Legislature(2001 - 2002)

04/04/2002 03:20 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                                                                                      
                         April 4, 2002                                                                                          
                           3:20 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Mike Chenault, Chair                                                                                             
Representative Lisa Murkowski                                                                                                   
Representative Joe Green                                                                                                        
Representative Pete Kott                                                                                                        
Representative Joe Hayes                                                                                                        
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Beverly Masek                                                                                                    
Representative Sharon Cissna                                                                                                    
                                                                                                                                
OTHER LEGISLATORS PRESENT                                                                                                     
                                                                                                                                
Representative John Coghill                                                                                                     
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 323                                                                                                              
"An  Act relating  to  emergency and  disaster  relief forces  as                                                               
state employees  for purposes of workers'  compensation benefits;                                                               
relating to  the Emergency Management Assistance  Compact and the                                                               
implementation  of the  compact; and  providing for  an effective                                                               
date."                                                                                                                          
                                                                                                                                
     - MOVED HB 323 OUT OF COMMITTEE                                                                                            
                                                                                                                                
HOUSE BILL NO. 327                                                                                                              
"An  Act relating  to state  employees who  are called  to active                                                               
duty as reserve  or auxiliary members of the armed  forces of the                                                               
United States; and providing for an effective date."                                                                            
                                                                                                                                
     - MOVED HB 327 OUT OF COMMITTEE                                                                                            
                                                                                                                                
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."                                                                    
                                                                                                                                
     - MOVED HB 371 OUT OF COMMITTEE                                                                                            
                                                                                                                                
PREVIOUS ACTION                                                                                                               
                                                                                                                                
BILL: HB 323                                                                                                                  
SHORT TITLE:EMERGENCY MANAGEMENT ASSISTANCE COMPACT                                                                             
SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR                                                                                      
                                                                                                                                
Jrn-Date   Jrn-Page                     Action                                                                                  
01/16/02     1970       (H)        READ THE FIRST TIME -                                                                        
                                   REFERRALS                                                                                    
01/16/02     1970       (H)        MLV, STA, L&C                                                                                
01/16/02     1970       (H)        FN1: ZERO(MVA)                                                                               
01/16/02     1970       (H)        GOVERNOR'S TRANSMITTAL LETTER                                                                
04/04/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
                                                                                                                                
BILL: HB 327                                                                                                                  
SHORT TITLE:STATE EMPLOYEES CALLED TO MILITARY DUTY                                                                             
SPONSOR(S): RLS BY REQUEST OF THE GOVERNOR                                                                                      
                                                                                                                                
Jrn-Date   Jrn-Page                     Action                                                                                  
01/16/02     1977       (H)        READ THE FIRST TIME -                                                                        
                                   REFERRALS                                                                                    
01/16/02     1977       (H)        MLV, STA                                                                                     
01/16/02     1977       (H)        FN1: ZERO(ADM/ALL DEPTS)                                                                     
01/16/02     1977       (H)        GOVERNOR'S TRANSMITTAL LETTER                                                                
04/04/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
                                                                                                                                
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                                                                   
03/05/02                (H)        Heard & Held                                                                                 
03/05/02                (H)        MINUTE(MLV)                                                                                  
03/14/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
03/14/02                (H)        Scheduled But Not Heard                                                                      
03/26/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
03/26/02                (H)        Scheduled But Not Heard                                                                      
04/04/02                (H)        MLV AT 3:00 PM CAPITOL 124                                                                   
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
DAVE LIEBERSBACH, Director                                                                                                      
Division of Emergency Services                                                                                                  
Department of Military and Veterans' Affairs                                                                                    
P.O. Box 5750                                                                                                                   
Fort Richardson, Alaska  99505-5750                                                                                             
POSITION STATEMENT:  Presented HB 323 and answered questions.                                                                   
                                                                                                                                
CAROL CARROLL, Director                                                                                                         
Administrative Services Division                                                                                                
Department of Military and Veterans' Affairs                                                                                    
400 Willoughby, Suite 500                                                                                                       
Juneau, Alaska  99811                                                                                                           
POSITION STATEMENT:  Answered questions relating to HB 323;                                                                     
offered a recap of some pertinent details of HB 371 and answered                                                                
questions.                                                                                                                      
                                                                                                                                
DAVE STEWART, Personnel Manager                                                                                                 
Division of Personnel                                                                                                           
Department of Administration                                                                                                    
P.O. Box 110201                                                                                                                 
Juneau, Alaska  99811-0201                                                                                                      
POSITION STATEMENT:  Presented HB 327 and answered questions.                                                                   
                                                                                                                                
DEBRA GERRISH                                                                                                                   
9202 Emily Way                                                                                                                  
Juneau, Alaska 99801                                                                                                            
POSITION STATEMENT:   During hearing on HB 327,  testified as the                                                               
wife of an Army officer in  the national guard about the need for                                                               
medical   coverage  for   dependents,  in   particular;  answered                                                               
questions.                                                                                                                      
                                                                                                                                
CHUCK HARLAMERT, Juneau Section Chief                                                                                           
Central Office                                                                                                                  
Tax Division                                                                                                                    
Department of Revenue                                                                                                           
P.O. Box 110420                                                                                                                 
Juneau, Alaska  99811-0420                                                                                                      
POSITION STATEMENT:  Answered questions relating to HB 371.                                                                     
                                                                                                                                
JOHN JENKS, Chief Investment Officer                                                                                            
Treasury Division                                                                                                               
Department of Revenue                                                                                                           
P.O. Box 110405                                                                                                                 
Juneau, Alaska  99811-0405                                                                                                      
POSITION STATEMENT:  Answered questions relating to HB 371.                                                                     
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 02-19, SIDE A                                                                                                              
Number 0001                                                                                                                     
                                                                                                                                
CHAIR  MIKE  CHENAULT  called  the  House  Special  Committee  on                                                               
Military  and Veterans'  Affairs meeting  to order  at 3:20  p.m.                                                               
Representatives  Chenault,  Murkowski,   Green,  and  Hayes  were                                                               
present at  the call  to order.   Representative Kott  arrived as                                                               
the meeting was in progress.                                                                                                    
                                                                                                                                
HB 323-EMERGENCY MANAGEMENT ASSISTANCE COMPACT                                                                                
                                                                                                                                
CHAIR CHENAULT announced  that the first order  of business would                                                               
be  HOUSE  BILL  NO.  323,  "An Act  relating  to  emergency  and                                                               
disaster  relief  forces  as  state  employees  for  purposes  of                                                               
workers'  compensation   benefits;  relating  to   the  Emergency                                                               
Management  Assistance  Compact  and the  implementation  of  the                                                               
compact; and  providing for  an effective date."   [The  bill was                                                               
sponsored by  the House  Rules Standing  Committee by  request of                                                               
the governor.]                                                                                                                  
                                                                                                                                
Number 0146                                                                                                                     
                                                                                                                                
DAVE  LIEBERSBACH,  Director,  Division  of  Emergency  Services,                                                               
Department of  Military and  Veterans' Affairs  (DMVA), explained                                                               
that  HB   323  relates  to  joining   the  nationwide  Emergency                                                               
Management Assistance Compact (EMAC),  which provides a framework                                                               
to   rapidly  exchange   emergency   resources,  including   both                                                               
personnel and equipment, between  states.  Although resources can                                                               
be  moved  currently,  that   first  requires  making  agreements                                                               
between the receiving state and the  sending state as to who will                                                               
pay for what,  coverage for workers' compensation,  and so forth.                                                               
By being  a member  of EMAC,  the state  already would  have pre-                                                               
agreed  to the  details.   The  requesting state  pays for  those                                                               
resources  it  receives.    Mr.  Liebersbach  said  there  is  no                                                               
financial requirement  up front  unless there  is a  disaster for                                                               
which  Alaska requests  resources and  then  pays for  them.   He                                                               
offered his belief  that 45 states already are  EMAC members, and                                                               
cited Hawaii, Alaska, and California as three that aren't.                                                                      
                                                                                                                                
Number 0381                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GREEN referred  to  exchanges  of "fire  jumpers"                                                               
between  Alaska and  other  states.   He  asked  whether this  is                                                               
prearranged, with costs already determined.                                                                                     
                                                                                                                                
MR.  LIEBERSBACH answered  that it's  a national  program through                                                               
the "wildland  fire services," and that  financial agreements are                                                               
in place when fire-related resources  are sent from Alaska to the                                                               
Lower 48.    The  lead  was  taken  by  the  U.S.  Department  of                                                               
Agriculture, U.S. Forest Service, as  well as various agencies of                                                               
the U.S.  Department of the  Interior, to  provide for that.   He                                                               
explained that  EMAC is an attempt  by states to fill  a vacuum -                                                               
never  filled by  a  federal  agency -  for  all  other types  of                                                               
disasters,  called  "all-risk"  or   "all-hazard."    Hence  this                                                               
probably wouldn't  affect wildland  fire resources, but  it would                                                               
affect all others,  which have no existing agreements.   He noted                                                               
that many  years ago there was  frustration with trying to  get a                                                               
federal  agency -  primarily,  the  Federal Emergency  Management                                                               
Agency (FEMA)  - to take the  lead, but that didn't  happen.  The                                                               
compact then began  in southeastern states and  expanded over the                                                               
last three or four years to include most states in the nation.                                                                  
                                                                                                                                
Number 0545                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN  requested examples  of personnel  who would                                                               
be  gained  in an  earthquake,  for  instance.   He  asked  about                                                               
medical personnel.                                                                                                              
                                                                                                                                
MR.  LIEBERSBACH  agreed  there   is  a  possibility  of  medical                                                               
personnel.   He  added that  for a  federally declared  disaster,                                                               
there  is an  option  of  going through  FEMA  and other  federal                                                               
agencies.     However,  some  state-specific  things   cannot  be                                                               
obtained through  the federal agencies.   A couple of  years ago,                                                               
for  example, expertise  was brought  in from  Missouri and  Iowa                                                               
under an  agreement with those  states.  He explained,  "I didn't                                                               
really need  a federal person  here, because we  were negotiating                                                               
with the  federal government on  these issues, and I  needed some                                                               
people who understood it from a state perspective."                                                                             
                                                                                                                                
MR.  LIEBERSBACH  went   on  to  say  this   also  provides  some                                                               
assistance -  not as  much for  Alaska as for  other states  - in                                                               
moving national  guard resources  such as helicopters  from state                                                               
to state without  having to "federalize the national  guard."  He                                                               
indicated that  if Alaska had  been a member of  EMAC, assistance                                                               
to New York City could  have happened more rapidly [following the                                                               
terrorist attacks of September 11, 2001].                                                                                       
                                                                                                                                
Number 0750                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN asked whether the  plan is to have some sort                                                               
of   person  or   group   pre-negotiate   services,  or   whether                                                               
negotiations will be done after the fact.                                                                                       
                                                                                                                                
MR. LIEBERSBACH said  costs are set up in the  structure of EMAC;                                                               
they are pre-negotiated and just  require concurrence, or refusal                                                               
to concur, for either sending or receiving.                                                                                     
                                                                                                                                
Number 0866                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI  observed that  the compact makes  a lot                                                               
of sense for neighboring states in  the Lower 48.  She asked when                                                               
Alaska has  called upon  other states  for assistance  other than                                                               
for firefighting.                                                                                                               
                                                                                                                                
MR. LIEBERSBACH cited two examples.   First, in 1999 or 2000 he'd                                                               
requested  personnel   from  Missouri  and  Iowa   following  the                                                               
avalanches, since  those states  were more familiar  with dealing                                                               
with   the   new   federal   disaster-related   regulations   and                                                               
requirements;  the goal  was to  resolve issues  in favor  of the                                                               
state, rather than  the federal government.   Second, although it                                                               
didn't  come to  fruition, dog  teams from  Washington State  had                                                               
been considered if the avalanches had worsened.                                                                                 
                                                                                                                                
Number 1104                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI asked why the  compact is proposed to be                                                               
fully incorporated  in the statute, since  statutory changes will                                                               
be required if there are changes to the compact.                                                                                
                                                                                                                                
MR.  LIEBERSBACH  responded  that  one requirement  to  become  a                                                               
member of  EMAC is that  the legislature fully accept  or endorse                                                               
its  concepts "in  a  fairly  robust way";  this  is unlike  many                                                               
compacts Alaska  enters into.   As  for the  decision to  put the                                                               
actual wording in statute, he  suggested asking Carol Carroll [of                                                               
the DMVA].   He explained that one reason he  hadn't come forward                                                               
with  the concept  of entering  EMAC  for several  years was  the                                                               
desire to watch it maturate in  other states and then discuss how                                                               
it was working  with his counterparts in those states.   A lot of                                                               
changes have  happened with EMAC  in the  four years he  has been                                                               
the director  of emergency services, he  told members, suggesting                                                               
that  now it  is  a  stable product  and  will  have few  changes                                                               
relating to the statutory portion.                                                                                              
                                                                                                                                
Number 1308                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GREEN  asked  whether   the  state  may  opt  out                                                               
[later].                                                                                                                        
                                                                                                                                
MR. LIEBERSBACH said he couldn't  answer immediately.  He offered                                                               
his belief that this compact  doesn't require the state to either                                                               
send  or request  people, but  lays the  groundwork if  the state                                                               
chooses to go this route in  an emergency.  He also indicated his                                                               
understanding that other compacts only  require the state to give                                                               
notice before  withdrawing.  He  reported that the  other compact                                                               
in  the  realm in  which  he  works  in a  northwestern  regional                                                               
emergency  management  compact  among Alaska,  Washington  State,                                                               
Oregon, Idaho,  British Columbia,  and the Yukon  Territory; even                                                               
after  joining  EMAC,  Alaska  will remain  in  that  because  it                                                               
includes the Canadian province and territory.                                                                                   
                                                                                                                                
Number 1516                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GREEN  asked  about any  priorities  relating  to                                                               
population  or  severity, for  example,  if  two or  more  states                                                               
require simultaneous emergency medical assistance.                                                                              
                                                                                                                                
MR. LIEBERSBACH  answered that in  the operational part  of EMAC,                                                               
an "A  team" is  set up  that rotates from  state to  state about                                                               
every  two years.    Citing East  Coast  hurricanes as  something                                                               
affecting  multiple  states,  he  noted that  EMAC  broadens  the                                                               
resource base.  Although FEMA  can activate federal resources, it                                                               
has no  authority to  activate state resources  and send  them to                                                               
another  state.   Thus if  Alaska and  California needed  medical                                                               
help simultaneously, in addition  to what's available through the                                                               
federal  government  -  which  may  well  respond  to  California                                                               
because  of its  population,  for instance  -  Alaska would  have                                                               
access to resources through EMAC.   He said he didn't know of any                                                               
instance  when  a priority  was  established  of one  state  over                                                               
another  based on  such criteria,  but  suggested that  immediate                                                               
[danger  to]   life  and  property   would  take   priority  over                                                               
everything else.                                                                                                                
                                                                                                                                
Number 1673                                                                                                                     
                                                                                                                                
CHAIR  CHENAULT noted  that  Section  2 of  the  bill allows  the                                                               
governor  to  establish  international relationships  and  mutual                                                               
aid.  He asked whether that is envisioned as part of EMAC.                                                                      
                                                                                                                                
MR.  LIEBERSBACH said  he  isn't totally  familiar  with it,  but                                                               
offered his understanding that the  governor has authority, under                                                               
Title 26  of current statute,  to enter into compacts  for mutual                                                               
aid  with  other  states;  he  surmised  that  it  would  include                                                               
international  agreements,  but  said  he'd  have  to  check  the                                                               
statutes.   He  went on  to  say that  the northwestern  regional                                                               
compact was  entered into through  the signature of  the governor                                                               
because of  that authority; however, EMAC  itself requires coming                                                               
before the legislature.  He  suggested the bill just restates the                                                               
governor's authority  to enter into these  compacts for emergency                                                               
management purposes.                                                                                                            
                                                                                                                                
MR. LIEBERSBACH,  in further reply,  reported that  basically the                                                               
compact  says that  whatever  the person  earns  in his/her  home                                                               
state   is   what  the   requesting   state   accepts  for   wage                                                               
compensation, health and disability benefits, and so forth.                                                                     
                                                                                                                                
Number 1900                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI observed  that  Section  5 repeals  the                                                               
Interstate  Civil  Defense  and  Disaster  Compact.    She  asked                                                               
whether the state still operates  under the terms of that compact                                                               
and whether it still exists.                                                                                                    
                                                                                                                                
MR. LIEBERSBACH  answered that it's  on the books, but  he doubts                                                               
it  has been  used  for a  couple  of decades.    He related  his                                                               
understanding that EMAC replaces and  takes care of everything in                                                               
that compact.                                                                                                                   
                                                                                                                                
Number 1961                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI asked Ms.  Carroll about the reasons for                                                               
fully  incorporating EMAC  into the  statute itself,  rather than                                                               
adopting it by reference.                                                                                                       
                                                                                                                                
Number 2015                                                                                                                     
                                                                                                                                
CAROL  CARROLL,   Director,  Administrative   Services  Division,                                                               
Department  of Military  and Veterans'  Affairs, said  she didn't                                                               
know,  though  the  previous  one was  in  statute  and  portions                                                               
remain.   She added that she  could ask the attorneys  whether it                                                               
could just be referenced.                                                                                                       
                                                                                                                                
REPRESENTATIVE  MURKOWSKI   observed  that  the  bill   would  be                                                               
referred to  [the House Labor  and Commerce  Standing Committee],                                                               
which  she chairs.    She  requested that  Ms.  Carroll find  out                                                               
before the hearing there.                                                                                                       
                                                                                                                                
REPRESENTATIVE  GREEN  asked  what  happens under  EMAC  if  four                                                               
Alaskan experts are  needed at home but are  requested by another                                                               
state.                                                                                                                          
                                                                                                                                
MS. CARROLL replied  that Alaska always would have  the option to                                                               
either agree  to send  them or  else to say,  "No, we  need these                                                               
people at home."                                                                                                                
                                                                                                                                
Number 2109                                                                                                                     
                                                                                                                                
REPRESENTATIVE  KOTT  concurred with  Representative  Murkowski's                                                               
line of questioning.   He offered his belief  that this [compact]                                                               
could be adopted by reference, but  said he'd wait until a future                                                               
committee of referral to offer it as an amendment.                                                                              
                                                                                                                                
Number 2139                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI moved to report  HB 323 out of committee                                                               
with individual recommendations and  the accompanying zero fiscal                                                               
note.   There being no  objection, HB  323 was reported  from the                                                               
House Special Committee on Military and Veterans' Affairs.                                                                      
                                                                                                                                
The committee took an at-ease from 3:50 p.m. to 3:53 p.m.                                                                       
                                                                                                                                
HB 327-STATE EMPLOYEES CALLED TO MILITARY DUTY                                                                                
                                                                                                                                
CHAIR CHENAULT  announced that the  next order of  business would                                                               
be HOUSE  BILL NO. 327, "An  Act relating to state  employees who                                                               
are called to active duty as  reserve or auxiliary members of the                                                               
armed  forces  of  the  United   States;  and  providing  for  an                                                               
effective  date."   [The bill  was sponsored  by the  House Rules                                                               
Standing Committee by request of the governor.]                                                                                 
                                                                                                                                
Number 2186                                                                                                                     
                                                                                                                                
DAVE   STEWART,  Personnel   Manager,   Division  of   Personnel,                                                               
Department  of  Administration,  informed  members  that  HB  327                                                               
allows Alaska to offer  a supplemental wage-and-benefit structure                                                               
to state employees  called to active military duty.   The federal                                                               
[Uniformed  Services Employment  and Reemployment  Rights Act  of                                                               
1994 (USERRA)] allows certain benefits,  both in job security and                                                               
wage-and-benefit  security,   for  employees  called   to  active                                                               
service  by the  President of  the United  States; however,  that                                                               
protection doesn't exist for state  employees activated by a call                                                               
of the governor.   Hence this legislation allows  the governor to                                                               
issue  an  administrative  order  declaring  an  emergency  of  a                                                               
particular nature  and invoking the  [provisions] in HB  327 that                                                               
allow state agencies  to supplement military income  to the level                                                               
of state income in order  to prevent hardship on employees called                                                               
to  active  service  and  their   dependents.    It  also  allows                                                               
continuation  of  benefits  and  the  same  protection  as  under                                                               
federal activation, he told members.                                                                                            
                                                                                                                                
Number 2303                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI surmised  that there  is no  particular                                                               
time period associated with the call  to active duty, and posed a                                                               
situation in which a person is only on active duty for 60 days.                                                                 
                                                                                                                                
MR. STEWART  answered that  as the  bill is  written, it  is just                                                               
"active  duty".   He added,  "The  presumption would  be, in  the                                                               
administrative  order that  activated  a  contingent of  workers,                                                               
there would be the specification of  duration."  He said for most                                                               
of  the lengthier  periods  of activation,  it  is believed  that                                                               
those would  be at  the federal  level; thus  federal legislation                                                               
would  kick  in for  absences  up  to  five years  under  USERRA.                                                               
However,  HB  327 is  nonspecific  regarding  length because  the                                                               
nature of  the emergencies that  would call upon  this activation                                                               
authority  are  believed to  have  a  duration  of two  or  three                                                               
months; those include fire, flood, or catastrophic damage.                                                                      
                                                                                                                                
Number 2399                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI brought  attention to  the zero  fiscal                                                               
note and  asked how the  state would accommodate paying  both the                                                               
person  called  to  active  duty   and  that  person's  temporary                                                               
replacement.                                                                                                                    
                                                                                                                                
MR. STEWART  answered that the  zero fiscal note  presumes fairly                                                               
limited  use  of  this administrative  authority.    Noting  that                                                               
someone  from  the  chair's   office  had  requested  information                                                               
subsequent to  preparation of the  fiscal note, Mr.  Stewart said                                                               
those  figures  are  being  pulled together  and  that  he  could                                                               
provide ballpark figures.  With  respect to the zero fiscal note,                                                               
he indicated the department is just  now looking at the number of                                                               
people activated  since [the terrorist  attacks of  September 11,                                                               
2001,  on the  East Coast],  and  surmised that  the fiscal  note                                                               
might be amended as the bill moves through the process.                                                                         
                                                                                                                                
MR.  STEWART,   in  further  response,  said   220-225  employees                                                               
possibly may be  activated into the national guard;  of those, 30                                                               
are currently activated and an  additional 23 have been called to                                                               
some period of active duty since  September 11, 2001, some for as                                                               
little as one day.                                                                                                              
                                                                                                                                
Number 2509                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI  reported  receipt of  an  e-mail  from                                                               
someone who appears to be in  the active military, rather than in                                                               
the  reserves; it  references the  Municipality of  Anchorage and                                                               
the state as  providers of benefits and compensation.   She asked                                                               
whether  there is  anything going  on with  the municipality,  or                                                               
whether this e-mail doesn't cite the facts correctly.                                                                           
                                                                                                                                
MR. STEWART  offered his understanding  that the  Municipality of                                                               
Anchorage doesn't offer a plan  extending benefits.  He said that                                                               
at one point, when this  legislation was first introduced, it was                                                               
thought it  could apply  broadly "to  public service  in Alaska."                                                               
He said  the idea behind  the legislation  was that the  State of                                                               
Alaska would be a demonstration to  set the pace for other public                                                               
employers.  However,  the administrative-order authority wouldn't                                                               
affect municipalities or other public employers.                                                                                
                                                                                                                                
Number 2575                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN  asked whether any areas  of government have                                                               
both  union and  non-union personnel  who could  be activated  by                                                               
order of the governor.                                                                                                          
                                                                                                                                
REPRESENTATIVE  GREEN referred  to Section  2, the  applicability                                                               
section  of  the  bill,  and   observed  that  it  says  until  a                                                               
collective  bargaining agreement  expires, people  would only  be                                                               
covered by this Act [if that  agreement is modified to accept the                                                               
provisions  of  this  Act].   He  expressed  concern  about  that                                                               
happening for people who [work side by side].                                                                                   
                                                                                                                                
MR.  STEWART answered  that it  most likely  would occur  with an                                                               
appointed  supervisory   or  managerial  employee   working  with                                                               
unionized staff.   He said  he hadn't had  personal conversations                                                               
with  representatives of  collective  bargaining  over that,  but                                                               
that it  would be  difficult for  him to  foresee a  situation in                                                               
which   there  wouldn't   be  agreement   with  regard   to  some                                                               
modification of the contract.                                                                                                   
                                                                                                                                
Number 2660                                                                                                                     
                                                                                                                                
REPRESENTATIVE  KOTT   noted  that   Section  3  makes   the  Act                                                               
retroactive  to September  11, 2001.    He asked  how many  state                                                               
employees  have  been "swept  into  this  arena" because  of  the                                                               
events of September 11.                                                                                                         
                                                                                                                                
MR. STEWART  replied that when  the bill was  introduced, twenty-                                                               
two employees  had been activated;  one potentially  was affected                                                               
by the legislation, and others  were earning more in the military                                                               
than from  state employment.   Since then, thirty  to thirty-five                                                               
more have  been activated for some  period of time.   "Not many,"                                                               
he concluded, highlighting the difficulty with the fiscal note.                                                                 
                                                                                                                                
Number 2754                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI  read  aloud   from  the  e-mail  she'd                                                               
mentioned previously:                                                                                                           
                                                                                                                                
     Why  should the  guard receive  special privileges  and                                                                    
     coverage  when they're  called to  active duty?   These                                                                    
     people  are paid  to be  in the  guard, and  still have                                                                    
     regular jobs  with benefits.   They're well  aware that                                                                    
     they  will be  paid the  same pay  and benefits  as the                                                                    
     active-duty  service  personnel   if  they  are  needed                                                                    
     during times of crisis.                                                                                                    
                                                                                                                                
REPRESENTATIVE  MURKOWSKI  requested  that Mr.  Stewart  respond.                                                               
She also asked,  when public employees in the  reserves have been                                                               
called  up, whether  [the state  historically] has  done anything                                                               
for them in terms of compensation.                                                                                              
                                                                                                                                
Number 2801                                                                                                                     
                                                                                                                                
MR. STEWART  replied that in  the past, [the state]  did nothing,                                                               
although statute and regulation allow  payment of up to five days                                                               
of "supplemented wage  pay" for state employees  activated by the                                                               
governor's authority.                                                                                                           
                                                                                                                                
REPRESENTATIVE MURKOWSKI  asked whether  that is  under emergency                                                               
orders.                                                                                                                         
                                                                                                                                
MR.  STEWART  affirmed that.    He  said  for employees  who  are                                                               
federally activated for  training purposes, collective bargaining                                                               
and regulation allow about 16.5 days  a year of paid time off for                                                               
dealing with that.  He added,  "Those are the only two provisions                                                               
for wage or benefit supplementation in any event of activation."                                                                
                                                                                                                                
MR. STEWART informed  members that there were a  couple of things                                                               
considered  in conceiving  this legislation.   During  the events                                                               
surrounding September 11, 2001,  people were activated nationwide                                                               
and  put into  situations that  hadn't occurred  in the  national                                                               
guard  setting  previously.   He  indicated  a number  of  states                                                               
immediately passed legislation  such that for periods  of a year,                                                               
six months, or  even thirty days, wage  supplementation for their                                                               
employees would be set in place.  He told members:                                                                              
                                                                                                                                
     We believed, in acting as  an employer, that this was a                                                                    
     good first step to take.   The scope of the legislation                                                                    
     is intended  to allow this  to be broadened  to active-                                                                    
     duty military  personnel activated by the  President if                                                                    
     the governor so  activates that administrative process.                                                                    
     So  the two-pronged  answer is:    we wanted  to do  it                                                                    
     because we're  an employer and  it was a  good employer                                                                    
     thing  to do,  but the  legislation is  also set  up so                                                                    
     that if  we wanted to include  all active-duty military                                                                    
     personnel,  it could  be  done in  the  context of  the                                                                    
     administrative order.                                                                                                      
                                                                                                                                
Number 2912                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI  mentioned conversations  in  committee                                                               
with Major General Oates regarding  the evolving structure in the                                                               
military and the  heightened role of the guard in  the state, who                                                               
are doing  a lot more  now and having a  lot more asked  of them.                                                               
She suggested that  there could be situations  when guard members                                                               
are  called up  for long  periods  of time,  which she  indicated                                                               
could cost the state a lot, even though it is worth it.                                                                         
                                                                                                                                
TAPE 02-19, SIDE B                                                                                                              
Number 2976                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI asked  whether  [this  bill] is  fairly                                                               
comparable to what other states have adopted.                                                                                   
                                                                                                                                
MR. STEWART  replied yes, indicating  he could provide a  list of                                                               
states and  their related  legislation.  In  reply to  a question                                                               
from  Chair Chenault,  he  said roughly  13  states have  enacted                                                               
legislation  "over  and  above  their  normal  military  training                                                               
time";  he  mentioned  22  days for  national  guard  service  or                                                               
training.  He  went on to say 2 states  already had comprehensive                                                               
military-leave statutes beyond the scope of Alaska's.                                                                           
                                                                                                                                
Number 2896                                                                                                                     
                                                                                                                                
DEBRA GERRISH, noting that she is  the wife of an Army officer in                                                               
the  national guard,  informed members  that she'd  done research                                                               
and had some  real concerns.  She explained that  when someone is                                                               
called up  for military service,  dependents aren't  covered [for                                                               
medical insurance]  unless the orders  are for 180 days  or more;                                                               
for example, some families currently  lack coverage although [the                                                               
military  family  member] was  called  up  the previous  October.                                                               
Ms. Gerrish   stressed  the   importance  of   medical  coverage,                                                               
including  coverage for  preexisting conditions,  which she  said                                                               
the military  insurance doesn't  like to cover.   She  said she'd                                                               
been  told that  Juneau residents  are lucky  because there  is a                                                               
medical clinic,  whereas people who  live in  Haines, Petersburg,                                                               
and Wrangell have no clinic to turn to.                                                                                         
                                                                                                                                
MS.   GERRISH   requested   that  if   committee   members   feel                                                               
uncomfortable about the  pay in the bill, they  perhaps divide it                                                               
in half.   She  said the  health insurance  is what  the families                                                               
really need.   Because her  husband is an officer,  she indicated                                                               
her family can  survive financially with less  money, but pointed                                                               
out that  a family headed  by a private  or sergeant won't  be in                                                               
the  same  boat,  since  it  costs  a  lot  to  live  in  Alaska.                                                               
Therefore, families  need the  military pay to  be equal  to what                                                               
they  earn at  the state  level, if  possible, but  barring that,                                                               
must have the health insurance.                                                                                                 
                                                                                                                                
MS.  GERRISH  provided the  name  of  the national  guard  health                                                               
insurance  person, Michelle  (ph)  Schuller  of Anchorage,  phone                                                               
number  (907)  428-6483.    She  cited the  example  of  her  own                                                               
daughter as  someone who has  asthma attacks.  She  asked members                                                               
to think seriously about the  bill and consider the families, and                                                               
again emphasized  that people who  were called up in  October are                                                               
having a hard time making ends meet.                                                                                            
                                                                                                                                
Number 2689                                                                                                                     
                                                                                                                                
MS.  GERRISH,  in  response   to  questions  from  Representative                                                               
Murkowski  and Chair  Chenault, said  it's only  if the  military                                                               
orders  say 180  days or  more that  [dependents] get  any health                                                               
insurance at  all.  "We  get zero as  it stands now,"  she added.                                                               
The soldiers  become covered  as soon as  they're called  up, but                                                               
dependent coverage is based on how  long the soldier is called up                                                               
for.   If the person is  a state employee with  medical coverage,                                                               
that coverage ends on the last  day of the month during which the                                                               
person  is  called up.    When  someone  goes on  military  duty,                                                               
his/her job  is saved, but the  person no longer is  considered a                                                               
state employee.                                                                                                                 
                                                                                                                                
Number 2542                                                                                                                     
                                                                                                                                
MS. GERRISH, addressing questions  about coverage for preexisting                                                               
conditions,  specified   that  she  was  talking   about  CHAMPUS                                                               
[Civilian  Health and  Medical  Program  Uniformed Service],  the                                                               
military insurance.  If her husband  is called up for 180 days or                                                               
more, the family goes to  military insurance, which doesn't cover                                                               
her daughter's asthma or Ms.  Gerrish's epilepsy.  She noted that                                                               
her  husband  right  now  is learning  how  to  handle  hazardous                                                               
materials  because of  the terrorist  attacks [of  September 11];                                                               
citing this four-day training as  an example of extra days people                                                               
are required to  put in, she said her husband  is covered because                                                               
the time  is within the  16.5-day limit discussed  earlier, which                                                               
is already  in place in  Alaska.  It is  when the duty  goes past                                                               
that amount [that coverage becomes a problem].                                                                                  
                                                                                                                                
REPRESENTATIVE MURKOWSKI thanked Ms.  Gerrish for providing real-                                                               
life examples that illustrate the bill.                                                                                         
                                                                                                                                
Number 2367                                                                                                                     
                                                                                                                                
MR.  STEWART,  in  response to  a  question  from  Representative                                                               
Hayes, explained  that an employee  who leaves state  service and                                                               
becomes  unpaid by  the state  - whether  "separated" from  state                                                               
service or not - is covered  by medical insurance for that entire                                                               
[calendar] month; a person may  be in leave-without-pay status on                                                               
the first day of the month,  however, so that no health insurance                                                               
contribution  is  made.    He  noted  that  COBRA  [Comprehensive                                                               
Omnibus Budget  Reform Act] insurance  may be purchased  in order                                                               
to continue  coverage, but there  is no provision for  paying the                                                               
COBRA  premium, an  expensive item  for families  who have  state                                                               
coverage.  He told members:                                                                                                     
                                                                                                                                
     But  there's certainly  the liberal  use of  paid leave                                                                    
     for putting  people in pay  status on  lengthy military                                                                    
     leave  on the  first day  of the  month, so  that those                                                                    
     premiums are  made or,  as ...  the bill  would provide                                                                    
     under certain circumstances, the  actual payment of ...                                                                    
     the employer's [portion] of  the premium throughout the                                                                    
     period of service.                                                                                                         
                                                                                                                                
MR. STEWART, in  response to questions from  Chair Chenault, said                                                               
there  is an  option [to  pay]  the employee's  portion, too,  in                                                               
order to continue that person's current coverage.                                                                               
                                                                                                                                
Number 2262                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI  noted that  page 1 gives  discretion to                                                               
determine whether people will receive  some or all of their state                                                               
benefits.  She asked how that would work.                                                                                       
                                                                                                                                
MR. STEWART specified that the  intent of the legislation is that                                                               
the  decision would  be  at the  gubernatorial  level through  an                                                               
administrative order.   The flexibility  is to decide  whether to                                                               
order   health  insurance,   retirement,  health   insurance  and                                                               
retirement, or just wages.                                                                                                      
                                                                                                                                
REPRESENTATIVE  MURKOWSKI  highlighted Ms.  Gerrish's  suggestion                                                               
that, above all, there should be health benefits.                                                                               
                                                                                                                                
MR. STEWART, in  response to questions from  Chair Chenault, said                                                               
the administrative order would be  issued for a specific incident                                                               
and [the  decision about what  benefits to provide] would  be per                                                               
incident, covering the group of employees called.                                                                               
                                                                                                                                
Number 2157                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI pointed  out the  problem mentioned  by                                                               
Ms. Gerrish:   an officer's  family can  get buy on  an officer's                                                               
salary,  but   really  needs  the  health   benefits  because  of                                                               
preexisting conditions,  for example, whereas a  private's family                                                               
may  need the  wages even  more.   Representative Murkowski  said                                                               
she'd like to see some  flexibility, but didn't know whether such                                                               
flexibility could be worked into it.                                                                                            
                                                                                                                                
REPRESENTATIVE GREEN  suggested it  would be  dicey for  the same                                                               
call-up and expressed concern about prejudicial use.                                                                            
                                                                                                                                
REPRESENTATIVE MURKOWSKI mentioned doing it through regulation.                                                                 
                                                                                                                                
CHAIR CHENAULT surmised  that it would have to be  done by group,                                                               
rather than individually.                                                                                                       
                                                                                                                                
Number 2082                                                                                                                     
                                                                                                                                
MR. STEWART  clarified that  this is  intended to  supplement the                                                               
wages of people  who would make less while on  military duty; for                                                               
that reason, a person who isn't  earning less won't be dealt with                                                               
[under the bill].  It is for those who would be worse off.                                                                      
                                                                                                                                
Number 2057                                                                                                                     
                                                                                                                                
REPRESENTATIVE   HAYES  surmised   that   the   fiscal  note   is                                                               
indeterminate and asked about cost estimates.                                                                                   
                                                                                                                                
MR.  STEWART reported  that the  first fiscal  note [calculation]                                                               
was  $400 for  one individual,  but that  he'd be  embarrassed to                                                               
submit a fiscal  note for that amount.  Saying  there's almost an                                                               
"incident variation"  that depends  upon who  has been  called up                                                               
and  the duration,  he  invited dialogue  to  deal with  concerns                                                               
about duration before this bill moves to another committee.                                                                     
                                                                                                                                
Number 2004                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI asked  what is  shown by  a handout  [a                                                               
side-by-side comparison  of the  various states,  dated 12/10/01]                                                               
provided  by  Mr. Stewart.    [The  three  columns  were  headed:                                                               
"Military pay augmentation";  "Health Coverage continuation, non-                                                               
COBRA"; and "Other Arrangements?"]                                                                                              
                                                                                                                                
MR.  STEWART  replied that  the  question  asked of  the  states'                                                               
"personnel people" who responded was,  "What do you have in place                                                               
in addition  to the training  leave that's  commonly negotiated?"                                                               
The  survey went  out two  weeks  after September  11 [2001],  he                                                               
noted, and there was no subsequent follow-up.                                                                                   
                                                                                                                                
REPRESENTATIVE  MURKOWSKI,  still   discussing  the  side-by-side                                                               
comparison, asked  whether there should be  something in Alaska's                                                               
blank columns, since the state allows  for leave with pay for the                                                               
16-day period.                                                                                                                  
                                                                                                                                
MR. STEWART  said everybody has  that; it was  "grandparented in"                                                               
through collective bargaining.   He'd have put  something [in the                                                               
columns for Alaska] if something else were in place, he noted.                                                                  
                                                                                                                                
Number 1910                                                                                                                     
                                                                                                                                
MS.  GERRISH informed  members that  her family  had figured  out                                                               
they could manage to live  [on the officer's salary] but couldn't                                                               
pay COBRA as  well.  She suggested imagining how  it would be for                                                               
[the family of] a private or sergeant.                                                                                          
                                                                                                                                
REPRESENTATIVE MURKOWSKI  noted that the  side-by-side comparison                                                               
shows that  many states  have a  reference to  COBRA.   She asked                                                               
whether that means that states are picking up the COBRA costs.                                                                  
                                                                                                                                
MR.  STEWART said  no.   He clarified  that "COBRA  only" on  the                                                               
handout refers to the federal  requirement that employee benefits                                                               
be continued, but it is at the employee's expense.                                                                              
                                                                                                                                
CHAIR  CHENAULT  asked whether  anyone  else  wished to  testify;                                                               
there was no response.                                                                                                          
                                                                                                                                
Number 1796                                                                                                                     
                                                                                                                                
REPRESENTATIVE KOTT moved to report  HB 327 out of committee with                                                               
individual  recommendations  and the  accompanying  indeterminate                                                               
fiscal note.  There being no  objection, HB 327 was reported from                                                               
the House Special Committee on Military and Veterans' Affairs.                                                                  
                                                                                                                                
HB 371-ALASKA VETERANS' MEM.ENDOWMENT FUND                                                                                    
                                                                                                                                
CHAIR CHENAULT announced  that the final order  of business would                                                               
be 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."   [The bill  was sponsored  by the  House Rules                                                               
Standing Committee by request of the governor.]                                                                                 
                                                                                                                                
Number 1705                                                                                                                     
                                                                                                                                
CAROL  CARROLL,   Director,  Administrative   Services  Division,                                                               
Department of  Military and  Veterans' Affairs  (DMVA), explained                                                               
that HB  371 creates a  veterans' memorial endowment fund  in the                                                               
Department of Revenue.   It allows a credit like  the one allowed                                                               
in statute already  for the University of Alaska,  and is limited                                                               
to  $150,000.   She  reported  that  DMVA, in  coordination  with                                                               
veterans'  groups,  allocates  in  the form  of  grants  about  5                                                               
percent of  the fund's value a  year, to her belief,  to maintain                                                               
veterans' memorials  across the state  or to construct  new ones.                                                               
Donations  of  about $125,000  have  been  received from  private                                                               
corporations, and the  request [in HB 371] is  for $125,000 more.                                                               
She  said  $250,000  would  give  veterans'  organizations  about                                                               
$12,000 a  year, which  is sufficient  to maintain  the 78  or so                                                               
memorials   around   the   state,   to  the   belief   of   those                                                               
organizations.   She noted that  the Department of  Revenue could                                                               
answer more complicated questions.                                                                                              
                                                                                                                                
Number 1592                                                                                                                     
                                                                                                                                
REPRESENTATIVE   GREEN  referred   to   page   6  and   requested                                                               
clarification about how the credit works.                                                                                       
                                                                                                                                
Number 1530                                                                                                                     
                                                                                                                                
CHUCK  HARLAMERT,  Juneau  Section  Chief,  Central  Office,  Tax                                                               
Division, Department  of Revenue,  replied that  the contribution                                                               
can be  as much as  desired, but that  the credit received  is 50                                                               
percent  of the  first $100,000  and  100 percent  of the  second                                                               
[$100,000].   Therefore,  the  credit total  is  [$150,000].   In                                                               
response  to  a question  from  Chair  Chenault,  he said  it  is                                                               
generally on a calendar-year or tax-year basis.                                                                                 
                                                                                                                                
Number 1500                                                                                                                     
                                                                                                                                
REPRESENTATIVE MURKOWSKI surmised that the  $12,000 a year is the                                                               
5 percent "spin-off" from the $250,000 endowment.                                                                               
                                                                                                                                
MS. CARROLL acknowledged that as her own calculation.                                                                           
                                                                                                                                
REPRESENTATIVE MURKOWSKI recalled  testimony from [Pat] Carothers                                                               
at  a previous  hearing about  the shoestring  budget with  which                                                               
memorials  are  maintained  around  the state,  and  offered  her                                                               
recollection  that it  was one  or two  thousand dollars  a year.                                                               
She  said she  wasn't  suggesting  it should  be  that  low of  a                                                               
budget, but  that $12,000 seems  more than  [these organizations]                                                               
would know what  to do with annually, since  some [memorials] are                                                               
simple  plaques,  for  example.    She  asked  whether  the  full                                                               
$250,000 is necessary in the fund  in order to provide the needed                                                               
money on an annual basis.                                                                                                       
                                                                                                                                
Number 1309                                                                                                                     
                                                                                                                                
JOHN   JENKS,  Chief   Investment  Officer,   Treasury  Division,                                                               
Department  of  Revenue, said  he  wished  he could  answer  that                                                               
question and wished  that Mr. Carothers was  present; he recalled                                                               
hearing  Mr. Carothers  testify  that he  believed $12,500  would                                                               
allow  [the veteran's  organizations] to  do things  that haven't                                                               
been possible.   Mr. Jenks said the endowment proposed  in HB 371                                                               
could spin off  5 percent of its value each  year and effectively                                                               
protect the purchasing  power of the endowment over  time.  Every                                                               
$100,000  in the  endowment will  create approximately  $5,000 in                                                               
base  purchasing  power each  year,  forever,  to maintain  those                                                               
[memorials and monuments] and to build any new ones.                                                                            
                                                                                                                                
MS. CARROLL  acknowledged that some memorials  are small plaques,                                                               
but indicated  some of the  78 or so  are more substantial.   She                                                               
also  emphasized that  in addition  to maintenance,  this is  for                                                               
construction and  activities that  honor veterans; she  cited the                                                               
"moving wall" [in  honor of Vietnam War veterans]  as an example.                                                               
She said it doesn't seem $12,000 is very much.                                                                                  
                                                                                                                                
REPRESENTATIVE  MURKOWSKI agreed,  but  contrasted  it with  what                                                               
[veterans' organizations  have operated  on thus far  to maintain                                                               
memorials].                                                                                                                     
                                                                                                                                
MS. CARROLL  concurred, noting that  they've done  it voluntarily                                                               
or  through  gathering  bits  of  money  to  maintain  some,  but                                                               
certainly not all [of the memorials].                                                                                           
                                                                                                                                
CHAIR CHENAULT recalled testimony  from Mr. Carothers about being                                                               
able  to raise  a couple  of  thousand dollars,  for example,  to                                                               
provide upkeep.   Chair Chenault  said even though  [$12,000] may                                                               
be  a considerable  increase,  it may  or may  not  be enough  at                                                               
certain times.                                                                                                                  
                                                                                                                                
Number 1098                                                                                                                     
                                                                                                                                
REPRESENTATIVE KOTT  asked where the [$125,000  in contributions]                                                               
is maintained, and whether it earns interest.                                                                                   
                                                                                                                                
MS. CARROLL offered  her understanding that it's  currently "in a                                                               
nonprofit in  Southcentral," a location  she could find  out with                                                               
one phone call, but said she  didn't know about the interest.  In                                                               
response  to further  questions, she  indicated that  if it  came                                                               
into the state's  possession, it would go into  the general fund.                                                               
She  said [these  donations] appear  to have  come from  about 25                                                               
private-sector sources.                                                                                                         
                                                                                                                                
REPRESENTATIVE KOTT requested  confirmation that this legislation                                                               
wouldn't  affect  the  tax  liability   of  those  who'd  already                                                               
contributed.                                                                                                                    
                                                                                                                                
MS. CARROLL noted that the  bill has an immediate effective date,                                                               
but pointed out  that the individuals who made  the donations did                                                               
so knowing  that there was no  statute in place for  them to take                                                               
the credit.   She  again offered  to find  out where  the current                                                               
donations are being held.                                                                                                       
                                                                                                                                
Number 0905                                                                                                                     
                                                                                                                                
REPRESENTATIVE  MURKOWSKI   asked  whether  it  is   possible  to                                                               
retroactively provide a tax credit,  even though it now is beyond                                                               
the year when the contributions were made.                                                                                      
                                                                                                                                
REPRESENTATIVE  GREEN mentioned  the ability  to file  an amended                                                               
[tax] return.                                                                                                                   
                                                                                                                                
MR. HARLAMERT replied that it  technically could be possible.  He                                                               
surmised  that these  contributions  were made  in calendar  year                                                               
2001,  and said  an  Alaska corporate  tax  return, for  example,                                                               
probably wouldn't be filed until October [2002].  He added:                                                                     
                                                                                                                                
     You  could make  the argument,  although I  might argue                                                                    
     against it,  that ... they've made  a contribution, the                                                                    
     bill is  in effect, they're  filing a return  after the                                                                    
     bill  became  effective,  and the  bill  doesn't  state                                                                    
     either way  in particular whether they  could've or not                                                                    
     [taken] the credit.  And  you could argue that claiming                                                                    
     the credit now,  on a return filed  after the effective                                                                    
     date of  the bill, ...  because it's for  payments made                                                                    
     for a tax  year before the effective date  of the bill,                                                                    
     isn't relevant.   So  we might  have an  argument about                                                                    
     that.  I can't say ...  what our position might be.  It                                                                    
     might  be a  good idea  to  clarify that  in the  bill,                                                                    
     though.                                                                                                                    
                                                                                                                                
Number 0758                                                                                                                     
                                                                                                                                
CHAIR CHENAULT expressed curiosity about whether there have been                                                                
tax implications already [relating to the $125,000] from                                                                        
depositing [the contributions] into a nonprofit.                                                                                
                                                                                                                                
MR. HARLAMERT responded:                                                                                                        
                                                                                                                                
     That  may solve  our  problem right  there, because  if                                                                    
     they've contributed already, ...  then they're going to                                                                    
     get  a   charitable-contribution  deduction  federally.                                                                    
     But it didn't  go straight into the  fund; arguably, it                                                                    
     wouldn't qualify anyway for the credit.                                                                                    
                                                                                                                                
Number 0721                                                                                                                     
                                                                                                                                
REPRESENTATIVE KOTT  asked whether, if a  taxpayer contributed to                                                               
this  endowment fund,  there would  be  an opportunity  to get  a                                                               
write-off  for the  federal  tax liability,  in  addition to  the                                                               
credit proposed in the bill.                                                                                                    
                                                                                                                                
MR. HARLAMERT answered:                                                                                                         
                                                                                                                                
     They will take  ... a charitable-contribution deduction                                                                    
     on their  federal return.  They'll  also, however, have                                                                    
     their state income-tax deduction  reduced by the amount                                                                    
     of credit.  So the  net ... decrease in federal taxable                                                                    
     income  would be  $50,000 on  a $200,000  contribution,                                                                    
     for example,  and they would  save, say, 20  percent of                                                                    
     that, not the entire 200 [thousand dollars].                                                                               
                                                                                                                                
Number 0640                                                                                                                     
                                                                                                                                
REPRESENTATIVE  HAYES asked  how much  money is  brought in  from                                                               
veterans' license plates.   He suggested that might  be an avenue                                                               
to gain proceeds to help with the fiscal note.                                                                                  
                                                                                                                                
CHAIR CHENAULT responded  that it's a good question  and has been                                                               
an item  of discussion  previously, but  said he  didn't remember                                                               
the numbers.                                                                                                                    
                                                                                                                                
Number 0538                                                                                                                     
                                                                                                                                
REPRESENTATIVE KOTT moved to report  HB 371 out of committee with                                                               
individual recommendations  and the accompanying  fiscal note(s).                                                               
There  being no  objection, HB  371 was  reported from  the House                                                               
Special Committee on Military and Veterans' Affairs.                                                                            
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Special Committee  on Military and Veterans'  Affairs meeting was                                                               
adjourned at 4:53 p.m.                                                                                                          

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