Legislature(2001 - 2002)

03/05/2002 03:22 PM MLV

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
            HOUSE SPECIAL COMMITTEE ON MILITARY AND                                                                           
                       VETERANS' AFFAIRS                                                                                      
                         March 5, 2002                                                                                          
                           3:22 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Mike Chenault, Chair                                                                                             
Representative Lisa Murkowski                                                                                                   
Representative Joe Green                                                                                                        
Representative Joe Hayes                                                                                                        
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Beverly Masek                                                                                                    
Representative Pete Kott                                                                                                        
Representative Sharon Cissna                                                                                                    
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 371                                                                                                              
"An  Act establishing  the  Alaska  veterans' memorial  endowment                                                               
fund  and  providing  for  credits   against  certain  taxes  for                                                               
contributions to  that fund;  relating to  other tax  credits for                                                               
certain contributions; and providing for an effective date."                                                                    
                                                                                                                                
     - HEARD AND HELD                                                                                                           
                                                                                                                                
HOUSE BILL NO. 324                                                                                                              
"An Act making supplemental and other appropriations for                                                                        
homeland security; and providing for an effective date."                                                                        
                                                                                                                                
     - HEARD AND HELD                                                                                                           
                                                                                                                                
PREVIOUS ACTION                                                                                                               
                                                                                                                                
BILL: HB 371                                                                                                                  
SHORT TITLE:ALASKA VETERANS' MEM.ENDOWMENT FUND                                                                                 
SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR                                                                                      
                                                                                                                                
Jrn-Date   Jrn-Page                     Action                                                                                  
02/01/02     2119       (H)        READ THE FIRST TIME -                                                                        
                                   REFERRALS                                                                                    
02/01/02     2119       (H)        MLV, STA, FIN                                                                                
02/01/02     2119       (H)        FN1: INDETERMINATE(CED)                                                                      
02/01/02     2119       (H)        FN2: INDETERMINATE(REV)                                                                      
02/01/02     2119       (H)        FN3: (MVA)                                                                                   
02/01/02     2119       (H)        GOVERNOR'S TRANSMITTAL LETTER                                                                
03/05/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
                                                                                                                                
BILL: HB 324                                                                                                                  
SHORT TITLE:HOMELAND SECURITY APPROPRIATIONS                                                                                    
SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR                                                                                      
                                                                                                                                
Jrn-Date   Jrn-Page                     Action                                                                                  
01/16/02     1972       (H)        READ THE FIRST TIME -                                                                        
                                   REFERRALS                                                                                    
01/16/02     1972       (H)        MLV, STA, FIN                                                                                
01/16/02     1972       (H)        GOVERNOR'S TRANSMITTAL LETTER                                                                
01/16/02     1972       (H)        SPREADSHEET BY DEPT. COST                                                                    
02/12/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
02/12/02                (H)        Heard & Held                                                                                 
02/12/02                (H)        MINUTE(MLV)                                                                                  
02/19/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
02/19/02                (H)        Heard & Held                                                                                 
02/19/02                (H)        MINUTE(MLV)                                                                                  
02/21/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
02/21/02                (H)        Heard & Held                                                                                 
02/21/02                (H)        MINUTE(MLV)                                                                                  
02/26/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
02/26/02                (H)        Heard & Held                                                                                 
02/26/02                (H)        MINUTE(MLV)                                                                                  
02/28/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
02/28/02                (H)        -- Meeting Canceled --                                                                       
03/05/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
CAROL CARROLL, Director                                                                                                         
Central Office                                                                                                                  
Administrative Services Division                                                                                                
Department of Military & Veterans' Affairs                                                                                      
400 Willoughby Avenue, Suite 500                                                                                                
Juneau, Alaska 99811                                                                                                            
POSITION STATEMENT:  Presented HB 371.                                                                                          
                                                                                                                                
PAT CAROTHERS, Chair                                                                                                            
Alaska Veterans Advisory Council (AVAC)                                                                                         
P.O. Box 32926                                                                                                                  
Juneau, Alaska  99803-2926                                                                                                      
POSITION STATEMENT:  Answered questions and expressed support                                                                   
for HB 371.                                                                                                                     
                                                                                                                                
CHUCK HARLAMERT, Juneau Section Chief                                                                                           
Central Office                                                                                                                  
Tax Division                                                                                                                    
Department of Revenue                                                                                                           
PO Box 110420                                                                                                                   
Juneau, Alaska  99811-0420                                                                                                      
POSITION  STATEMENT:    Testified  on  the  tax  implications  of                                                               
HB 371.                                                                                                                         
                                                                                                                                
JOHN JENKS, Chief Investment Officer                                                                                            
Treasury Division                                                                                                               
Department of Revenue                                                                                                           
PO Box 110405                                                                                                                   
Juneau, Alaska  99811-0405                                                                                                      
POSITION STATEMENT:  Answered questions on HB 371.                                                                              
                                                                                                                                
MIKE CONWAY, Director                                                                                                           
Division of Statewide Public Service                                                                                            
Department of Environmental Conservation                                                                                        
410 Willoughby Avenue, Suite 303                                                                                                
Juneau, Alaska  99801-1795                                                                                                      
POSITION  STATEMENT:   Testified  on  HB  324  on behalf  of  the                                                               
department.                                                                                                                     
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 02-14, SIDE A                                                                                                              
Number 0001                                                                                                                     
                                                                                                                                
CHAIR  MIKE  CHENAULT  called  the  House  Special  Committee  on                                                               
Military  and Veterans'  Affairs meeting  to order  at 3:22  p.m.                                                               
Representatives  Chenault,  Murkowski,   Green,  and  Hayes  were                                                               
present at the call to order.                                                                                                   
                                                                                                                                
HB 371-ALASKA VETERANS' MEM.ENDOWMENT FUND                                                                                    
                                                                                                                                
CHAIR CHENAULT announced the first  order of business, HOUSE BILL                                                               
NO.  371,  "An Act  establishing  the  Alaska veterans'  memorial                                                               
endowment fund  and providing for  credits against  certain taxes                                                               
for contributions  to that  fund; relating  to other  tax credits                                                               
for certain contributions; and providing for an effective date."                                                                
                                                                                                                                
Number 0167                                                                                                                     
                                                                                                                                
CAROL CARROLL, Director,  Central Office, Administrative Services                                                               
Division, Department  of Military  & Veterans'  Affairs, informed                                                               
the committee  that the  bill would  indeed establish  the Alaska                                                               
veterans'  memorial  endowment fund.    The  purpose is  to  have                                                               
income from  that fund  maintain the  monuments and  memorials to                                                               
veterans and the military around the  state.  She noted that some                                                               
memorials  are in  pretty bad  shape; in  the past,  the veterans                                                               
themselves have volunteered their time  to keep up the memorials.                                                               
She pointed  out that  already $125,000  has been  collected from                                                               
members of the Alaskan community.                                                                                               
                                                                                                                                
Number 0246                                                                                                                     
                                                                                                                                
MS. CARROLL explained  that the fiscal note is  for an additional                                                               
$125,000 for  the state "match" to  get some seed money  into the                                                               
endowment fund.   She reported  that businesses would be  able to                                                               
get a tax  credit for any donations given to  the fund, but there                                                               
are  some limitations  on that.   She  referred to  the sectional                                                               
analysis which  describes what  the tax  credit is  and indicated                                                               
that  someone  from  the  Department   of  Revenue  could  answer                                                               
questions on the tax credit portion of the bill.                                                                                
                                                                                                                                
Number 0303                                                                                                                     
                                                                                                                                
MS. CARROLL  informed members that  Section 4 is  the description                                                               
of the fund  that would be managed by the  Department of Revenue.                                                               
The Department  of Revenue  would determine  the income  off that                                                               
and would be allocated to  the Department of Military & Veterans'                                                               
Affairs by the  legislature.  From that point  on, the department                                                               
would work  with veterans groups to  grant money to them  for the                                                               
maintenance or construction of military monuments and memorials.                                                                
                                                                                                                                
Number 0367                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI  said she understands from  talking with                                                               
[Major General  Oates, Adjutant  General/Commissioner, Department                                                               
of Military and Veterans' Affairs]  and some of the veterans that                                                               
there is no  state money that currently  goes towards maintenance                                                               
of  any  of  the  memorials.     The  memorials  have  only  been                                                               
maintained  through  volunteer  efforts.    She  asked  how  many                                                               
veterans' memorials there are in the state.                                                                                     
                                                                                                                                
Number 0458                                                                                                                     
                                                                                                                                
PAT CAROTHERS,  Chair, Alaska  Veterans Advisory  Council (AVAC),                                                               
replied that there are  78 right now.  He said  there will be one                                                               
more with promised funds.                                                                                                       
                                                                                                                                
Number 0516                                                                                                                     
                                                                                                                                
MR. CAROTHERS reported that in  his experience with administering                                                               
the Archie Van  Winkle memorial fund, there was  $2,000 left over                                                               
from the  construction and building of  that particular memorial.                                                               
He reported  that the veterans  have repaired  it, professionally                                                               
cleaned it,  and put in  benches and  trees, and that's  all been                                                               
done with the  interest of the $2,000.  He  told members there is                                                               
no question  in his mind that  with $250,000, up to  90 different                                                               
memorials could be supported.   He noted that there are different                                                               
kinds  of memorials.    Several are  memorial  highways -  DOT/PF                                                               
[Department of Transportation &  Public Facilities] takes care of                                                               
them anyway - and some are a plaque on a bridge.                                                                                
                                                                                                                                
Number 0606                                                                                                                     
                                                                                                                                
MR.  CAROTHERS  stated  that the  largest  expenditures  will  be                                                               
replacement  of  the  memorials.    This  bill  will  afford  the                                                               
opportunity to  maintain these memorials  in a  dignified manner,                                                               
and one  the veterans richly  deserve.  He acknowledged  that the                                                               
veterans who  are commemorated  did much  to honor  this country;                                                               
they  bled and  died for  this country  and for  this state.   He                                                               
affirmed that  other than Pearl  Harbor, the only medal  of honor                                                               
awarded for action in the United  States was in Adak, Alaska, PFC                                                               
[Private First  Class] Martinez.   He offered that what  is being                                                               
asked  for is  a  means  in which  to  honorably recognize  those                                                               
heroic efforts that these memorials recognize.  He said:                                                                        
                                                                                                                                
     Places  of  remembrance need  to  be  maintained.   For                                                                    
     [Alaskan]  veterans who  took care  of Americans,  it's                                                                    
     high time  we took care of  them.  Now the  public has,                                                                    
     through private  contributions, ... put their  money up                                                                    
     -  $125,000.   We're  asking for  $125,000 in  matching                                                                    
     funds, ...  and we will  live off that  interest, which                                                                    
     will  come  out  to  about  $12,000  a  year.  ...  I'm                                                                    
     completely  satisfied   that  we  can   maintain  these                                                                    
     memorials in an  honorable way by using  these funds in                                                                    
     that manner.                                                                                                               
                                                                                                                                
MR. CAROTHERS introduced  Joe [Sadlier], a World  War II veteran,                                                               
who was  one of  those who brought  LST-325 [Landing  Ship, Tank]                                                               
across the  Atlantic Ocean from Greece  to Mississippi.  He  is a                                                               
native of Juneau and now lives in Ketchikan.                                                                                    
                                                                                                                                
Number 0830                                                                                                                     
                                                                                                                                
CHAIR CHENAULT asked Mr. Carothers  if he felt the maintenance on                                                               
these memorials could be done on this money.                                                                                    
                                                                                                                                
MR. CAROTHERS  replied that he  is thoroughly convinced  of that,                                                               
especially  with  his  experience  on  the  [Archie  Van  Winkle]                                                               
memorial  in  town.    He  noted there  are  other  memorials  in                                                               
[Juneau]  that haven't  been  touched.   The  USS [United  States                                                               
Ship] Juneau [memorial]  brass plaque, with the names  of all who                                                               
perished in  that, hasn't  been shined or  cleaned since  [it was                                                               
put in].   He commented  that there  is no committee  behind that                                                               
one,  and that's  what can  happen.   He said  he thinks  that it                                                               
would be dishonoring  [those veterans] if this  [bill] doesn't go                                                               
through.  He urged the committee to pass on [HB 371].                                                                           
                                                                                                                                
Number 0990                                                                                                                     
                                                                                                                                
CHAIR CHENAULT asked about the  tax implications for corporations                                                               
and what  may or may  not be  deductible or allowable  under this                                                               
current  bill.   He referred  to the  paragraph in  the sectional                                                               
analysis that talks  about Sections 2, 6, 8, 10,  12, 14, and 16,                                                               
the parallel sections  dealing with oil and  gas production taxes                                                               
and pipeline  transportation property taxes, and  he wondered how                                                               
that would work.                                                                                                                
                                                                                                                                
Number 1070                                                                                                                     
                                                                                                                                
CHUCK  HARLAMERT,  Juneau  Section  Chief,  Central  Office,  Tax                                                               
Division,  Department  of  Revenue,  explained  that  the  credit                                                               
allows  a combined  credit,  no  matter what  tax  it is  applied                                                               
against,  up to  $150,000  a  calendar year.    Similar to  other                                                               
current  education tax  credits, taxpayers  can choose  which tax                                                               
liability they  are liable for  to apply  it against.   The taxes                                                               
involved are  insurance premium taxes, corporate  income tax, oil                                                               
and gas  severance tax,  and oil and  gas property  taxes, mining                                                               
license tax,  fisheries business  tax, and the  fisheries landing                                                               
tax.                                                                                                                            
                                                                                                                                
Number 1140                                                                                                                     
                                                                                                                                
MR. HARLAMERT explained that they  would get a credit against the                                                               
state tax  liability and  a net deduction  on the  federal return                                                               
for their contribution, less the amount of the state tax credit.                                                                
                                                                                                                                
Number 1162                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI referred  to Section 17 and  said she is                                                               
trying  to   understand  how  the   amounts  are   available  for                                                               
appropriation.   She  asked if  the 5-percent  payout is  for the                                                               
succeeding years or just in the first year.                                                                                     
                                                                                                                                
Number 1260                                                                                                                     
                                                                                                                                
JOHN   JENKS,  Chief   Investment  Officer,   Treasury  Division,                                                               
Department of Revenue, said that  the investment features of this                                                               
bill  set  out instruction  for  the  department to  invest  this                                                               
endowment  to earn  5  percent  after inflation  over  time.   If                                                               
inflation is 3 percent, he said  the endowment would be trying to                                                               
earn  8 percent.    There is  explicit  instruction to  inflation                                                               
proof this  endowment so that  ten years from now,  Mr. Carothers                                                               
will have  the same  economic power  to maintain  those monuments                                                               
that he has today.  The  transitional language says it will build                                                               
up to  that three years.   The first fiscal year  starts out with                                                               
the monthly market  values and then it builds  to that three-year                                                               
rolling average.  He explained  that the three-year average is in                                                               
there to provide  some "smoothing."  Markets go up  and down, and                                                               
over time this  will smooth things out so that  the veterans will                                                               
have a  fairly stable expectation  of how much  resources they'll                                                               
have year to year  by having a stable payout over  time - that is                                                               
5 percent of the average market value of the endowment.                                                                         
                                                                                                                                
REPRESENTATIVE  MURKOWSKI said  her question  was whether  or not                                                               
the 5 percent of the market value is what it is capped at.                                                                      
                                                                                                                                
MR. JENKS said yes.                                                                                                             
                                                                                                                                
Number 1360                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI  asked  what he  anticipated  would  be                                                               
available to Mr. Carothers and his group on an annual basis.                                                                    
                                                                                                                                
MR.  JENKS   replied  that   approximately  $12,500   in  current                                                               
purchasing power  each year would  be available.  A  great market                                                               
could certainly grow it, or if  people donate to the fund and the                                                               
fund gets bigger because of  that, then that money would increase                                                               
as  a result  of  the  subsequent donations.    For the  original                                                               
$250,000, he  indicated that he  doesn't anticipate  that growing                                                               
to some large amount.                                                                                                           
                                                                                                                                
Number 1433                                                                                                                     
                                                                                                                                
CHAIR  CHENAULT  asked   if  this  was  modeled   after  the  PFD                                                               
[permanent fund dividend].                                                                                                      
                                                                                                                                
MR. JENKS  replied that this  legislation is really  very typical                                                               
of  current  endowment  language  used by  individuals  or  other                                                               
states.   He  agreed that  it's  thought to  be the  best way  to                                                               
provide for the  most efficient investment and  stable payout for                                                               
these endowments.                                                                                                               
                                                                                                                                
Number 1470                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI asked  how  many  other endowments  the                                                               
Department of Revenue manages.                                                                                                  
                                                                                                                                
MR.  JENKS  answered  that  this  would  be  the  sixth  specific                                                               
endowment  managed by  the department.   He  explained that  this                                                               
language  is  the model  language.    Something similar  to  this                                                               
language was used for the  power cost equalization fund, which is                                                               
thought  of as  an endowment  also.   In reply  to a  question by                                                               
Representative  Murkowski, he  answered  that  because there  are                                                               
these endowments and the other  funds managed by the state, there                                                               
is  a real  scale of  efficiency  that allows  the department  to                                                               
invest these  very efficiently, yet  still have the  liquidity to                                                               
provide  on an  annual basis  for the  payout, so  it works  very                                                               
well.                                                                                                                           
                                                                                                                                
Number 1565                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GREEN  asked  if   the  other  five  [endowments]                                                               
averaged in the 8-plus percent [interest] in the last two years.                                                                
                                                                                                                                
MR. JENKS answered  that they have done fairly  well, and several                                                               
of the other endowments don't have  this language.  He noted that                                                               
Senator  Therriault has  sponsored  some  legislation that  would                                                               
change the "rules of the road"  as they're set out in statute for                                                               
investment of  the children's  trust and  public school  trust to                                                               
make  them  as  efficient  as  this.   Over  time,  he  said  the                                                               
department thinks this endowment,  absent that bill becoming law,                                                               
would actually achieve superior  long-term returns because of the                                                               
flexibility incorporated here.                                                                                                  
                                                                                                                                
Number 1625                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI asked  if the  people who  have already                                                               
donated to the  fund will be able to avail  themselves of the tax                                                               
credits that are being talked about.                                                                                            
                                                                                                                                
MR.  HARLAMERT replied  that no,  the contributions  were already                                                               
made.   In  order to  qualify  for the  credit, the  contributors                                                               
would have to be made in a  year in which the bill was effective.                                                               
He responded  to an earlier  question of how much  could possibly                                                               
accumulate.    He explained  that  in  the Alaska  education  tax                                                               
credit program,  the taxpayer only  gets 50 percent of  the first                                                               
$100,000 as a credit, but 100  percent of the second $100,000, so                                                               
people  tend  to contribute  the  entire  $200,000 for  the  full                                                               
150,000 credit.  At least 90  percent of all the tax credits they                                                               
get in  terms of dollars are  "maxed out" at the  $150,000 level.                                                               
It's  a very  tight-knit  group  of taxpayers  who  tend to  have                                                               
strong  charitable  giving  programs  in their  own  right.    He                                                               
implied it  was likely that the  fund, if it grows,  will grow in                                                               
substantial steps, $150,000 at a "pop."                                                                                         
                                                                                                                                
CHAIR  CHENAULT commented  that this  is set  up more  for bigger                                                               
contributors than for people like himself.                                                                                      
                                                                                                                                
Number 1744                                                                                                                     
                                                                                                                                
CHAIR CHENAULT announced that HB 371 would be held over.                                                                        
                                                                                                                                
HB 324-HOMELAND SECURITY APPROPRIATIONS                                                                                       
                                                                                                                                
[Contains testimony on HB 51]                                                                                                   
                                                                                                                                
Number 1774                                                                                                                     
                                                                                                                                
CHAIR CHENAULT announced the final  order of business, HOUSE BILL                                                               
NO.  324, "An  Act making  supplemental and  other appropriations                                                               
for homeland security; and providing for an effective date."                                                                    
                                                                                                                                
CHAIR  CHENAULT informed  participants that  the committee  would                                                               
consider Items 23-28 [of the  document "Terrorism Disaster Policy                                                               
Cabinet:   Cost Estimates  for Highest  Priority Recommendation,"                                                               
dated  1/14/02], which  is for  the  Department of  Environmental                                                               
Conservation.                                                                                                                   
                                                                                                                                
Number 1802                                                                                                                     
                                                                                                                                
MIKE  CONWAY, Director,  Division  of  Statewide Public  Service,                                                               
Department of Environmental  Conservation (DEC), informed members                                                               
that  he'd   provided  a  copy   of  a  summary  sheet   for  the                                                               
Environmental Health Laboratory.  That  is an item not listed for                                                               
funding from  HB 324; it's  listed there as a  critical component                                                               
of  the homeland  security net.   He  said he  believes that  the                                                               
Department  of  Health &  Social  Services  has other  laboratory                                                               
items  under its  items.   The  Environmental Health  Laboratory,                                                               
however,  is  sitting  in  HB  51  and  is  before  both  finance                                                               
committees  as  a  bonding  measure  based  upon  its  standalone                                                               
merits.  He explained that  there's a breakdown, so the committee                                                               
can see the functions of the laboratory.                                                                                        
                                                                                                                                
MR. CONWAY  said [the  laboratory] has  a peacetime  mission that                                                               
also carries over  in the event of a weapons  of mass destruction                                                               
attack,  in which  the department  would have  the capability  to                                                               
look at  the food and  water sources and  know if there  had been                                                               
any contamination.   Since September  11 [2001  terrorist attacks                                                               
on the  East Coast], water  contamination is not just  limited to                                                               
those  kinds of  attacks.    He informed  the  members there's  a                                                               
pending case  against somebody who  has threatened  the Anchorage                                                               
water   supply   system   going  through   criminal   proceedings                                                               
currently.   He also  reported there  was a  case in  The Dalles,                                                               
Oregon several years  ago in which 751 people were  made sick.  A                                                               
group was  trying to affect  a local election and  contaminated a                                                               
salad bar so people wouldn't make it out for the election.                                                                      
                                                                                                                                
MR.  CONWAY noted  that other  peacetime missions  the department                                                               
has been involved in include  testing food when tourists on buses                                                               
have gotten  sick, testing shellfish for  different diseases, and                                                               
performing  dairy inspections  that  allows Alaska's  milk to  be                                                               
sold commercially to the military, for instance.                                                                                
                                                                                                                                
Number 1967                                                                                                                     
                                                                                                                                
CHAIR  CHENAULT  referred to  Item  25  ["Increase DEC  emergency                                                               
alert status  to 24  hours per day  with six  additional response                                                               
corps staff"] and asked for a rundown on it.                                                                                    
                                                                                                                                
MR. CONWAY explained that the  six positions and 24-hour response                                                               
capability is  not associated with  the laboratory, but  would be                                                               
part  of  DEC's Division  of  Spill  Prevention and  Response  to                                                               
augment  the  existing staff  and  capabilities  for response  to                                                               
hazardous  materials incidences  and  spills.   These six  people                                                               
would work with communities around  the state, the DEC, and other                                                               
agencies in preparedness  for a capability to  respond to weapons                                                               
of mass  destruction incidences.  Currently,  he explained, there                                                               
is  a peacetime  function for  oil  and substances  spills.   The                                                               
resources presently available are dedicated  to doing that at the                                                               
current level  of activities.   He  indicated that  new expertise                                                               
and new  equipment are needed to  address the idea of  weapons of                                                               
mass destruction.                                                                                                               
                                                                                                                                
Number 2108                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GREEN asked  about the  $100,000 for  fiscal year                                                               
2003.                                                                                                                           
                                                                                                                                
MR.  CONWAY replied  that the  $100,000  is a  one-time cost  for                                                               
equipping and  training the whole  group.  The other  amounts are                                                               
for the personal  services for the staff.  The  first $250,000 is                                                               
for the remaining fiscal year.   If the supplemental is approved,                                                               
the $600,000 is the ongoing annual amount.                                                                                      
                                                                                                                                
REPRESENTATIVE GREEN said that's $100,000 per person.                                                                           
                                                                                                                                
MR. CONWAY answered  that $100,000 per responder  is typical when                                                               
looking at the salaries, equipment, and training.                                                                               
                                                                                                                                
Number 2160                                                                                                                     
                                                                                                                                
MR. CONWAY  replied to Representative Green's  question that [the                                                               
staff]  are   environmental  specialists.    He   explained  that                                                               
$100,000 is  the current  rate now for  oil spill  responders and                                                               
hazardous  chemical responders.   To  maintain the  capability to                                                               
operate the  equipment, there is continual  training required for                                                               
different levels of "HAZMAT"  [hazardous materials] response, and                                                               
that's the going rate.                                                                                                          
                                                                                                                                
Number 2190                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN asked what they do in between threats.                                                                     
                                                                                                                                
MR.  CONWAY answered  that they  are responding  to spills  right                                                               
now.   The  group being  asked  for [in  Item 25]  are not  doing                                                               
anything  with weapons  of mass  destruction.   This  is done  in                                                               
anticipation of those attacks.   The existing group of responders                                                               
are  responding to  spills.   He  reported that  there are  about                                                               
2,500 spills  reported a  year; within that,  there is  a ranking                                                               
and an assessment process on the spills responded to.                                                                           
                                                                                                                                
MR. CONWAY clarified  that the people being asked for  in Item 25                                                               
will be dedicated to weapons of mass destruction responses.                                                                     
                                                                                                                                
REPRESENTATIVE  GREEN  asked  if  these people  will  be  sitting                                                               
around waiting for something to happen.                                                                                         
                                                                                                                                
MR. CONWAY answered that they  will continually be operating with                                                               
training communities,  writing up  the plans,  preparing drilling                                                               
exercises,  and  doing   all  of  the  activities   that  a  fire                                                               
department does while waiting for a fire to happen.                                                                             
                                                                                                                                
Number 2282                                                                                                                     
                                                                                                                                
MR. CONWAY referred  to Item 74 under the  Department of Military                                                               
&  Veterans'   Affairs  ["Hazardous  Materials   Response  Teams:                                                               
Provide  training, trucks,  and  [equipment] for  2  new Level  A                                                               
HAZMAT  teams  in Valdez  and  in  Juneau to  service  Southeast;                                                               
Provide  Alaska-specific  detection,  identification  and  safety                                                               
equipment for 103d  CST (WMD) [Civilian Support  Team for Weapons                                                               
of  Mass Destruction];  and provide  WMD advanced  level training                                                               
for the  Fairbanks HAZMAT  team"] and said  that would  make four                                                               
teams  that   require  considerable  training,   exercising,  and                                                               
planning,  which are  typical emergency  preparedness activities.                                                               
He  indicated  that they  are  not  going  to be  sitting  around                                                               
waiting  for weapons  of mass  destruction incidences  to happen;                                                               
they  are   going  to  be   preparing.    They  will   work  with                                                               
municipalities, federal  agencies, the  civil support  team under                                                               
the National  Guard, and the  whole network of responders  in the                                                               
event of an attack.                                                                                                             
                                                                                                                                
Number 2345                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN asked  how they would fit in  with the other                                                               
agencies when there  is a problem.  He wondered  if there was any                                                               
duplication.                                                                                                                    
                                                                                                                                
MR.  CONWAY   replied  that  nobody  duplicates   services  in  a                                                               
response;  they all  come together  through the  incident command                                                               
system.   They would  be assigned  specific duties  as part  of a                                                               
joint incident  command system.   He explained  that it  would be                                                               
the same  as for a North  Slope spill.  There  are not standalone                                                               
capabilities  for  the  state;  they would  fit  in  with  local,                                                               
federal, and other state agency responders.                                                                                     
                                                                                                                                
REPRESENTATIVE  GREEN  asked  if they  would  be  "geographically                                                               
spread" or would they be stationed in one area.                                                                                 
                                                                                                                                
MR.  CONWAY  said that  the  assignments  of figuring  out  where                                                               
they'll be  hasn't been decided yet.   He offered to  get back to                                                               
him on that.                                                                                                                    
                                                                                                                                
Number 2421                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN wondered how the number six came up.                                                                       
                                                                                                                                
MR.  CONWAY  explained  that  the  state  emergency  coordination                                                               
center activates during  the time of a response  and will require                                                               
a 24-hour  watch capability, so  [the department] was  looking at                                                               
the  capability   to  augment  the  other   four  response  teams                                                               
throughout  the  state  and  have  two  positions  in  the  state                                                               
emergency coordination center at Fort Richardson.                                                                               
                                                                                                                                
Number 2490                                                                                                                     
                                                                                                                                
MR.  CONWAY referred  to Item  26, Decontamination  Equipment for                                                               
People  Exposed  to  Hazardous  Materials,  and  Item  27  ["Pre-                                                               
position  decontamination  foam and  trailers  in  six cities  to                                                               
serve  regions throughout  the state  and  obtain six  [fly-away]                                                               
decontamination  sets"].   He  told members  that  both of  these                                                               
items are  related to  responding to  and assisting  citizens who                                                               
are exposed to weapons of  mass destruction, either biological or                                                               
chemical agents.   The targets for a lot of  these attacks can be                                                               
several thousand  people, and there's  no capability  existing in                                                               
the  state to  get the  decontamination  equipment to  them.   He                                                               
explained that there is a two-way  approach to this:  1) In major                                                               
areas  of population,  Fairbanks,  Anchorage,  and Juneau,  there                                                               
would  be  a fixed  capability  there,  to rapidly  decontaminate                                                               
people  who  are  exposed  in  the event,  and  2)  a  deployment                                                               
capability located where the fixed  ones are in which there would                                                               
be  trailers  and  "airliftable"  things   to  get  to  a  remote                                                               
community.                                                                                                                      
                                                                                                                                
Number 2569                                                                                                                     
                                                                                                                                
CHAIR CHENAULT  asked Mr. Conway to  explain what decontamination                                                               
foam is.                                                                                                                        
                                                                                                                                
MR. CONWAY answered  that it is a chemical foam  used to spray on                                                               
equipment  and  in  buildings  to  attack  the  biological  agent                                                               
attached to things, neutralize, and destroy it.                                                                                 
                                                                                                                                
Number 2640                                                                                                                     
                                                                                                                                
CHAIR CHENAULT  surmised that  the six  fly-a-way decontamination                                                               
sets would include all the materials  needed in case of some type                                                               
of biological attack.                                                                                                           
                                                                                                                                
MR. CONWAY  indicated yes, it  would include the equipment.   The                                                               
equipment packages  would basically  be large capacity  hot water                                                               
heaters,   inflatable   shelters,   tents,  heaters,   and   mass                                                               
decontamination privacy  kits.   He noted  these things  were for                                                               
decontamination  of  the  people  affected.     In  answer  to  a                                                               
question,  he told  the Chair  that the  suits and  that sort  of                                                               
thing come under the other items for the responders.                                                                            
                                                                                                                                
Number 2722                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN asked what the  person in Anchorage used for                                                               
threatening the drinking water.                                                                                                 
                                                                                                                                
MR. CONWAY said  he had limited knowledge of it,  but there was a                                                               
threat by  somebody who was  angry about something and  told some                                                               
people  he  was going  to  poison  the Anchorage  drinking  water                                                               
system.  He was arrested and the case is in process.                                                                            
                                                                                                                                
MR. CONWAY responded to a  question from Representative Green and                                                               
said  the assessments  would look  at the  inroads that  somebody                                                               
would  try  to use  who  wanted  to  contaminate the  system  and                                                               
further, to be able to detect [the contaminant].                                                                                
                                                                                                                                
Number 2774                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN asked if there is any ongoing testing now.                                                                 
                                                                                                                                
MR. CONWAY  replied that the  larger municipalities  have ongoing                                                               
increased security and are testing.                                                                                             
                                                                                                                                
CHAIR CHENAULT  asked if the  assessments would be done  for most                                                               
of the public drinking water systems.                                                                                           
                                                                                                                                
Number 2859                                                                                                                     
                                                                                                                                
MR.  CONWAY  explained  that  the  large  public  drinking  water                                                               
systems  are being  looked at,  and  they are  attempting to  get                                                               
federal funds to do it.   He indicated that until the assessments                                                               
are done,  the department won't know  what to buy.   He indicated                                                               
that federal  money is  expected for  upgrading the  security and                                                               
detection systems on drinking water systems.                                                                                    
                                                                                                                                
Number 2892                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI  asked how  what the [Anchorage  Water &                                                               
Wastewater Utility]  does to  ensure that  its drinking  water is                                                               
safe  on   a  daily   basis  would  be   any  different   from  a                                                               
vulnerability assessment.                                                                                                       
                                                                                                                                
MR. CONWAY  answered that  [the department]  has worked  with the                                                               
municipalities  and said  it would  try to  get the  money to  do                                                               
that,  and it  will be  passed out  to them.   The  vulnerability                                                               
assessments   would  be   done   under  the   direction  of   the                                                               
municipalities.      In   the  current   structure,   the   local                                                               
municipalities  are  responsible  for  their systems.    The  DEC                                                               
provides some  oversight, but the municipalities  don't report to                                                               
DEC; they're not subservient, and  DEC doesn't direct them on how                                                               
to do that.                                                                                                                     
                                                                                                                                
Number 2972                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI asked if  the municipalities are already                                                               
doing it, why does the legislature  need to give them money.  She                                                               
wondered   if   there  is   a   different   component  when   the                                                               
vulnerability is  assessed than what  is done to ensure  that the                                                               
drinking water is safe.                                                                                                         
                                                                                                                                
MR. CONWAY  reminded her that  what they have been  talking about                                                               
today is for weapons of mass destruction.                                                                                       
                                                                                                                                
TAPE 02-14, SIDE B                                                                                                              
Number 2968                                                                                                                     
                                                                                                                                
MR.  CONWAY said  [the  municipalities]  haven't been  addressing                                                               
things for weapons of mass destruction.                                                                                         
                                                                                                                                
REPRESENTATIVE MURKOWSKI  said they  must do  a daily  testing to                                                               
make sure there  aren't weird things in it.   She offered that if                                                               
there were some  type of chemical agent, she thought  it would be                                                               
picked up.                                                                                                                      
                                                                                                                                
MR. CONWAY agreed  that they are testing for  things they expect.                                                               
He said,  "We don't know what  the biological agents would  be or                                                               
the chemicals that they might use.   We need to find that out and                                                               
then be able to see if we would be able to detect it."                                                                          
                                                                                                                                
[HB 324 was held over.]                                                                                                         
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
Number 2795                                                                                                                     
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Special Committee  on Military and Veterans'  Affairs meeting was                                                               
adjourned at 4:13 p.m.                                                                                                          

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