs. He pointed out that the
SNAP program (food stamps) was not included as the division only
handled its administration, and not the funding.
REPRESENTATIVE STUTES asked for clarification on slide 11, which
listed 4,706 children receiving child care assistance.
MR. KREHER explained that this was the number of children who
were authorized for the benefit.
REPRESENTATIVE STUTES asked about slide 12, which listed a
childcare cost of $1.7 million per month.
MR. KREHER replied that this was correct, that childcare was an
extraordinarily expensive option for parents. He relayed that
the cost of housing for low income families was enormous, and
that child care for multiple children could be even more. He
said that eligibility determination and distribution of the
benefits was the second part of the division's core service.
3:27:30 PM
REPRESENTATIVE STUTES relayed that the childcare cost was $369
per month per child.
CHAIR SEATON stated that $369 per month was "quite a deal."
3:28:13 PM
MR. KREHER declared that there were three child care programs,
PASS (Parents Achieving Self Sufficiency) programs, which
included one for people on welfare, the Alaska Temporary
Assistance program; one for people in transition from welfare;
and the third was for people off welfare, working, or in
education related to employment. He said that the subsidies
increased as a person advanced through the programs.
3:28:52 PM
MR. KREHER moved on to slide 13, "Public Assistance Core
Services," which listed the monitor beneficiary and provider
compliance, the areas that ensured that Alaskans receiving the
benefits, as well as the vendors, were being as responsible as
possible. He stated that there had been a lot of outreach to
educate the public about high quality. He shared that the
quality assurance group met federal reporting requirements, and
another group reviewed and monitored vendor compliance. He
declared that all the groups were related to ensuring the most
effective stewardship of the state's resources, stating that the
fraud team was "a crack unit" and had recovered almost $8
million in the past year.
3:30:15 PM
MR. KREHER spoke about the individual and family support
services, which worked in concert with child care to provide
basic services for families, as a safety net to help keep their
homes and supplement their food. He said that all of these
programs can have a positive impact by assisting with job search
and work activities, employment and self-sufficiency planning,
supportive services, skills development, job training, and
families first and self-sufficiency activities. He expounded on
the WIC program and the impact on people without adequate
nutrition. He declared the importance for adequate and proper
nutrition for children, noting that research tied poor nutrition
to "all sorts of behavioral challenges." He relayed that the
work services programs had work requirements intended to help
people get off the assistance roles. He acknowledged that there
were a significant number of people with special needs who
cannot achieve self-sufficiency in the expected two year period.
3:32:48 PM
MR. KREHER reviewed the WIC program, slide 15, and lauded the
national award winning breastfeeding promotion and support
program, as well as the health and nutrition education program.
He directed attention to the additional committee information
[Included in members' packets].
3:33:27 PM
MR. KREHER offered a brief budget overview, slide 16, "DPA
Budget Overview," declaring that this did not include the SNAP
benefits. He pointed out that the division budget was just
under 12 percent of the department budget, and that the vast
amount of the money, 76 percent of the funding, was paid to the
clients or the vendors serving the clients in the communities.
He added that about $15 million each month were paid in SNAP
benefits in Alaska. He reported that the administrative costs,
which included the personal services to the employees, was about
24 percent of the budget. He addressed slides 17 and 18,
"Division Overall Funding Detail," and stated that a lot of this
expenditure was from the general fund and went to the clients
and vendors.
3:34:49 PM
REPRESENTATIVE VAZQUEZ asked about the "other" category that
showed 5 percent.
MR. KREHER deferred.
3:35:14 PM
MR. KREHER addressed slide 19, "Breakdown of General Funds,"
which depicted the funds by program. The general fund breakout
was used to identify areas for efficiencies as requested by the
governor, which resulted in a $12 million total reduction, slide
20. He listed the cuts identified for programs, which included:
the Alaska Temporary Assistance Program, the Adult Public
Assistance Program, the Tribal Assistance Programs, and the
Energy Assistance Program because there were lapsed balances in
each of these, and there were some declining caseloads. He
offered his belief that, although this could work, the big risk
was if the economy did not get moving, as the people on the
margins would begin to feel even more pressure. At that point,
he asked, would there be the funds necessary to provide benefits
for a growing caseload in the future. He stated that the only
program with a programmatic impact was the proposed reduction to
the senior benefits program. This program had been under review
for termination and the senior population was likely to climb.
He suggested that the big driver in cost in the next 5 - 8 years
for this program would be from the families that receive the
highest payment, $250 each month, as that segment of the
population would most likely grow. He reported that this
included several thousand people who did not receive any other
benefits from the state. He said that this would result in a 20
percent reduction to benefits.
3:39:08 PM
REPRESENTATIVE TARR asked if the income limits were also being
adjusted.
MR. KREHER responded that the federal poverty limits were
adjusted annually, although the change in the senior benefit
levels would not happen until 2016.
REPRESENTATIVE TARR asked for clarification that this was for FY
2016, effective July 1, 2015.
3:40:02 PM
MR. KREHER reviewed the division's successes, slide 21, "Recent
Successes," which included a federal bonus award for
administration of the food stamp program. Although this money
had to be reinvested in the SNAP program, there was a 50/50
match for it, and this $900,000 bonus would then be worth $1.8
million if it was used in the SNAP program. He reported that a
plan for use of the money would be submitted in the upcoming
week. He spoke about the development of a quality improvement
system for childcare, which was an organized way of assessing,
improving, and communicating the quality of early child care and
learning programs for families. He pointed out that Alaska was
one of the few states that did not have a full Quality
Recognition & Improvement System (QRIS), so the state partnered
with thread, which was the state's resource referral agency. He
said that this effort would be amplified as the childcare
development fund block grant had been renewed, but this required
a lot of work, some of which was not funded by the federal
government. He mentioned the almost $8 million in cost
avoidance fraud claims and direct savings for program
disqualifications. He said that the IT system had come on line
just as planned, and it was working well with the benefits and
tracking of WIC recipients. He shared that the division was
piloting Hospital Presumptive Eligibility, a condition of the
Patient Protection and Affordable Care Act, which allowed
hospitals to presume someone to be eligible for Medicaid within
a very short period of time. He explained that this was
designed for point of access for care to allow for quick
enrollment in Medicaid, an idea pushed by the hospitals.
3:43:58 PM
MR. KREHER referenced slide 23, "Current Challenges," which
included an enormous backlog of applications, partially driven
by the overlapping of the two systems as the new one was brought
on-line. He allowed that progress was being made toward
elimination of the backlog, and that a lot of overtime had
occurred to alieve the desperate situation. He said that 10
percent of the workforce had volunteered to assist field staff,
and that he was even dealing with returned mail and registering
applications. He stated that the goal was to eradicate the
backlog before Medicaid Expansion went live. He shared that
another challenge was to leverage technology, as there was a
desperate need for electronic document management in every
division in the department. He stated that the business process
improvements had been effective, providing a means to stay ahead
of the volume of work when the food stamp caseload almost
doubled from 2008 - 2010. He pointed out that the
aforementioned technical challenges for the new system, as well
as complex Medicaid policies, overwhelmed the division's work
process. He reported that the division had applied to use some
of the federal bonus funds to invest in a contractor to help re-
engineer the business process, and to find more efficiencies, as
there was no automated way to manage the flow of the workload.
3:46:58 PM
MR. KREHER concluded the PowerPoint presentation with slide 24,
"Moving Forward." He expressed concern with the increase to
caseloads if the economy remained at an ebb, as it did not take
much to affect the population that the division worked with for
assistance. The division was looking at long range programmatic
impacts of minimum wage increases, although he surmised that
there would not be much impact in the first year. He stated
that the best way to address poverty was with a good living
wage. He stated that the division was actively pursuing
partnership work with the Office of Children's Services and the
Division of Public Health. He spoke about the Workforce
Innovations and Opportunity Act and the Alaska Temporary
Assistance Program, and future work with the Department of Labor
& Workforce Development to help re-build the job center
networks. He reported that the tribal health organizations were
also very important partners, noting that there were seven
tribal assistance programs which were an avenue of access for
their clients. He lauded the child care program and the WIC
nutrition education program.
3:49:35 PM
SHAWNDA O'BRIEN, Administrative Operations Manager, Director's
Office, Division of Public Assistance, Department of Health and
Social Services, in response to Representative Vazquez,
explained that the "other" category on slide 18 included
administrative costs associated through doing business with
other agencies, reimbursable services agreements (RSAs),
interagencies, and leasing costs.
3:50:35 PM
MR. KREHER pointed out that the division had RSA's with many
other state agencies.
3:50:55 PM
REPRESENTATIVE STUTES directed attention to slide 2, and
compared the division organization chart with the graph on slide
6 for the DPA recipients as a percentage of census area
populations. She asked if there was any relationship between
the number of people working in certain areas with the number of
clients served.
MR. KREHER replied that, in actuality, the caseload was
universal, explaining that the staff in Bethel were not just
serving the population in the Yukon Kuskokwim Delta area.
REPRESENTATIVE STUTES asked if, although she lived in Kodiak,
someone in Bethel could be handling the claim.
MR. KREHER expressed his agreement, as the goal was to provide
the timeliest service for individuals.
3:53:20 PM
REPRESENTATIVE VAZQUEZ referenced slide 22, and noted that
historically an individual could have retroactive eligibility
for Medicaid. She asked how that was different from presumptive
eligibility.
MR. KREHER explained that it was necessary to submit a fully
filled out application to the Division of Public Assistance in
order to receive Medicaid, under normal circumstances. Under
federal law, the division had 45 days to determine Medicaid
eligibility, although, he shared, the division goal was to do
this in less than 30 days. If there were any medical costs in
the three months prior to the month of application, then retro
Medicaid would be awarded. The concept behind presumptive
eligibility was to ensure that hospitals received payment for
Medicaid covered services from the day the patient entered. The
primary difference was the pace with which eligibility can be
determined, as there was only one day to make the eligibility
determination from the hospital's checklist.
3:55:35 PM
REPRESENTATIVE VAZQUEZ asked about the recourse if there was an
error.
MR. KREHER explained that criteria had been established with the
hospitals, and if more than a certain percentage of presumptive
eligibility errors occurred, there was a corrective compliance
procedure.
REPRESENTATIVE VAZQUEZ asked when the compliance rate was
determined.
MR. KREHER relayed that, as this was a new program, those
details were still being worked out, and he offered to provide
further information.
3:56:58 PM
REPRESENTATIVE VAZQUEZ directed attention to slide 23, and asked
if the block grants referenced were state or federal grants, and
how much were they.
MR. KREHER replied that this was a federal grant, and he
deferred for the amount.
3:57:42 PM
MARCEY BISH, Program Manager, Child Care Program Office,
Division of Public Assistance, Department of Health and Social
Services, in response to a question by Representative Vazquez,
said that the division did not currently have the funding
formula from the reauthorization, and in response to Mr. Kreher,
she estimated that the Child Care and Development Block grant
was $13 million during the past year, offering to research the
exact amount.
3:58:30 PM
REPRESENTATIVE VAZQUEZ asked about the number of referrals to
the fraud control unit, how many cases were referred for
prosecution, and the average amount of restitution.
MR. KREHER offered to provide further information, pointing out
that this information was also available on the division
website.
3:59:36 PM
ELAINE RICH, Chief, Program Integrity & Analysis, Division of
Public Assistance, Department of Health and Social Services, in
response to a question from Representative Vazquez regarding the
number of fraud referrals, explained that there several
categories, and that of the 572 applicant referrals, 227 were
found to be fraudulent. There were 549 investigations for
individuals currently receiving public assistance, and of these,
158 were found to be fraudulent. During the Fiscal Year 2014,
there were 17 convictions with court ordered restitution in the
amount of $429,776.
REPRESENTATIVE VAZQUEZ asked about the number of referrals to
the Medicaid fraud control unit and the amount recouped.
MS. RICH offered to provide further information.
4:01:06 PM
REPRESENTATIVE VAZQUEZ asked whether the Surveillance
Utilization Review Software was being used.
MR. KREHER replied that he did not know.
REPRESENTATIVE VAZQUEZ asked about the relationship between the
division and the Medicaid payment processors.
MR. KREHER explained that the Division of Public Assistance was
responsible for the eligibility determinations, and once that
information was in the system, the benefits were issued.
REPRESENTATIVE VAZQUEZ asked if the Department of Administration
(DOA) processed the payments for SNAP.
MR. KREHER replied that these benefits were not processed by the
DOA, but went through the food and nutrition services and JP
Morgan, the banking institute for electronic benefit transfers.
4:02:59 PM
CHAIR SEATON directed attention to a handout titled "Senior
Benefits Program." [Included in members' packets]
MR. KREHER explained that this provided a basic overview of the
senior benefits program, and in response to Chair Seaton, said
that it was not on the division website. He explained that it
was available to any Alaskan over the age of 65 who had income
falling into one of the three income brackets. He explained
that it required an income below 75 percent of the federal
poverty limit for benefits of the highest payment amount;
individuals between 75 and 100 percent of the federal poverty
limit received the middle benefit; and individuals with income
above 175 percent of the federal poverty level received the
lowest payment. He noted that an individual would receive $250
per month if their income was less than $920 per month.
CHAIR SEATON asked about the other two payments, which were
facing a proposed cut of 20 percent. He stated that an
individual with an income of $1,200 per month would receive
about $140 per month, and an individual with income of $2,146
per month would receive about $100 month. He clarified that
this was an income based program prior to the deduction of any
taxes or expenses. He asked if there was any asset
qualification for determination.
MR. KREHER replied "there is no asset test."
CHAIR SEATON opined that a person could have significant assets
and wealth with very little income.
4:06:42 PM
REPRESENTATIVE WOOL asked if the backlog indicated on slide 23
was attributable to any one cause.
MR. KREHER responded that this was a "perfect storm" due to a
series of contributing events, one of which was the reality that
there was not funding to start up a new Medicaid eligibility
system until October, 2012. Under the Patient Protection and
Affordable Care Act, in order to maximize federal match
participation, there was a requirement for functionality of
certain aspects of the system by October, 2013, and that this
had not started in Alaska until May or June, 2013. He
acknowledged that it was understood that it would create a drain
on the staff resources and a fair number of employees had to
contribute time to the project design and development as they
were subject matter experts. He noted that during the weeks of
design sessions, their work was handled by others and when the
system did not go live, a contingency manual system had to be
utilized and Medicaid determinations began to slow. He pointed
out that account transfers were pushed from the federally
facilitated market place, and created a lot of extra work.
CHAIR SEATON thanked the presenters and asked the committee to
submit further questions.
4:11:28 PM
The committee took a brief at-ease.
4:11:35 PM
HB 59-MARIJUANA CONCENTRATES; LICENSES
CHAIR SEATON announced that the next order of business would be
HOUSE BILL NO. 59, "An Act relating to marijuana concentrates;
and providing for an effective date."
4:17:51 PM
REPRESENTATIVE VAZQUEZ moved to adopt the proposed committee
substitute (CS) for HB 59, labeled 29-LS0257\S, Martin, 2/24/15,
as the working draft.
4:18:04 PM
CHAIR SEATON objected for discussion.
4:18:22 PM
TANEEKA HANSEN, Staff, Representative Paul Seaton, Alaska State
Legislature, explained the changes contained in the proposed CS,
paraphrasing from a prepared statement, which read:
Section 5:
Page 4, line 7 & 11
Registration is replaced with license.
Section 6:
Page 4, lines 26 - page 5, line 2
Language requiring the regulations to include
prohibitions on the combination of marijuana with
alcohol and nicotine has been deleted. Language
requiring the regulations to prohibit the sale of
marijuana in an establishment which sells alcohol has
also been removed.
New language was added which states that the
regulations created by the board may include
prohibitions on combining marijuana concentrates with
other addictive substances or requirements that new
products be certified before they are available for
retail.
Section 12:
Page 6, lines 8 - 15
Subsections (j), (k), and (l) have been added.
Subsection (j) allows the board by regulation to
create the number or type of licenses necessary for
implementation. Subsection (k) prohibits the issues
of a license for a marijuana retail store to a person
who holds a license under AS 04. Subsection (l)
states that a license issued to a marijuana
manufacturing facility does not authorize the facility
to combine marijuana with tobacco, nicotine, or
alcohol or products containing them.
Section 22
Page 8, lines 23 -25
The words 'through the use of a solvent other than
water' have been removed from the definition of
concentrates.
4:22:12 PM
CHAIR SEATON removed his objection, therefore, the proposed
committee substitute (CS) for HB 59, labeled 29-LS0257\S,
Martin, 2/24/15, was adopted as the working draft.
4:22:30 PM
REPRESENTATIVE WOOL objected and, referring to page 6, line 12,
asked about the license requirement.
CHAIR SEATON relayed that an amendment would be included to
correct that language.
REPRESENTATIVE STUTES said that her question was similar to that
of the previous member's and offered her understanding that the
proposed bill did not prohibit a liquor license holder from
holding a license for the sale of marijuana, although these
could not necessarily be sold in the same establishment.
MS. HANSEN, in response, offered her belief that subsection (k),
as written, could be interpreted in that way; therefore,
Amendment S.1 would be proposed for clarification.
4:24:40 PM
REPRESENTATIVE WOOL removed his objection. There being no
further objection, CSHB 59, Version S, was adopted as the
working draft.
4:25:01 PM
REPRESENTATIVE VAZQUEZ moved to adopt an amendment, labeled 29-
LS0257\S.1, Martin, 2/25/15, which read:
Page 1, line 2, following "establishments;":
Insert "relating to alcoholic beverages and
marijuana;"
Page 2, following line 3:
Insert a new bill section to read:
"* Sec. 2. AS 04.16 is amended by adding a new
section to read:
Sec. 04.16.165. Restriction on sale of marijuana
on licensed premises. A licensee may not sell, offer
for sale, furnish, or deliver marijuana on licensed
premises."
Renumber the following bill sections accordingly.
Page 6, lines 10 - 12:
Delete all material and insert:
"(k) A marijuana retail store license issued
under this section does not authorize the sale,
offering for sale, furnishing, or delivery of
alcoholic beverages on licensed premises."
CHAIR SEATON objected for discussion.
4:27:16 PM
CHAIR SEATON labeled this Amendment S.1, and reviewed it as a
means for removing the person and placing the burden on an
establishment in order to address the issue of self-medication
by individuals. This would prohibit individuals from purchasing
recreational marijuana in an alcohol sales establishment.
CHAIR SEATON removed his objection.
4:28:11 PM
REPRESENTATIVE WOOL objected, asking for clarification that
Section 12, subsection (k) would not authorize the sale of
alcoholic beverages in a marijuana retail sale store, or vice
versa. He reflected that previous testimony by Ms. Franklin,
[Director of the Alcoholic Beverage Control Board] had suggested
that licensing that would allow on premise consumption of
marijuana could occur in the future. He asked if the proposed
amendment only addressed purchases or if it also applied to on
the premise consumption.
CHAIR SEATON explained that the on the premise consumption would
be allowed for either marijuana or alcohol, but not for both
products under the proposed bill. The proposed bill did not
prevent a license for usage or sale on premise, it only
maintained a separation of usage in the same establishment.
REPRESENTATIVE WOOL asked if this was a concurrent issue in
another committee.
4:30:59 PM
MS. HANSEN offered her belief that SB 62 had similar language
restricting the sale of marijuana in an establishment licensed
for alcohol sale, and that it may be more restrictive by
limiting the ownership of licenses for sales of both.
4:31:24 PM
REPRESENTATIVE WOOL removed his objection. There being no
further objection, Amendment S.1 was adopted.
4:31:49 PM
REPRESENTATIVE VAZQUEZ moved to adopt an amendment, labeled 29-
LS0257\S.1, Martin, 2/25/15, which read:
Page 2, line 5:
Delete "Notwithstanding any other provision of
law, the"
Insert "The [NOTWITHSTANDING ANY OTHER PROVISION
OF LAW, THE]"
Page 2, line 6:
Delete ", and permitted by,"
Page 2, line 24:
Delete "Notwithstanding any other provision of
law, the"
Insert "The [NOTWITHSTANDING ANY OTHER PROVISION
OF LAW, THE]"
Page 2, line 25:
Delete ", and permitted by,"
Page 3, line 11:
Delete "Notwithstanding any other provision of
law, the"
Insert "The [NOTWITHSTANDING ANY OTHER PROVISION
OF LAW, THE]"
Page 3, line 12:
Delete ", and permitted by,"
CHAIR SEATON labeled this Amendment 2 and objected for
discussion.
4:33:32 PM
MS. HANSEN explained Amendment 2, which was primarily conforming
language to SB 30 dealing with the criminal statutes, and
deleting the language for "notwithstanding any other provisions
of law." She noted the removal of "and permitted by" which had
allowed a temporary delay for the concentrates, stating that it
was no longer necessary with the deletion of the aforementioned
language for notwithstanding.
4:34:43 PM
CHAIR SEATON removed his objection. There being no further
objection, Amendment 2 was adopted.
4:35:13 PM
CHAIR SEATON opened public testimony.
4:36:35 PM
TIM HINTERBERGER, Ph.D., Chair, Campaign to Regulate Marijuana
Like Alcohol in Alaska, stated opposition to proposed HB 59. He
pointed out that Ballot Measure 2 had been approved by 53
percent of Alaska voters on November 3, and would effectively
replace the unregulated, underground market for marijuana with a
regulated system of tax paying businesses. He noted that the
legislature's ability to modify this initiative was restricted
for two years, and he expressed confidence in the Alcoholic
Beverage Control Board for undertaking a mandate to provide
regulations under the timelines required by the ballot measure.
He stated that delay of any implementation would contradict the
will of the voters, declaring that concentrates were included
under the definition of marijuana in Ballot Measure 2, and the
manufacture, sales, and possession of these products should be
treated with parity to marijuana flower products. He stated
that the campaign maintained the position that proposed HB 59
was unconstitutional as currently drafted. He directed
attention to the handout titled "Specific Concerns With the
Current Version of HB 59" [Included in members' packets].
4:38:53 PM
RACHELLE YEUNG, Legislative Analyst, Marijuana Policy Project,
directed attention to the handout titled "Specific Concerns With
the Current Version of HB 59" [Included in members' packets] and
stated that it was substantively quite similar to an earlier
memo. She emphasized that the campaign wanted to clarify its
concerns for the intent and the effect of HB 59, as it appeared
the intent was not aligned with the will of the voters. She
offered the campaign's belief that the proposed bill was not
constitutional in its intent. She stated that concentrates were
included under the definition of marijuana in Ballot Measure 2,
and, as it was not distinguished from the marijuana plant or
flower, the mandate to the legislature was to not interfere with
or alter the timeline for implementation of the marijuana
regulations. She declared that neither the proposed committee
substitute nor these amendments had altered the concerns and
that the bill remained inconsistent with the initiative passed
by the voters. She offered support for discussion to the
concerns of potential dangers with production of concentrates
and to address the concerns in a constitutional manner that was
consistent with Ballot Measure 2.
4:42:16 PM
CHAIR SEATON closed public testimony.
4:43:02 PM
CHAIR SEATON asked for an opinion on the provision of the bill
which separated the combining of nicotine with marijuana. He
opined that this was the mixing of an addictive product with a
product that may have psychological dependence and questioned
whether a prohibition should be implemented.
ALLISON KULAS, Program Manager, Tobacco Prevention and Control,
Division of Public Health, Department of Health and Social
Services, stated that the division had not taken an official
position, and, although they were tracking the science, they had
not come across anything discussing the combination of nicotine
or tobacco or alcohol with marijuana.
4:44:26 PM
REPRESENTATIVE VAZQUEZ asked about the combination of cannabis
and alcohol.
MS. KULAS replied that, although there was not any specific
science for the combination of the two, it would most likely
result in greater impairment, and that there was a concern for
the addictive properties of marijuana.
REPRESENTATIVE VAZQUEZ asked if Department of Health and Social
Services had a position on the proposed bill.
MS. KULAS replied that the department did not have a position,
at this point.
4:45:13 PM
REPRESENTATIVE WOOL asked if there was anyone who could provide
a response regarding the combination aspect.
MS. KULAS explained that the evidence was being considered and
the department was following the lead of Colorado, as that state
had done an extensive literature review for marijuana addiction.
4:46:07 PM
CHAIR SEATON reported that the proposed bill was designed to
address a developing industry. He shared that the ABC Board
anticipated successful completion of the regulations. They had
requested additional staff, although given the current financial
situation, authorization was not ensured. The purpose of the
proposed bill was to ensure full regulations on cultivation,
processing, and retail sales by the industry. If necessary, a
delay could be placed on the manufacture and sale of new
products. He pointed out that the delay would be based on the
implementation of recommendations by the board and could not
exceed the projected timeframe.
4:48:18 PM
REPRESENTATIVE WOOL disclosed that he was currently a license
holder under AS 04. He mused that these restrictions, as they
were not in the last version of the bill, prompted further
questioning. He shared that the ABC Board representatives had
stated they were prepared to write regulations and restrictions
on marijuana use based on their experiences with the control and
regulation for the use of alcohol. He noted that members of the
licensing world also declared a readiness for these issues
regarding systems of control and regulations.
4:49:56 PM
REPRESENTATIVE WOOL asked about the ABC Board's position
regarding the restriction of license holders under AS 04 with
relationship to the potential sale of marijuana.
CYNTHIA FRANKLIN, Director, Alcoholic Beverage Control (ABC)
Board, in response, explained that most of the restrictions
related to alcohol were centered on a premises based approach
with control of the area of sales, manufacture, or delivery, and
there were not any restrictions on other businesses by alcohol
licensees. She stated that the application to qualify for
liquor licenses was "a fairly straightforward process." She
offered her hope that the regulations for the application and
licensing process for obtaining a marijuana based license would
be left to the ABC Board or a newly created marijuana control
board. She opined that it was difficult for the legislature "to
find your spot in this voter initiative" and she expressed
appreciation for the effort to allow for additional time, as
well as concern for the constitutionality requirements. She
stated that the specifications for who may or may not get
marijuana business licenses begs the need for the regulatory
agency to develop the regulations with an extended public input
period. She acknowledged the earlier statements for
consideration that changes may occur as the industry progresses
and those details would need to be addressed during the
regulatory process, as statutes were much harder to change. She
opined that a prohibition for certain people to obtain marijuana
licenses "might be risky business."
4:53:19 PM
CHAIR SEATON clarified that the proposed bill had been amended
to address establishments and not persons, and that it
prohibited the sale of both alcohol and marijuana in an
establishment.
MS. FRANKLIN acknowledged the amendment, although she had
understood the question to be for the simultaneous holding of
licenses.
4:54:28 PM
The committee took a brief at-ease.
4:55:14 PM
CHAIR SEATON stated that HB 59 would be held over.
4:55:31 PM
ADJOURNMENT
There being no further business before the committee, the House
Health and Social Services Standing Committee meeting was
adjourned at 4:55 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| DPA Program Descriptions - All with regs and budget.pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| Heating Assistance Program 02.05.2015 Fact Sheet.pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| ATAP Fact Sheet 020915.pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| WIC FNP Fact Sheet.pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| TANF - WS NFAP Fact Sheet.pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| Tribal TANF Fact Sheet 2.05.2015.pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| SBP Fact Sheet (02-03-15).pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| Division of Public Assistance Presentation_2.25.2015.pdf |
HHSS 2/26/2015 3:00:00 PM |
Presentations by DHSS |
| HB 59 Version S_proposed CS.pdf |
HHSS 2/26/2015 3:00:00 PM |
HB 59 |
| HB 59 Sectional Analysis_Version S.pdf |
HHSS 2/26/2015 3:00:00 PM |
HB 59 |
| HB 59 Explanation of changes_ver P to S.pdf |
HHSS 2/26/2015 3:00:00 PM |
HB 59 |
| HB 59_Legal Opinion_Does HB 59 require additional licenses.pdf |
HHSS 2/26/2015 3:00:00 PM |
HB 59 |
| HB 59 Ver S proposed amendment 1.pdf |
HHSS 2/26/2015 3:00:00 PM |
HB 59 |
| HB 59 Ver S Proposed Amendment 2.pdf |
HHSS 2/26/2015 3:00:00 PM |
HB 59 |
| HB 59 S_letter of opposition_MPP.pdf |
HHSS 2/26/2015 3:00:00 PM |
HB 59 |