Legislature(1997 - 1998)
03/14/1997 01:08 PM House JUD
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE JUDICIARY STANDING COMMITTEE
March 14, 1997
1:08 p.m.
MEMBERS PRESENT
Representative Joe Green, Chairman
Representative Con Bunde, Vice Chairman
Representative Brian Porter
Representative Norman Rokeberg
Representative Jeannette James
Representative Eric Croft
Representative Ethan Berkowitz
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 53
"An Act relating to the authority of the Department of Corrections
to contract for facilities for the confinement and care of
prisoners, and annulling a regulation of the Department of
Corrections that limits the purposes for which an agreement with a
private agency may be entered into; authorizing an agreement by
which the Department of Corrections may, for the benefit of the
state, enter into one lease of, or similar agreement to use, space
within a correctional facility that is operated by a private
contractor, and setting conditions on the operation of the
correctional facility affected by the lease or use agreement; and
giving notice of and approving a lease-purchase agreement or
similar use-purchase agreement for the design, construction, and
operation of a correctional facility, and setting conditions and
limitations on the facility's design, construction, and operation."
- HEARD AND HELD; ASSIGNED AMENDMENTS 3 AND 4 TO SUBCOMMITTEE
HOUSE BILL NO. 150
"An Act giving notice of and approving a lease-purchase agreement
with the City of Seward for the construction and operation of an
addition to the Spring Creek Correctional Center, and setting
conditions and limitations on the facility's construction and
operation."
- SCHEDULED BUT NOT HEARD
* HOUSE BILL NO. 115
"An Act making corrective amendments to the Alaska Statutes as
recommended by the revisor of statutes; and providing for an
effective date."
- BILL POSTPONED TO 3/17
CS FOR SENATE BILL NO. 1(FIN) am
"An Act relating to living and working conditions of prisoners in
correctional facilities operated by the state, and authorizing the
commissioner of corrections to negotiate with providers of
detention and confinement services under contract to apply those
conditions and limitations on services to persons held under
authority of state law at facilities operated under contract or
agreement; relating to services provided to prisoners; amending the
definition of `severely medically disabled' applicable to prisoners
seeking special medical parole; amending provisions of the
correctional industries program; and extending the termination date
of the Correctional Industries Commission and the program."
- BILL POSTPONED TO 3/19
CONFIRMATION HEARINGS ON GOVERNOR'S APPOINTS TO: Violent Crimes
Compensation Board
- CONFIRMATION HEARINGS POSTPONED TO 3/17
(* First public hearing)
PREVIOUS ACTION
BILL: HB 53
SHORT TITLE: LEASE-PURCHASE CORRECTIONAL FACILITY
SPONSOR(S): REPRESENTATIVE(S) MULDER
JRN-DATE JRN-PG ACTION
01/13/97 41 (H) PREFILE RELEASED 1/10/97
01/13/97 41 (H) READ THE FIRST TIME - REFERRAL(S)
01/13/97 41 (H) STATE AFFAIRS, FINANCE
02/19/97 406 (H) JUD REFERRAL ADDED
02/21/97 428 (H) STA REFERRAL WAIVED
02/21/97 428 (H) REFERRED TO JUDICIARY
03/07/97 (H) JUD AT 1:00 PM CAPITOL 120
03/07/97 (H) MINUTE(JUD)
03/10/97 (H) JUD AT 1:00 PM CAPITOL 120
03/10/97 (H) MINUTE(JUD)
03/12/97 (H) JUD AT 1:00 PM CAPITOL 120
03/12/97 (H) MINUTE(JUD)
03/14/97 (H) JUD AT 1:00 PM CAPITOL 120
WITNESS REGISTER
DENNIS DeWITT, Legislative Assistant
to Representative Eldon Mulder
Alaska State Legislature
Capitol Building, Room 501
Juneau, Alaska 99811
Telephone: (907) 465-2647
POSITION STATEMENT: Testified on behalf of sponsor of HB 53.
REPRESENTATIVE ELDON MULDER
Alaska State Legislature
Capitol Building, Room 501
Juneau, Alaska 99811
Telephone: (907) 465-2647
POSITION STATEMENT: Sponsor of HB 53.
FORREST BROWNE, Debt Manager
Treasury Division
Department of Revenue
P.O. Box 110405
Juneau, Alaska 99811-0405
Telephone: (907) 465-3750
POSITION STATEMENT: Provided department's position and answered
questions regarding HB 53.
KEITH GERKEN, Architect
Division of General Services
Department of Administration
P.O. Box 110210
Juneau, Alaska 99811
Telephone: (907) 465-5683
POSITION STATEMENT: Provided department's position and answered
questions regarding HB 53.
ACTION NARRATIVE
TAPE 97-39, SIDE A
Number 0001
CHAIRMAN JOE GREEN called the House Judiciary Standing Committee
meeting to order at 1:08 p.m. Members present at the call to order
were Representatives Bunde, Porter, Rokeberg, Croft, Berkowitz and
Green. Representative James arrived at 1:10 p.m.
CHAIRMAN GREEN announced that Representative Porter had to leave at
1:30 p.m. On Monday, March 17, Chairman Green would be out of town
and Vice Chairman Bunde would chair that meeting. A listen-only
teleconference would take place Saturday, March 22, to hear
testimony by two clergy on the death penalty issue.
HB 53 - LEASE-PURCHASE CORRECTIONAL FACILITY
Number 0138
CHAIRMAN GREEN advised members they would hear House Bill No. 53,
"An Act relating to the authority of the Department of Corrections
to contract for facilities for the confinement and care of
prisoners, and annulling a regulation of the Department of
Corrections that limits the purposes for which an agreement with a
private agency may be entered into; authorizing an agreement by
which the Department of Corrections may, for the benefit of the
state, enter into one lease of, or similar agreement to use, space
within a correctional facility that is operated by a private
contractor, and setting conditions on the operation of the
correctional facility affected by the lease or use agreement; and
giving notice of and approving a lease-purchase agreement or
similar use-purchase agreement for the design, construction, and
operation of a correctional facility, and setting conditions and
limitations on the facility's design, construction, and operation."
CHAIRMAN GREEN noted that there were a number of proposed
amendments.
REPRESENTATIVE NORMAN ROKEBERG asked whether they were still
addressing version 0-LS0194\K.
CHAIRMAN GREEN confirmed that. He said they would begin with the
three amendments submitted by himself, 0-LS0194\K.30, K.31 and K.32
(revised), followed by amendments submitted by Representatives
Rokeberg (K.37), Croft and Berkowitz.
CHAIRMAN GREEN invited Representative Mulder and Dennis DeWitt to
join members at the table.
CHAIRMAN GREEN offered Amendment 1, 0-LS0194\K.30, Chenoweth,
3/10/97, which read:
Page 2, line 9:
Delete "that is unable"
Insert "unless the agency demonstrates the qualifications
and experience necessary"
Page 2, line 10, following "state":
Insert "and by regulations that are adopted by the
commissioner"
REPRESENTATIVE BRIAN PORTER objected for the purpose of discussion.
Number 0343
CHAIRMAN GREEN explained that Amendment 1 expands the language so
there is no question that the builder of the facility would
demonstrate the qualifications and experience necessary to
accomplish what is proposed under a private prison facility; these
regulations would be adopted by the commissioner.
REPRESENTATIVE ROKEBERG referred to line 6 of Amendment 1. He
asked whether adding the language, "and by regulations that are
adopted by the commissioner", would not delay the commissioner's
ability to go out to bid with a Request for Proposals (RFP) by
requiring the writing of a series of regulations that may be
superfluous and by requiring going through the Administrative
Procedure Act (APA). Representative Rokeberg asked Chairman Green
to explain the intent.
CHAIRMAN GREEN replied that it meant regulations would be
established. He questioned how one would determine a person's
ability to do this unless there were regulations to go by. They
had not wanted to put that in statute.
Number 0541
REPRESENTATIVE JEANNETTE JAMES understood it to mean any current
regulations relating to the degree of custody, which is an issue
that is not necessarily to be changed by a new facility.
CHAIRMAN GREEN noted that "adoption" implies something in the
future. He asked whether that was Representative Rokeberg's
objection.
REPRESENTATIVE JAMES suggested if it read, "existing regulations",
it would be more clear.
REPRESENTATIVE PORTER asked whether Chairman Green would concede to
a friendly amendment adding language to make the sentence read,
"and by existing regulations that have been adopted by the
commissioner".
CHAIRMAN GREEN suggested that would imply that no new regulations
could be implemented.
REPRESENTATIVE PORTER said that was the only way he would support
the amendment.
REPRESENTATIVE ERIC CROFT said it was appropriate, in this entirely
new area, that there be regulations implementing the new statute.
Regulations are required to conform to the statute, not contradict
it. Although a regulation sometimes strays from the intent of a
bill, that can be specifically corrected by court action if a
regulation goes beyond its enabling statute. The department is
given a large degree of deference in that area, and if they do not
even have the normal deference provided by the legislature to write
a regulation following a statute, Representative Croft did not
understand the reason for giving them deference in every other area
except the one they traditionally had.
Number 0717
REPRESENTATIVE PORTER explained that the task they were asking the
commissioner to perform, if the amendment was adopted, was ensuring
that the agency demonstrated the qualifications and experience
necessary to be able to provide the care, custody and discipline to
the extent required by the laws of the state of Alaska. Those laws
exist. They do not need a new regulation to require the
commissioner to write a regulation as to whether or not someone has
the ability to meet an existing law. He noted that to the extent
that they have to follow their own regulations in any existing
procedures, he would approve. However, to write a regulation
requiring going through the APA to give an opinion on whether
somebody meets the law seemed a bit cumbersome.
REPRESENTATIVE JAMES pointed out that under the context of this
statement, they were not talking about regulations that would be
written as a result of this legislation. Rather, they were talking
about what kinds of consideration would be necessary before the
commissioner entered into an agreement with an agency. She
suggested there may be another way to do that. She further
suggested the gist of the amendment was to say, "and discipline to
the extent required by the statutory or regulatory laws of the
state which would be in effect at this time." She believed the
purpose was clear: They would not accept any lesser quality of
treatment, care or custody than currently existed under the laws of
the state, including existing regulations.
Number 0860
REPRESENTATIVE ETHAN BERKOWITZ said the problem he had with
inserting "existing" regulations was that presently all regulations
were coming under scrutiny. If some were eliminated, there could
be confusion as to whether the regulations existing at the time of
enactment would preclude eliminating regulations down the road.
His personal sense was that when there are regulations, any sort of
evaluation should be more objective. There are standards by which
the commissioner and the private contracting agency can gauge each
other's conduct. Without regulations, it would be entirely
subjective.
REPRESENTATIVE ROKEBERG made a motion to divide the question on
Amendment 1.
CHAIRMAN GREEN had no objection. Lines 1 through 4 of Amendment 1,
amending page 2, line 9, became Amendment 1-A. Lines 5 and 6 of
Amendment 1, amending page 2, line 10, became Amendment 1-B.
REPRESENTATIVE JAMES referred to Amendment 1-B and said the
language, "as required by the laws of the state", is inclusive of
statutory and regulatory laws and therefore unnecessary. However,
if they wanted to be perfectly clear that any regulations would be
included, they could refer to "administrative law."
REPRESENTATIVE JAMES said even beyond that, the legislature did not
expect an agency to enter into an agreement that would be changed
by a regulation before they do it, setting it up so that no one
could qualify. She did not believe that was the intent of the
amendment. She believed the intent was to ensure that all existing
rules and regulations are applied so that any agreement would be
"taking care of things the same way as they had been all along."
CHAIRMAN GREEN asked whether there was any objection to Amendment
1-A. There being none, Amendment 1-A was adopted.
CHAIRMAN GREEN asked whether there was further discussion on
Amendment 1-B.
REPRESENTATIVE ROKEBERG advised members he was not in support of
Amendment 1-B. He concurred with Representative James that the
proposed language was redundant. He asked for the sponsor's
opinion.
CHAIRMAN GREEN, without objection, withdrew Amendment 1-B.
Number 1119
Representative Porter departed, as he had a bill before the House
Finance Committee meeting.
CHAIRMAN GREEN offered Amendment 2, 0-LS0194\K.31, Chenoweth,
3/10/97, which read:
Page 3, following line 3:
Insert a new bill section to read:
"* Sec. 2. AS 33.03.031(c) is amended to read:
(c) An [NOTWITHSTANDING AS 36.03.300, AN] agreement
with a private agency to provide necessary facilities
under (a) of this section must, notwithstanding AS
36.30.300, be used on competitive bids. The commissioner
may not enter into an agreement with a private agency to
provide necessary facilities in the state unless the
agency
(1) posts an adequate performance bond and
payment bond;
(2) demonstrates to the commissioner's
satisfaction the capability to provide the necessary
qualified personnel to implement the terms of the
contract; and
(3) provides a bond or certificate of
insurance sufficient to defend and indemnify the state
and a municipality in which the facility is located
against claims or liability arising from the operation of
the correctional facilities by the contractor."
Renumber the following bill sections accordingly.
Page 4, line 27:
Delete "sec. 4"
Insert "sec. 5"
Page 6, line 30:
Delete "sec. 3"
Insert "sec. 4"
Page 7, line 9:
Delete "sec. 4"
Insert "sec. 5"
REPRESENTATIVE ROKEBERG objected for the purpose of an explanation.
CHAIRMAN GREEN explained that even though it may be a private
contractor for a private prison, the concern exists that it is
being done for the state. The amendment requires an adequate bond
to ensure that if something happens, such as the contractor going
broke, the bond would be attachable so that the state would not end
up with "no prison and a lot of bond indebtedness."
REPRESENTATIVE ROKEBERG asked for the sponsor's opinion.
REPRESENTATIVE MULDER deferred to Dennis DeWitt.
Number 1189
DENNIS DeWITT, Legislative Assistant to Representative Eldon
Mulder, advised members that these are performance standards and
bonds, and insurance requirements, that may or may not be
appropriate in each case. If they are addressed statutorily, there
is not the full range of options for indemnity from which to
choose.
MR. DeWITT pointed out that in the model RFP form published by the
Department of Administration (DOA), the template has insurance
requirements and explanations of additional terms of condition, bid
bonds, performance bonds and surety deposits, depending on what the
RFP is for and tailored specifically to it.
MR. DeWITT explained that the required contract, under Appendix
B(1), requires indemnification and insurance such as workers'
compensation, general liability and auto liability, all of which
can be, and should be, required in the RFP. He said the important
thing, to him, is that there is a process covered in the
procurement code, the RFP model and the template that is required
to be used by the DOA to handle those issues. Including that
language in statute may produce a conflict, and it limits the
state's options in terms of getting the best surety that the
committee might be after.
REPRESENTATIVE ROKEBERG referred to line 9 of Amendment 2,
subsection (c)(1), which says "posts an adequate performance bond
and payment bond". He said that may be necessary where a
contractor was being asked to perform under the construction
contract but not under the operation contract, which might require
another type of bonding arrangement or additional sureties. He
said depending on how the RFP was drafted by the department, Mr.
DeWitt was advocating flexibility, whereas this amendment would
statutorily tie their hands, he assumed.
MR. DeWITT agreed that was the concern. However, there was also
concern that certain bonds and certificates of insurance can be
substantially more expensive than other kinds of sureties that are
just as protective to the state's interests. There was a
possibility that it would increase the cost of a project through
the state's choice of instruments, rather than through the
instruments chosen by the offerer and the agency signing the
contract.
Number 1367
REPRESENTATIVE BERKOWITZ suggested eliminating the terms
"performance bond" and "payment bond" and inserting "surety", which
would cover everyone's concerns.
CHAIRMAN GREEN accepted that as a friendly amendment.
REPRESENTATIVE ROKEBERG spoke to the friendly amendment, saying he
thought performance bonds are necessary under the construction
phase, while the surety would be more appropriate for the
operational phase. He had been thinking of specifying that these
particular items are for the construction phase of the project,
which he suggested might be more acceptable to the sponsor.
CHAIRMAN GREEN referred to line 9, (c)(1), and line 13, (c)(3), of
Amendment 2. He said wherever they were talking about those kinds
of things, they were just saying "adequate surety", to which he had
no objection. That would separate any problems between the
construction and the operation.
Number 1440
REPRESENTATIVE JAMES was concerned because subsection (c) says,
"provide necessary facilities", but nothing about operating them.
She would therefore believe that this language has referred to
construction, not operation.
REPRESENTATIVE MULDER advised members that he supported what the
amendment was attempting to do; however, he opposed it from the
standpoint that they were implying lack of confidence in the
Department of Administration's ability to protect the state. He
expressed confidence in the department, adding that this would come
back before the legislature for review and the DOA would be held
accountable for their actions.
REPRESENTATIVE MULDER pointed out that the bill is extremely
flexible, by design, to try to give the commissioner a full range
of options to capture the most savings. He believed that Amendment
2 may limit their opportunity in relation to perhaps contracting
through a municipality where it says, "the commissioner may not
enter into an agreement with a private agency to provide ...
facilities".
CHAIRMAN GREEN pointed out that "unless" followed that language.
REPRESENTATIVE MULDER agreed.
CHAIRMAN GREEN said if that was already being done, they should
have no objection. All it said was "surety", which provides a wide
range of flexibility but does require that they do it. He felt it
would be in the state's best interest to insist that they provide
adequate surety.
REPRESENTATIVE ROKEBERG suggested that departmental personnel could
comment, based on points made by the sponsor and the ability to
finance the bond package that may or may not result.
Number 1568
REPRESENTATIVE CROFT said what was remarkable was how little the
amendment ties the state's hands and how general it is. It simply
requires an adequate bond; if the friendly amendment was accepted,
it would simply require adequate surety. Subsection (2), nobody
had quibbled with, and he believed it would be hard to demonstrate
capability to the commissioner's satisfaction. Under subsection
(3), it requires simply sufficient insurance.
REPRESENTATIVE CROFT emphasized that it set general guidelines to
implement in the RFP, and the sponsor and Mr. DeWitt had indicated
those would be required under the RFP anyway. Representative Croft
did not see the problem. He believed those should be required, and
he would worry if they were not.
REPRESENTATIVE MULDER expressed that he would like to hear from the
Department of Revenue or the Department of Administration in
relation to current contracts.
Number 1656
FORREST BROWNE, Debt Manager, Treasury Division, Department of
Revenue, advised members that from his department's standpoint,
what the amendment requires is done as a matter of course on RFPs.
It certainly would not hurt for the bill to specify it, although in
his opinion, it was probably not required.
KEITH GERKEN, Architect, Division of General Services, Department
of Administration, reported that current statutes specify the
minimum requirements for bonding and insurance by either the
Department of Transportation, for construction, or the Department
of Administration, for nonconstruction elements. As far as he
knew, there was no limitation as to how much above that minimum one
could go in a given proposal, whether for construction or for
services.
MR. GERKEN believed there would be a fair amount of discussion
among the Departments of Law, Administration, Transportation/Public
Facilities, Revenue and Corrections, and anyone else involved, in
setting the reasonable amount in any case. He stated that the
problem with that unique kind of an RFP is knowing how much
insurance to impose upon the proposers, without making it
unaffordable. Mr. Gerken assured members that that would be a
fundamental part of preparing the RFP because the state would be
concerned about whatever liabilities might exist.
CHAIRMAN GREEN asked whether that would be onerous or time-
consuming.
MR. GERKEN said establishing a required level for proposers could
be onerous if they required too much insurance, which would
effectively limit the competition. They would want to strike a
balance between protecting the state's interests and not making the
proposals uncompetitive or unable to respond to what the state
requires. Mr. Gerken believed that a conversation must occur as
part of putting the proposal together. He did not know whether
anyone today knows what those limits should be for this kind of
RFP.
Number 1765
REPRESENTATIVE BERKOWITZ suggested that inclusion of this provision
would clarify any ambiguity regarding sureties with this new
entity, the private prison contractor/operator.
MR. GERKEN responded that he did not know that it added clarity.
He believed that a conversation would occur about what level should
be required. If the committee prescribed a specific level, that
would provide clarity. But for anything short of that, a
discussion of balance would have to take place.
REPRESENTATIVE BERKOWITZ asked whether that level of clarity could
come about through either contractual negotiations or regulation.
MR. GERKEN did not think it would be in regulation but simply would
be a part of the RFP. The agencies crafting the RFP would make a
determination, independently for the construction and
nonconstruction elements, about what kind of bonding, surety and
insurance requirements above state minimums may or may not be
required, if any.
Number 1820
CHAIRMAN GREEN asked whether by having it in statute, it would not
be subject to changes in regulations or procedures. The proposed
amendment would say, "yes, you will," which might be good because
there would be dialogue, then, between the agencies involved.
MR. GERKEN said the dialogue would happen in any case, because the
agencies need to be looking out for the state's interests.
CHAIRMAN GREEN requested confirmation that it was not doing
anything that the state does not already do.
MR. GERKEN believed that was a fair statement.
REPRESENTATIVE JAMES asked whether the friendly amendment to
Amendment 2, to change subsection (c)(1) to "posts adequate
surety", had been accepted.
CHAIRMAN GREEN said yes, although they had not voted on it.
REPRESENTATIVE JAMES asked whether that only applied in one place.
CHAIRMAN GREEN affirmed that.
REPRESENTATIVE JAMES noted that this, by itself, just talks about
facilities. Then under (c)(3), it refers also to operations. She
assumed that something ahead of that in AS 33.30.031 tied those
together. Given that, she did not believe the statements in there
made much difference. However, she would support the amendment.
MR. DeWITT expressed concern that those issues referred to by Mr.
Gerken were already statutory. The question was: If they again
enacted them, would it change the current statutory base, which is
not regulatory and cannot be changed through a regulatory action?
REPRESENTATIVE JAMES asked the sponsor whether he believed
restating it was a problem.
MR. DeWITT replied that while he was in the bureaucracy, the
question he would ask if a statute was restated was, "What's the
new message?" He suggested department personnel would ask the same
question.
Number 1995
REPRESENTATIVE JAMES acknowledged that concern. However, if
putting out an RFP for construction and operation of a facility was
new, this would restate that the existing rules apply.
MR. DeWITT said the problem is that most of the people who would be
dealing with the issue administratively were not present and would
not have the benefit of the discussion of, "all we wanted to do is
reiterate what was here." In addition, between now and decision-
making time, there were likely to be other changes. He said it
takes a lot of time to trace it back to find out that all they were
doing is "something benign and reminding."
Number 2019
REPRESENTATIVE ROKEBERG expressed that he did not want to confuse
the issue; however, for the purpose of discussion, he had a
friendly amendment to offer that would add some meat to the bone,
to add a new subsection (c)(4), to read, conceptually, "The terms
and conditions of RFPs formulated under this subsection shall not
be constructed so as to limit competition."
CHAIRMAN GREEN suggested to alleviate concern, they could state
that this in no way would be redundant or conflict with existing
law.
REPRESENTATIVE CROFT noted that they had started out having
complete faith in the department, with complete discretion, and now
they were worried that the department would use the words "adequate
surety" or "sufficient insurance" to stifle the process.
Representative Croft stated his opinion that Amendment 2 provides
adequate assurance that the department is making these assurances
but does not tie their hands or allow them to do mischief.
CHAIRMAN GREEN, noting acceptance of the friendly amendment to line
9 of Amendment 2, to delete the words following "adequate" and
insert "surety", asked whether the objection was maintained.
REPRESENTATIVE ROKEBERG said yes.
CHAIRMAN GREEN requested a roll call vote on Amendment 2. In
favor: Representatives Bunde, James, Croft, Berkowitz and Chairman
Green. Opposed: Representative Rokeberg. Representative Porter
was absent. Therefore, Amendment 2, including the friendly
amendment, was adopted 5 to 1.
Number 2280
CHAIRMAN GREEN moved Amendment 3 (revised from 0-LS0194,\K.32,
Chenoweth, 3/10/97, which was not submitted). Amendment 3 read:
Page 3, following line 3:
Insert a new bill section to read:
"*Sec. 2. AS 33.03.031 is amended by adding a new
subsection to read:
(f) The commissioner may not enter into an
agreement to provide necessary facilities under (a) of this
section as a correctional facility that is to be constructed
in this state after the effective date of this Act unless the
commissioner initiates and completes a site selection process.
The site selection process must provide the public reasonable
opportunity to comment about sites to be considered for the
location of the correctional facility. In additions [sic],
if, on the basis of the site selection process, the
commissioner determines to enter into an agreement to contract
for provision of necessary facilities at a correctional
facility that is to be located at a site within a municipality
or legal subdivision of the state, the correctional facility
may not be constructed at the site unless approved by a
majority of the voters within the "affected area" voting at an
election conducted by the municipality or legal subdivision of
the state. For the purpose of this subsection, "affected
area" means the area within 2 miles of the external perimeter
of the correctional facility. This restriction does not apply
to construction within the perimeter of correctional
facilities in existence before the effective date of this act.
[end-quote omitted]
Renumber the following bill sections accordingly.
Page 4, line 27:
Delete "sec. 4"
Insert "sec. 5"
Page 6, line 30:
Delete "sec. 3"
Insert "sec. 4"
Page 7, line 9:
Delete "sec. 4"
Insert "sec. 5"
CHAIRMAN GREEN explained that Amendment 3 would require that once
a site selection was made, an affirmative vote of the citizenry
within a two-mile radius of the perimeter of the facility would be
required, establishing a local veto power.
REPRESENTATIVE BERKOWITZ asked that Chairman Green explain the two-
mile requirement.
CHAIRMAN GREEN stated that rather than requiring a total vote of
the entire municipality, it would require a total vote of the
affected people, and two miles appeared to be a reasonable radius.
REPRESENTATIVE BERKOWITZ felt it would be somewhat difficult to
determine which voters were within the two-mile radius, especially
at the edge of a district.
CHAIRMAN GREEN said the perimeter of the proposed facility would be
established, then they would go two miles in any direction on a
map.
Number 2360
REPRESENTATIVE CON BUNDE referred to the possibility of placing a
prison in an unorganized area. If there were six people within the
two-mile radius, for example, would those six have authority to
determine the outcome?
CHAIRMAN GREEN indicated it would require four of those six.
REPRESENTATIVE JAMES said she would assume the bid proposals
submitted would include a facility site, which would go before the
voters within a two-mile radius. She was concerned that if the
people knew who the contracting bidders were, they could basically
choose the bidder. She asked how far the process would go before
it went before the voters.
CHAIRMAN GREEN pointed out that site selection would occur prior to
designing a facility because it would be necessary to design for
the prospective area. Once a site was selected and approved by the
commissioner, the project would go out for bid; if not accepted by
the commissioner, it would be necessary to select another site.
REPRESENTATIVE JAMES asked: Who would pick the site, the
commissioner?
CHAIRMAN GREEN stated, "The commissioner may not enter into an
agreement until the site has been selected and approved."
REPRESENTATIVE JAMES asked: Who would select the site and put it
out for approval? And who would pay for the election?
CHAIRMAN GREEN said as stated in the amendment, it would be the
city or the subdivision of the state.
TAPE 97-39, SIDE B
Number 0006
REPRESENTATIVE JAMES said she agreed with the thought. But how it
would be done, when, and by whom were not clear to her.
CHAIRMAN GREEN explained that the commissioner may not enter into
an agreement to do that until there is a site selection approved by
the people who are affected.
REPRESENTATIVE JAMES understood, then, that the cost of the land
would not be part of the bid document, which would preclude people
from bidding on and using land that they already owned.
CHAIRMAN GREEN asked why it would preclude that.
REPRESENTATIVE ROKEBERG said Representative James's point was
accurate. Injecting the commissioner into the site selection
process would completely throw out the RFP process, and it
presupposes there would be a site selection prior to any
competition for the construction or operation of the facility.
Consequently, it would have to be on pre-selected land purchased by
the state or public land available some other way. Representative
Rokeberg said this does an extraordinary disservice to the state by
limiting the areas from which to choose.
REPRESENTATIVE ROKEBERG expressed that he was familiar with the
RFP-type bidding process for buildings. He asked the sponsor how
the language in Amendment 3, as well as in much of the bill, would
reflect on the statutory authority of the Department of Corrections
to procure other facilities such as Community Residential Center
(CRC) beds and other soft beds, in terms of their requirements. He
asked what impacts the statute and the bill would have on all RFPs
that the DOC may enter into, in their whole scope of acquisition of
real property.
Number 0121
REPRESENTATIVE MULDER said while he was sympathetic with the
direction Chairman Green was attempting to go, he did not think
Amendment 3 got them there. It would create a problem, for
example, in relation to half-way houses. He read from AS
33.30.901(4), which states, "`Correctional facility' or `facility'
means a prison, jail, camp, farm, half-way house, group home, or
other placement designated".
REPRESENTATIVE MULDER said this is really a municipal issue and
concern. He referred to AS 29.40.040, which states: "In
accordance with a comprehensive plan ... the provisions governing
the use and occupancy of land that may include, but are not limited
to, (1) zoning regulations". The statute already provides for
municipal governments to provide their own regulation on what
should and should not be, and on what is appropriate, and where.
If they want to establish further hurdles, hindrances or peer
review panels, that is appropriate within the municipal charter and
government.
REPRESENTATIVE MULDER said he did not have a problem with that;
however, he felt it would fetter state government unnecessarily to
try to have state policy determined by four people. A common good
that would benefit the state could be thwarted, literally, by four
people, and he felt that would set up a dangerous precedent within
state law.
REPRESENTATIVE MULDER said, although unintentional, this provision
would also set in policy a hinderance to private facilities that
did not exist for public facilities. For example, under current
state law, the commissioner could place a prison anywhere by
emergency regulation, without consideration of municipal
ordinances. He suggested it was appropriate for municipalities to
have discussions and perhaps put into their own municipal codes or
ordinances something that would deal with this situation.
CHAIRMAN GREEN thanked Representative Mulder for his explanation;
however, he took issue with the fact that it would do away with
half-way houses, for example, because the last sentence of
Amendment 3 states: "This restriction does not apply to
construction within the perimeter of correctional facilities in
existence before the effective date of this Act."
CHAIRMAN GREEN asked: With respect to future facilities, is it in
the state's best interest to use a site that adversely impacts
those closest to it? If four out of six people in a remote area
would be adversely affected, he felt the facility could be moved a
little. He noted that many areas in the state have no population,
including some areas close to municipalities.
CHAIRMAN GREEN stated, "This presupposes, by your objection, that
there will be objection to the facility. That tells me right away
there must be something in the public's interest, at least those
that are affected, that they should have a right to say no. I
mean, if they're going to build next to your house, would you say
no?"
REPRESENTATIVE MULDER pointed out that when the country was
established, there was discussion along the same lines. The
greater public good had always been a consideration of the founding
fathers and hence, the power of eminent domain. Nobody wants a
road down their back yard, because it tends to devalue property,
and yet roads have been considered to be a necessary, integral part
of society. Similarly, if the state determines the need to lock
people away, prisons are needed; to that end, they meet a public
need. To further that end, the prisons should be strategically
located to provide the necessary service.
REPRESENTATIVE MULDER stated that he was sensitive to Chairman
Green's concern. If the commissioner found that a facility should
be located in South Anchorage, for example, the municipality should
ensure a responsive, fair public process.
CHAIRMAN GREEN said he did not believe the proposed legislation
wanted to go to the point of compensating those who might be
adversely affected, which was done in eminent domain for highways.
He pointed out that for highways, exceptions were made, along with
condemnations and compensation.
Number 0380
REPRESENTATIVE ROKEBERG said he agreed with Representative Mulder.
He said there had been testimony in the building that year that the
Department of Corrections had endeavored to acquire CRC soft beds
in the Matanuska Valley and the Kenai area; both were turned down
by local groups. Subsequent to the "turn-down" of one location in
their community, the City of Kenai had identified nine different
sites that might be satisfactory for CRC beds. Representative
Rokeberg felt that if that was what the amendment intended to
accomplish, choosing a site from those that had been identified by
communities as acceptable, it would not. Instead, he believed the
proposed statute would virtually halt the corrections business in
Alaska, because it would require building a new facility at the
publicly-selected site acquisition, for which the City of Kenai
would ask the legislature for $5 million to build the facility.
REPRESENTATIVE ROKEBERG said when using CRC beds, they had to
acquire an existing multi-family dwelling, or another commercial-
type dwelling, for example, to convert into a CRC facility to
provide the necessary beds in a cost-effective manner. He stated,
"In other words, you can't go out there unless you have lots and
lots of money, and start out with a raw dirt site and build soft
beds." He restated that Amendment 3 would halt the entire
correction business in the state and could jeopardize public safety
overnight. He said that was an unintended consequence. It would
halt acquisition of soft beds in Alaska.
Number 0489
CHAIRMAN GREEN disagreed, saying several communities were begging
for a correctional site location.
REPRESENTATIVE ROKEBERG emphasized that he was talking about CRC
soft beds.
REPRESENTATIVE CROFT asked what statute Section 4 enacted. He
pointed out that Section 2 referred to AS 33.30.043; however,
Sections 3, 4 and so on do not provide a section number that they
enact.
MR. DeWITT explained that those are in codified statutes. He said
the section they were now discussing was in current statute. In
1987, when CRCs were first discussed, there were a number of points
in the statute relating to whether private facilities could be in
or out of state, as well as a host of other things relating
specifically to CRCs. The bill attempts to clean that statute up.
MR. DeWITT said in addition, there is language currently in statute
where the state can give the municipality a state facility to run;
however, it does not say the state can lease prison space from a
municipality, which is corrected in Section 2.
MR. DeWITT advised members that Sections 3 and 4 discuss pre-
approval of either a lease or a lease/purchase contract under the
codes that require the legislature to do that. He concluded, "That
takes an uncodified act by the legislature. So, that's why those
are not codified."
Number 0611
REPRESENTATIVE CROFT read: "The commissioner may not enter into an
agreement to provide necessary facilities under ...." He said the
word "under" seemed to be the crux of the matter. For example,
when it is under (a), it may or may not have an affect on soft
beds. But when it is under Sections 3 and 4, "these
lease/purchase, these private facilities", then they are being
clear on what they are conditioning. It seemed buttressed by the
fact that the title of Section 4 is "NOTICE AND APPROVAL OF LEASE-
PURCHASE AGREEMENT ...." He said they were "exactly providing for
that: more notice and more power to approve or disapprove."
REPRESENTATIVE CROFT said it was almost a conceptual/friendly
amendment. If there were a way - but he did not know that way - to
make it apply to sections of the bill, they would be sure they had
no unintended consequences. He added that he did not know whether
there were unintended consequences or not.
CHAIRMAN GREEN suggested on line 18, after the word "act" of
Amendment 3, adding, "nor does it apply to correctional facilities
of less than 100-bed capacity." He said that would take care of
anything except jails and prisons because no half-way houses are
that large.
An unidentified speaker disagreed, saying, "Yeah, they are."
Number 0680
REPRESENTATIVE CROFT said that made a lot of sense. Noting that
Representative Rokeberg had experience relating to alcohol
regulation issues, he said there are similar provisions for the
approval of a range for a new bar, for example, a change in an
existing license. So, it is certainly not an unheard-of provision
in areas where there are concerns about public safety.
Number 0730
REPRESENTATIVE BERKOWITZ agreed that if a friendly amendment would
differentiate between hard and soft beds, that would eliminate much
of the concern. He said essentially they were talking about hard-
bed facilities.
REPRESENTATIVE BUNDE said more than even hard beds, soft beds
should be subjected to community site selection because people can
and do walk away from facilities. As with a liquor license, he
thought Representative Rokeberg would have something to say about
a soft-bed facility located across the street from the Northwood
Elementary School. While he could not say definitely that this
would prohibit the building of soft beds, and did not want to do
that, he would support community site selection for soft beds as
well as hard beds.
Number 0803
REPRESENTATIVE ROKEBERG referred to public notification in
elections and stated that his knowledge was based on the
implementation of Title 21 in the Municipality of Anchorage.
There, when there is a zoning change or a conditional use such as
a liquor license, letters of information are sent to property
owners within a particular radius. The property owners have the
right to submit comments as to their approval or disapproval of the
zoning activity or platting board activity, for example. Only
registered property owners are allowed to comment on the activity
within a finite area. However, what is being contemplated here may
be a little more difficult because they may have to look at every
registered voter. He said he saw a large, almost-mechanical
problem. He said apparently Amendment 3 did not speak to who had
the authority to execute an election.
CHAIRMAN GREEN pointed out that it does.
REPRESENTATIVE ROKEBERG felt that the Municipality of Anchorage had
demonstrated the ability to react to the public will in terms of
site selection, and the assembly had the ability to deny any
construction or award of any project under the Planning and Zoning
Commission, as well as the issuance of a building permit. As he
saw it, the amendment was an unfunded mandate to an area to do
something that he believed they are capable of doing.
REPRESENTATIVE ROKEBERG suggested a friendly amendment, saying, "by
moving it out of that statutory thing, but also excluding the
words, `the municipal or', and taking it out of the municipalities,
and leaving it in areas that aren't even -- that don't have the
protections and safeguards that municipal governments have." He
said his biggest objection to the amendment is that he believes the
municipal governments in Alaska have adequate public hearing
processes in place to protect themselves. He noted that his own
district is near Chairman Green's, and the people share many of
those concerns.
Number 1000
REPRESENTATIVE JAMES said her concern with this amendment still had
not been addressed. She was trying to visualize the process to
establish a contract with somebody to build a prison. "This
doesn't provide any opportunity to ever get there," she stated.
She said she felt very sensitive about the issue of finding a
location. She had talked with Margot Knuth after the previous
hearing, and there are people who want a facility. She asked why
they were not focusing on that, which seemed to be the biggest
hurdle to obtaining more bed space.
REPRESENTATIVE JAMES suggested they could visualize an RFP going
out, with several bidders making an offer that would include a
location. She thought it might be sensible to state that if the
commissioner entered into an agreement, it would be subject to
approval of the location by the community or municipality, for
example. But she had a problem with saying the commissioner must
find a place before putting out an RFP, which she believes this
language says, because it limits land selection and requires
arrangements with the owners to determine whether the land can even
be procured.
REPRESENTATIVE JAMES emphasized that she agreed with the intent of
Amendment 3 but did not believe it was the right way to do it. She
offered to work with the Chairman to make it workable.
Number 1123
REPRESENTATIVE BUNDE pointed out that people in his district did
not share the confidence of some other Anchorage-area legislators
regarding the municipality's ability to deal fairly with its
citizens.
REPRESENTATIVE CROFT said in the school site-selection process, the
typical procedure involves selection from a number of different
locations. Bidders take options. They do not have to buy land,
put up a building and hope it is used, although that had happened
in Arizona.
REPRESENTATIVE CROFT explained, "You get an option on it. You put
your bid together. And they choose both the site and the project,
somewhat together. I don't think there's anything in this language
that prohibits that. In fact, it sorts of facilitates it. You
pick what would be the best site and then, if that site is selected
through an appropriate process, you pick it, and you confirm with
the people in the area that that's okay." The entire horizon can
be looked at, to find an area that really wants it.
Number 1204
REPRESENTATIVE BERKOWITZ said he read it differently. He believed
the commissioner could say she/he was looking for a place for a
prison and ask whether anyone had a good idea for a site. He said
that is what "initiates" means. "I don't see anything more
sinister than that in this language," he added.
CHAIRMAN GREEN agreed and said he could not see the restriction.
REPRESENTATIVE JAMES asked: If the commissioner had initiated a
site selection process, would property owners of various sites be
expected to come forward? Or would potential bidders be expected
to come forward with sites? After the commissioner selected a
site, the property owner would be very happy because his/her site
was selected. At that point, the commissioner would put out an RFP
for someone to build and operate a facility there. As
Representative James' understood the process, that property owner
would then really have a deal because of its increased value.
CHAIRMAN GREEN provided another scenario in which it is decided
that a 600-to-800-bed prison is needed. Notification would take
place and a number of site recommendations might be received, after
which the commissioner would eliminate sites for various reasons.
A decision then would be made as to whether the remaining sites
were workable.
REPRESENTATIVE JAMES said for a school or hospital, there would be
numerous offers. However, for a correctional facility, many sites
offered would be too far from town for people to be happy. She
believed the whole process would have to occur simultaneously,
including an opportunity for affected people to have a say.
Somehow, she would like to place the burden on the bidder to choose
a place that "meets the muster of the people."
REPRESENTATIVE JAMES acknowledged that she could be reading the
language wrong; it may not say that site selection occurs first.
However, she believed that unless the state plans to purchase any
property that they would select as a site, and unless the cost of
that property would be part of the selection process so that they
secured the property in that same action, they would be setting up
an unworkable situation. However, she did not believe they wanted
to say the state must buy or secure the land, either.
REPRESENTATIVE BUNDE said it would be necessary for him to leave
shortly because of a 3:00 p.m. commitment.
CHAIRMAN GREEN acknowledged Representative James's offer to work on
the amendment. He announced Amendment 3 would be kept "at bay."
Number 1502
CHAIRMAN GREEN brought before the committee Representative
Rokeberg's Amendment 4, 0-LS0194\K.37, Chenoweth, 3/14/97, which
read:
Page 1, lines 9 - 11:
Delete "a lease-purchase agreement or similar use-
purchase agreement for the design, construction, and operation
of a correctional facility, and setting conditions and
limitations on the facility's design, construction, and
operation"
Insert "lease-purchase agreements or similar use-purchase
agreements for the design, construction, and operation of
correctional facilities, and setting conditions and
limitations on the design, construction, and operation of
those facilities"
Page 4, line 31:
Delete "AGREEMENT"
Insert "AGREEMENTS"
Page 5, line 1:
Delete "AGREEMENT"
Insert "AGREEMENTS"
Page 5, line 4:
Delete "an agreement"
Insert "one or more agreements"
Following "AS 33.30.031,":
Insert "each to be"
Page 5, line 6:
Delete "a correctional facility"
Insert "one or more correctional facilities"
Page 5, line 11:
Delete "facility"
Insert "facilities that are approved by this section"
Page 5 line 12:
Delete "agreement"
Insert "agreements that are approved by this section"
Page 5, line 14:
Delete "agreement"
Insert "agreements"
Page 5, line 16, following "term of":
Delete "the"
Insert "a"
Page 5, line 18, following "(b)":
Delete "The"
Insert "A"
Page 5, line 21, following "male prisoners":
Insert "if only one correctional facility is designed and
constructed under the notice and approval given in (a) of this
section; however, if more than one correctional facility is
designed and constructed under the notice and approval given
in (a) of this section, at least one correctional facility
must be limited to confining female prisoners only"
Page 5, line 29:
Delete "The"
Insert "Each"
Page 6, line 17, following "operate":
Delete "the"
Insert "a"
Page 6, line 21, following "operation of":
Delete "the"
Insert "a"
Page 7, line 5:
Delete "a major correctional facility"
Insert "one or more major correctional facilities"
Page 7, line 7, following "job site of":
Delete "the"
Insert "a"
Page 7, lines 8 - 9:
Delete "the correctional facility described"
Insert "a correctional facility for which notice and
approval is given"
REPRESENTATIVE ROKEBERG directed members' attention to page 2, line
17, of Amendment 4, the insertion following "male prisoners" on
page 5, line 21 of the bill. He said this is the substance of the
amendment. It allows, under existing limits and caps of HB 53,
that if there was more than one facility constructed, one could be
a women's facility, which is needed in Alaska.
REPRESENTATIVE ROKEBERG said this is a plan he wants to see
implemented in Alaska. He noted that the Administration had
provided a one-page plan the previous week. He believed the state
needed a separate women's facility, and he knew that the people at
the Hiland-Meadow Creek area were concerned about changes to that
particular facility.
REPRESENTATIVE ROKEBERG said he believed there are adequate funds
to construct a 400-bed jail in some large municipal area in Alaska,
as well as a women's facility, anywhere it could be located, that
might fit within the bill. He said all his amendment did was
specify that if more than one facility were constructed under HB
53, it could be a women's facility. He said it did not bind
anybody's hands but provided flexibility and, perhaps, guidance.
Number 1680
REPRESENTATIVE MULDER advised members that the department had
brought forth, in the supplemental budget, a request to use $2.3
million to convert the Hiland facility into a women's facility and
to meet the Cleary requirements. He had spoken with Phil Volland,
attorney for the Cleary plaintiffs, and it was news to Mr. Volland
that the department could utilize the funds to make a settlement in
that regard.
REPRESENTATIVE MULDER pointed out that a women's facility had not
been a very large topic of discussion with Mr. Volland, the
plaintiffs and the department. He suggested the women's issue was
being brought forward more by the commissioner.
REPRESENTATIVE BERKOWITZ requested a rough estimate of numbers of
female prisoners and an estimate of the need. He also asked what
the commissioner had to say about it; he presumed the commissioner
would be in a better position to understand it than Mr. Volland.
REPRESENTATIVE ROKEBERG suggested others could answer the question
about numbers. He said while on the corrections subcommittee,
which had oversight of that budget and their operations for several
years, there had been indications about converting the Hiland
Mountain-Meadow Creek Correctional Center into a women's facility
for some time.
REPRESENTATIVE ROKEBERG mentioned his inspection of correctional
facilities around the state and said the Lemon Creek Correctional
Center in Juneau housed both female and male prisoners on an
"almost co-ed basis," which he found quite disturbing. He believed
the need for a women's facility in Alaska was paramount. Its total
effect, in terms of Cleary, was that any additional beds
constructed should take pressure off other facilities. He would
like to see one centralized women's facility, constructed in such
a way, and under this "privatize bill," that it does not create a
financial burden to the state and allows the state to meet its
responsibilities to those prisoners, as well as to meet any
responsibilities under Cleary. "And that's the only reason I
brought forward this amendment," he stated.
REPRESENTATIVE ROKEBERG guessed that there are 500 or 600 female
prisoners in the state, of which possibly 100 to 200 are hard-bed
prisoners.
Number 1918
REPRESENTATIVE BUNDE expressed understanding for the need for
adequate housing for female prisoners; however, he did not see
anything in the bill that predetermined that the private prison, if
built, would not be for women. He suggested if the demand was
there, the supply would occur. While this language may be
permissive, it strongly encourages that the commissioner take it as
legislative intent that the next private facility be for female
inmates. Representative Bunde believed the commissioner should be
able to decide what type of facility might best serve the needs of
the state. He pointed out that they did not know the exact
numbers.
CHAIRMAN GREEN suggested if Amendment 4 was put in statute and a
women's facility was built, the next time around, another women's
facility would have to be built. In effect, two of the next three
facilities could be women's facilities. Chairman Green was taking
into consideration the 8-percent-growth factor of prisoners
annually.
REPRESENTATIVE ROKEBERG affirmed that. If more than one prison
could be built under the authorization provided in HB 53, he wanted
it to be a women's prison. He said he had just been handed some
figures. As of March 12, 1997, there were 106 sentenced female
prisoners and 108 unsentenced female inmates in the system. He
said the necessity of keeping that facility near the majority of
judicial activity seemed apparent. With respect to Representative
Bunde's comment that this is a policy statement, Representative
Rokeberg said that is certainly his intent.
CHAIRMAN GREEN said while he could subscribe to the policy intent,
nothing in the bill precludes building the next prison for females.
It just allows a prison to be built, without specifying location or
gender. However, when put in statute, it would last and last. If
a women's prison were built and later it was decided that two new
prisons were needed in Alaska, Amendment 4 would require one of the
next two to also be for females. He asked, "Is that what we really
want to do in statute?"
REPRESENTATIVE ROKEBERG stated his understanding that the
legislation was noncodified statutory authority to proceed under
the caps indicated. He asked the sponsor for clarification,
specifically asking whether what was being done was authorizing a
cap of $150 million and up to 800 or 1,000 prisoners.
REPRESENTATIVE MULDER responded that they were authorizing one
facility, "a" new facility
REPRESENTATIVE ROKEBERG said they could not possibly build more
than one or two facilities under the caps specified.
CHAIRMAN GREEN asked whether there would be a repealer at some
point down the road, since it would be in statute.
REPRESENTATIVE CROFT said he was not yet sure what he thought about
the women's prison issue; however, he was happy to see
Representative Rokeberg's amendment in the other areas. It had
disturbed him for awhile that the bill specified "a" facility. He
stated, "Even if I worry that this may not be the proper area for
market competition, at least it should be that, right? If that's
the proposal."
REPRESENTATIVE CROFT suggested dividing the question.
TAPE 97-40, SIDE A
Number 0006
REPRESENTATIVE CROFT proposed separating the question into
Amendment 4-A, being everything but the women's issue, and
Amendment 4-B, being page 2, lines 16 through 20, the insertion
following "male prisoners". He commented that he had not heard
enough on the women's prison issue. However, he believed he had
heard enough about whether it should be multiple facilities that he
knew his feelings about that.
CHAIRMAN GREEN expressed concern that while the sponsor said this
is "a" prison, page 1, lines 1 and 2 of the bill said, "to contract
for facilities". Chairman Green read that to mean more than one
prison.
MR. DeWITT directed members' attention to Section 1, which would
amend AS 33.30.031(a), and said that deals with procurement of a
host of correctional facilities. He believed that was why the
title refers to the word in plural in that particular instance. He
suggested that looking through the entire bill, it is clearly the
intent, the way the bill is drafted, that whatever form of
financing is used, they are talking only about one facility.
CHAIRMAN GREEN pointed out that he saw the word "facilities" on a
number of pages of the bill.
MR. DeWITT explained that page 2 deals with how the department
procures services of nondepartmental correctional services, such as
half-way houses; that is plural because there are contracts with
several. Beginning with Section 3, particularly on page 4,
starting at line 26, it says, "The Department [of Corrections] may
not, under this section, enter into an agreement to lease space for
the use of space in a correctional facility if, under sec. 4 of
this Act, the Department of Administration, on behalf of the
Department of Corrections, enters into a lease-purchase agreement,
use-purchase agreement, or other agreement to use a facility that
has a nominal purchase option." Mr. DeWitt said following through
Section 4, members would find the singular use. He then referred
to page 6, line 28, and said that language essentially says "that
if they use this section, you can't use Section 3."
Number 0385
REPRESENTATIVE MULDER said it was clearly his intention that it be
singular. He said to the extent that they look at all these
amendments, they were more-or-less "dancing on the head of a pin".
He believed the commissioner already had statutory authority to
enter into an agreement with a private contractor, as the
commissioner had done with the state of Arizona.
REPRESENTATIVE MULDER explained, "I just wanted to make certain
that we codified those arrangements for in-state contracts, in law,
and that the main purpose or focus of this bill was to pre-
authorize that arrangement or that agreement." He said to the
extent that they put binders on it, they were making a pretty
simple concept into what is now a seven-page bill, soon to be twice
that size.
REPRESENTATIVE JAMES responded that on that point, her
understanding was that the bill was to establish a privately-built
facility where part of the contract would include operation of the
facility. She agreed that if the commissioner could contract with
Arizona, she also could contract with a state facility. The
commissioner had the ability to put a prisoner, or prisoners, into
someone else's facility.
REPRESENTATIVE JAMES stated, "We don't have, or probably wouldn't
have, that opportunity to do that in this state without a piece of
legislation that would indicate that that is a possibility." She
asked whether the bill restricts any RFP for construction of a
facility to also including the operation of the facility.
REPRESENTATIVE JAMES pointed out that she had been vocal for a long
time on "managed competition," as opposed to having a monopoly
within the state. With managed competition, operation of the
facility would go out to bid and the agency could bid also. She
believes that is one of the best ways to "kind of edge ourselves
into privatization." She asked whether this bill allows that to
happen or whether it specifies that it must be done in a package.
REPRESENTATIVE MULDER responded that the issue they were discussing
was called "bundling." For the first five years, yes, construction
and operation would be "bundled" together; after that period, they
would be "unbundled."
REPRESENTATIVE JAMES concluded that this, then, is different from
what the Administration is currently operating under. Bundling is
not available under current statute or the current ability of the
Administration.
Number 0580
REPRESENTATIVE MULDER responded that in his conversations with Jack
Chenoweth, Legislative Legal Counsel, Mr. Chenoweth believed that
the commissioner has that ability today.
REPRESENTATIVE JAMES asked, "Then why don't we have a piece of
legislation that refers to bundling, as an option?"
REPRESENTATIVE MULDER replied that bundling is in this bill.
REPRESENTATIVE JAMES said she believed it is easier to sell
bundling than building a private prison.
REPRESENTATIVE MULDER replied, "But I think they're integrally tied
in this sense. We simply specified, within this bill, that they
are bundled for the first five years, for a reason. And that was
that if you take Spring Creek, for example, it was designed by
people who didn't have to be there afterwards." He said those now
operating that facility do not like the way it was built or
designed. One who takes something from inception to operation will
be far more sensitive about the functionality of that facility.
"You're going to make it work, and you're going to make it work
efficiently and effectively, in order to meet your bid," he stated,
"because if you don't, you lose money on the deal. So, you're
going to be very sensitive about what works and what doesn't work."
He said this is not a new concept, practice or program.
REPRESENTATIVE JAMES said that certainly had merit. She noted that
they had not heard that specific argument or statement before.
Number 0744
REPRESENTATIVE ROKEBERG noted that the bundling clause is
subsection (2)(A) of the bill, page 6, lines 10 through 12.
REPRESENTATIVE MULDER confirmed that.
REPRESENTATIVE ROKEBERG said his intention with Amendment 4 was to
ask for a women's facility, underneath the structure of the bill,
and Mr. Chenoweth had provided language to accomplish that. He
took exception to dividing the question, saying there was a policy
question, but stated that he would be happy to abide by the wishes
of the committee.
CHAIRMAN GREEN asked: If HB 53 only addresses one prison, is
Amendment 4 applicable?
Number 0852
REPRESENTATIVE ROKEBERG said yes. If the Department of Corrections
decided to build more than one facility under HB 53, for example,
a jail and a women's facility in an unnamed area, they could if
adequate funding was available. That was his intention.
REPRESENTATIVE BUNDE pointed out that if they were building one
prison, and if Amendment 4 passed, it would be a women's prison.
If they were building more than one, the bill would have to be
rewritten. He questioned how they could attach Amendment 4, which
discussed additional prisons, to a bill that specified one
facility.
Number 0950
CHAIRMAN GREEN asked: If there was $150 million, and if the
decision was to build a jail rather than a prison, would they be
staying within the purview of the bill? Chairman Green asked
whether the department could say that what they really wanted was
the money, and if secured, they could build a prison for males and
also have funds available to build a prison for females.
REPRESENTATIVE ROKEBERG referred to Margot Knuth's previous
testimony regarding a jail in Anchorage that would be a "stick-
built" costing $60 million. Referring to page 5, line 11, he said
the construction cost is $90 million. He felt it was simple logic
that if one facility could be built for $60 million, a women's
facility could be built with the remaining $30 million. He asked
to hear from the sponsor about that.
Number 1010
REPRESENTATIVE BUNDE understood there were varying amounts;
however, they needed to decide whether this was for a single
prison. He said if they could amend HB 53 to allow for more than
one facility, he would support Amendment 4. However, if they
decided it only allowed one prison, he did not understand the
amendment.
REPRESENTATIVE BERKOWITZ said they were operating on a presumption
that the state would hire a general contractor to produce one
facility. However, if they incorporated plural language, they
could be in a situation where the state behaved like the general
contractor and directed two or more entities to construct the
various parts of the facility. He noted that it would require
dividing the question on Amendment 4.
Number 1071
REPRESENTATIVE JAMES referred to earlier testimony of the sponsor
and testimony of Margot Knuth relating to extensions of existing
facilities. Even though the bill includes bundling, Representative
James could not imagine them building and operating an extension.
Therefore, she believed they would have to operate the whole
facility. With the exception of the Anchorage jail, which would be
a new facility, she did not see an option for getting two
facilities, even if it specified two, for under $90 million. She
said whether or not the bill was amended to allow for more than one
facility, and whether or not a second facility would be a women's
facility, it needed to be consistent in some way.
REPRESENTATIVE JAMES agreed with Representative Bunde that if
members accepted Representative Rokeberg's amendment, they would
have to provide for the capability of more than one facility.
However, she did not think the intent of HB 53, with the economies
of scale being the driving factor, as well as the construction
design of the facility, would allow an extension of an existing
facility.
REPRESENTATIVE ROKEBERG said given the conversation and testimony
on Amendment 4, and if the sponsor felt the amendment confused the
bill further, he would withdraw Amendment 4.
REPRESENTATIVE ROKEBERG pointed out that page 5 of the bill, lines
20 and 21, says, "(1) must be designed and constructed so as to
house, in separate housing, female prisoners and male prisoners".
He hoped members were now more aware of the need for a women's
facility in the state. He then withdrew Amendment 4.
CHAIRMAN GREEN acknowledged that Representative Rokeberg had a
reason for offering Amendment 4, there was a concern, and he
withdrew it. He noted that there was also concern over the site
selection process. He asked whether Representative Rokeberg saw
merit in placing those into a subcommittee to attempt to come up
with usable language. He further asked whether Representative
Rokeberg maintained his withdrawal of Amendment 4.
REPRESENTATIVE ROKEBERG replied that he supported the bill and did
not want to be a party to anything that would distract from it or
help sink it. If the amendments were placed in subcommittee, he
requested that the sponsor be included.
CHAIRMAN GREEN announced that they would continue working the bill
with the other amendments. However, he was assigning a
subcommittee consisting of Representatives James, Croft and himself
to consider Amendments 3 and 4. He asked that Representative James
chair that subcommittee.
REPRESENTATIVE JAMES agreed.
CHAIRMAN GREEN advised members that HB 53 would be heard again the
following Monday.
Number 1418
ADJOURNMENT
CHAIRMAN GREEN adjourned the House Judiciary Standing Committee
meeting at 3:02 p.m.
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