Legislature(1995 - 1996)

02/28/1995 08:06 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
             HOUSE STATE AFFAIRS STANDING COMMITTEE                            
                       February 28, 1995                                       
                           8:06 a.m.                                           
 MEMBERS PRESENT                                                               
 Representative Jeannette James, Chair                                         
 Representative Scott Ogan, Vice-Chair                                         
 Representative Joe Green                                                      
 Representative Ivan                                                           
 Representative Brian Porter                                                   
 Representative Caren Robinson                                                 
 Representative Ed Willis                                                      
 MEMBERS ABSENT                                                                
 Representative Scott Ogan                                                     
 COMMITTEE CALENDAR                                                            
 *HB 173:  "An Act relating to reports by state agencies."                     
           PASSED OUT OF COMMITTEE                                             
 *SCR 4:   Naming the Poet Laureate of Alaska.                                 
           PASSED OUT OF COMMITTEE                                             
 *HJR 1:   Proposing an amendment to the Constitution of the State             
           of Alaska relating to repeal of regulations by the                  
           PASSED OUT OF COMMITTEE                                             
 *HB 89:   "An Act making a special appropriation to the principal             
           of the permanent fund; and providing for an effective               
           PASSED OUT OF COMMITTEE                                             
 *HCR 11:  Designating March 1995 as Sobriety Awareness Month,                 
           commonly referred to as "SAM."                                      
           PASSED OUT OF COMMITTEE                                             
 *HB 163:  "An Act requiring an agency to provide compliance cost              
           estimates for proposed regulations, amendments, and                 
           repeals of regulations under certain circumstance."                 
           HEARD AND HELD                                                      
 (* First public hearing)                                                      
 WITNESS REGISTER                                                              
 REPRESENTATIVE GARY DAVIS                                                     
 Alaska State Legislature                                                      
 State Capitol, Room 420                                                       
 Juneau, AK 99801                                                              
 Telephone:  (907) 465-2693                                                    
 POSITION STATEMENT:  Sponsor of HB 173                                        
 DANITH WATTS, Budget Analyst                                                  
 Office of Management and Budget                                               
 Office of the Governor                                                        
 240 Main Street, Suite 202                                                    
 Juneau, AK 99801                                                              
 Telephone:  (907) 465-4698                                                    
 POSITION STATEMENT:  Testified on HB 173                                      
 KRAG JOHNSEN, Intern                                                          
  for Senator Loren Leman                                                      
 Alaska State Legislature                                                      
 State Capitol, Room 113                                                       
 Juneau, AK 99801                                                              
 Telephone:  (907) 465-2095                                                    
 POSITION STATEMENT:  Provided Sponsor Statement for SCR 4                     
 KYLE PARKER, Legislative Assistant                                            
   to Representative Gail Phillips                                             
 Alaska State Legislature                                                      
 State Capitol, Room 208                                                       
 Juneau, AK 99801-1182                                                         
 Telephone:  (907) 465-2689                                                    
 POSITION STATEMENT:  Provided Sponsor Statement for HJR 1                     
 REPRESENTATIVE TERRY MARTIN                                                   
 Alaska State Legislature                                                      
 State Capitol, Room 502                                                       
 Juneau, AK 99801                                                              
 Telephone: (907) 465-3783                                                     
 POSITION STATEMENT: Sponsor of HB 89                                          
 DEBORAH OSTENDORF, Legislative Secretary                                      
   to Representative Irene Nicholai                                            
 Alaska State Legislature                                                      
 State Capitol, Room 501                                                       
 Juneau, AK 99801                                                              
 Telephone:  (907) 465-4527                                                    
 POSITION STATEMENT:  Provided Sponsor Statement for SCR 11                    
 ROD MOURANT, Administrative Assistant                                         
 Alaska State Legislature                                                      
 State Capitol, Room 432                                                       
 Juneau, AK 99801                                                              
 Telephone:  (907) 465-3777                                                    
 POSITION STATEMENT:  Testified on HB 163                                      
 ELMER LINDSTROM, Special Assistant                                            
 Office of the Commissioner                                                    
 Department of Health and Social Services                                      
 350 Main Street, Room 229                                                     
 PO Box 110601                                                                 
 Juneau, AK 99811-0601                                                         
 Telephone:  (907) 465-3030                                                    
 POSITION STATEMENT:  Testified on HB 163                                      
 PREVIOUS ACTION                                                               
 BILL:  HB 173                                                               
 SHORT TITLE: REPORTS TO THE LEGISLATURE                                       
 SPONSOR(S): REPRESENTATIVE(S) G.DAVIS, Navarre, Toohey,                       
 Finkelstein, Bunde, Rokeberg, Brown, James, Phillips, Kott                    
 JRN-DATE     JRN-PG                  ACTION                                   
 02/10/95       302    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/10/95       302    (H)   STATE AFFAIRS                                     
 02/13/95       343    (H)   COSPONSOR(S): TOOHEY, FINKELSTEIN,                
 02/13/95       343    (H)   COSPONSOR(S): ROKEBERG, BROWN                     
 02/15/95       396    (H)   COSPONSOR(S): JAMES                               
 02/23/95       469    (H)   COSPONSOR(S): PHILLIPS                            
 02/23/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 02/23/95              (H)   MINUTE(STA)                                       
 02/27/95       511    (H)   COSPONSOR(S): KOTT                                
 02/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  SCR 4                                                                
 SHORT TITLE: POET LAUREATE OF ALASKA                                          
 SPONSOR(S): SENATOR(S) LEMAN, Halford, Duncan, Zharoff, Taylor,               
             Green, Torgerson;                                                 
 REPRESENTATIVE(S) Toohey, Navarre                                             
 JRN-DATE     JRN-PG                  ACTION                                   
 01/20/95        58    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 01/20/95        58    (S)   STATE AFFAIRS                                     
 01/31/95              (S)   STA AT 03:30 PM BELTZ ROOM 211                    
 02/02/95              (S)   STA AT 03:30 PM BELTZ ROOM 211                    
 02/02/95              (S)   MINUTE(STA)                                       
 02/03/95       159    (S)   STA RPT  4DP                                      
 02/03/95       159    (S)   ZERO FISCAL NOTE (DOE)                            
 02/07/95              (S)   RLS AT 11:40 AM FAHRENKAMP ROOM 203               
 02/07/95              (S)   MINUTE(RLS)                                       
 02/09/95       219    (S)   RULES TO CALENDAR  2/9/95                         
 02/09/95       223    (S)   READ THE SECOND TIME                              
 02/09/95       223    (S)   COSPONSOR(S):  HALFORD, DUNCAN,                   
 02/09/95       223    (S)   TAYLOR, GREEN, TORGERSON                          
 02/09/95       223    (S)   PASSED Y19 N- E1                                  
 02/09/95       226    (S)   TRANSMITTED TO (H)                                
 02/10/95       290    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/10/95       290    (H)   STATE AFFAIRS                                     
 02/10/95       322    (H)   CROSS SPONSOR(S): TOOHEY, NAVARRE                 
 02/23/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 02/23/95              (H)   MINUTE(STA)                                       
 02/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  HJR  1                                                               
 SPONSOR(S): REPRESENTATIVE(S) PHILLIPS, Rokeberg, Brice, Green                
 JRN-DATE     JRN-PG                  ACTION                                   
 01/06/95        16    (H)   PREFILE RELEASED                                  
 01/16/95        16    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/16/95        16    (H)   STATE AFFAIRS, JUDICIARY                          
 01/18/95        73    (H)   COSPONSOR(S): GREEN                               
 02/07/95              (H)   MINUTE(ARR)                                       
 02/14/95              (H)   STA AT 08:00 AM CAPITOL 519                       
 02/14/95              (H)   MINUTE(STA)                                       
 02/23/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 02/23/95              (H)   MINUTE(STA)                                       
 02/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  HB 89                                                                
 SPONSOR(S): REPRESENTATIVE(S) MARTIN, James                                   
 JRN-DATE     JRN-PG                  ACTION                                   
 01/17/95        51    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/17/95        51    (H)   STATE AFFAIRS, JUDICIARY, FINANCE                 
 02/23/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 02/23/95              (H)   MINUTE(STA)                                       
 02/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  HCR 11                                                               
 SHORT TITLE: SOBRIETY AWARENESS MONTH: MARCH 1995                             
 SPONSOR(S): REPRESENTATIVE(S) NICHOLIA, Grussendorf, Robinson,                
             Navarre, Elton                                                    
 JRN-DATE     JRN-PG                  ACTION                                   
 02/15/95       368    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/15/95       369    (H)   STATE AFFAIRS                                     
 02/22/95       455    (H)   COSPONSOR(S): ELTON                               
 02/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  HB 163                                                               
 SPONSOR(S): REPRESENTATIVE(S) KOTT, Toohey, Kelly, MacLean                    
 JRN-DATE     JRN-PG                  ACTION                                   
 02/08/95       272    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/08/95       272    (H)   STA, FIN                                          
 02/22/95       456    (H)   COSPONSOR(S): KELLY, MACLEAN                      
 02/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 ACTION NARRATIVE                                                              
 TAPE 95-22 SIDE A                                                             
 Number 001                                                                    
 The State Affairs Committee meeting was called to order at 8:06               
 a.m. by Chair James.  Members present at the call to order were               
 Representatives Green, Porter, Robinson, Willis, Ivan and James.              
 CHAIR JEANNETTE JAMES said the record should reflect that                     
 Representatives Ivan and Ogan were at a Finance Subcommittee                  
 meeting for Fish and Game.  They told her they would be available             
 when needed.                                                                  
 HSTA - 02/28/95                                                               
 Number 024                                                                    
 REPRESENTATIVE GARY DAVIS came before the committee to present HB
 173, with fiscal notes, which he passed to committee members.  He             
 stated that it is a simple bill, and he thinks it is a better way.            
 Currently, every bill and every statute that comes before the                 
 legislature says that each agency, committee, or commission, or               
 department, will provide a copy of their annual report to the                 
 governor and legislature.  So, that is what they do. Representative           
 Davis thought it would be appropriate to notify the legislature               
 that a report is available, which will provide a reduction in the             
 material that flows through a legislator's office.  Currently,                
 state agencies are required by statute to prepare over one hundred            
 annual, biannual, and other reports for automatic submission to               
 every legislator, whether or not the legislator has a concern about           
 the report.  HB 173 will require state agencies to notify the                 
 legislature when reports are available.  This would cut costs.                
 Number 118                                                                    
 CHAIR JAMES asked why they didn't get a negative fiscal note.                 
 REPRESENTATIVE DAVIS said he did not know why.  He stated he had a            
 sheet on it, and also a copy of all the reports that state agencies           
 need to provide.  He felt there should be a negative fiscal note.             
 CHAIR JAMES also wondered how the copies of these reports would be            
 REPRESENTATIVE DAVIS visualized something like 15 or 20 copies of             
 the reports that they would keep available, and they can make more            
 as the supply is reduced.  There is a considerable amount of money            
 put out for printing, and he feels this legislation will reduce the           
 CHAIR JAMES added that some reports are very professionally done,             
 and a certain numbers would probably have to be printed each time.            
 Number 198                                                                    
 REPRESENTATIVE JOE GREEN said there are usually two or more costs             
 for printing.  There is a per-unit cost, which goes down as the               
 volume goes up.  If one thousand is the breaking point, then you              
 save money by printing more at one time.  If you guess short and              
 have to go back and reprint some copies, the cost will be                     
 considerably higher.                                                          
 REPRESENTATIVE DAVIS said some departments do things differently,             
 and costs vary.  For instance, Alaska Public Offices Commission,              
 Department of Administration, must prepare forms and manuals of               
 instruction for use by persons required to make reports under the             
 Campaign Disclosure, Conflict of Interest and Lobbying Laws.  The             
 completed forms are made available to the public.  The cost of                
 printing is $12,645.                                                          
 REPRESENTATATIVE CAREN ROBINSON expressed her support of HB 173,              
 but she suggested that, instead of the departments sending                    
 individuals a copy of their reports, they send a list of the                  
 available reports.  Legislators could recycle by distributing                 
 reports to libraries around their districts and communities.                  
 REPRESENTATIVE DAVIS thought her idea was good.  He said that would           
 not be a legal call, but rather a policy call.  It would not have             
 to be in statute.                                                             
 Number 271                                                                    
 REPRESENTATIVE JAMES added that reports should be put on computer             
 to reduce the amount of paper-packing.  With the technology today,            
 it is ridiculous that we have all this paper.  If the reports were            
 on computer they could be read on the screen, and, if desired,                
 printed out.                                                                  
 Number 313                                                                    
 DANITH WATTS, Budget Analyst, Office of Management and Budget,                
 Office of the Governor, testified on  HB 173, saying that the                 
 Governor's Office is "Certainly for the concept of less paper                 
 floating around."  She did not have a fiscal note because it is               
 very difficult at this point to calculate what the cost would be.             
 They know this legislation will not cost anything, which is why               
 they put the fiscal note at zero.  It could very well turn out to             
 be a negative fiscal note in the long run.                                    
 REPRESENTATIVE JAMES asked about the average number of copies that            
 our 60 legislators might print.  Ms. Watts could not give her a               
 figure; it would depend on the size and number of the reports.                
 Number 370                                                                    
 REPRESENTATIVE ED WILLIS moved to pass the bill out of committee              
 with individual recommendations.  There being no objection, it was            
 so moved.                                                                     
 HSTA - 02/28/95                                                               
 Number 390                                                                    
 SCR 4 - POET LAUREATE OF ALASKA                                             
 KRAG JOHNSEN, Intern from the University of Alaska Anchorage, was             
 there to represent Senator Leman who sponsored SCR 4.  This piece             
 of legislation, which establishes the Poet Laureate of Alaska, is             
 designed to act as a vehicle for confirming Mr. Thomas Sexton for             
 Poet Laureate of Alaska.  Mr. Sexton is a long-time Anchorage                 
 resident and a constituent of Senator Leman's.  Mr. Sexton received           
 his Masters Degree from the University of Alaska Anchorage, and               
 upon his graduation he spent 24 years as a professor there.  He               
 recently retired with the title of "Emeritus Professor of English."           
 His poetry has been published in journals across the U.S. and he              
 has been included in four anthologies.                                        
 REPRESENTATIVE PORTER said he was unfamiliar with the program and             
 asked wondered how it works.  He said he currently knows a person             
 who received Poet Laureate, and this person is now being replaced,            
 so this cannot be a lifetime appointment.                                     
 REPRESENTATIVE GREEN asked if Mr. Sexton is the only candidate and,           
 also, how a person becomes a candidate for Poet Laureate.                     
 MR. JOHNSEN explained that Poet Laureate is selected and nominated            
 on the basis of their talent, artistic excellence, and service to             
 the community.  He did not say if there were any other nominees.              
 In Mr. Sexton's case, he was nominated by the Alaska State Counsel            
 on the Arts.  The appointment is a two-year term, which is                    
 confirmed every new legislative session.  Senator Leman has set               
 forth SCR 4 to name Mr. Thomas Sexton as Poet Laureate of Alaska.             
 The legislature must confirm that appointment, for it is only                 
 through the legislative process that the Poet Laureate appointment            
 can be confirmed.                                                             
 REPRESENTATIVE WILLIS shared that the first Poet Laureate of Alaska           
 was a Chugiak resident, and she is the grandmother of his staff-              
 person, Bill Stoltz.                                                          
 REPRESENTATIVE PORTER made a motion to move SCR 4 out of committee.           
 There being no objections, the motion passed.                                 
 HSTA - 02/28/95                                                               
 Number 441                                                                    
 HJR 1 - REPEAL OF REGULATIONS BY LEGISLATURE                                
 KYLE PARKER, Legislative Assistant to Representative Gail Phillips,           
 came to testify on HJR 1.  He read the sponsor statement into the             
 "This Joint Resolution is a proposal to place a constitutional                
 amendment before the voters of the state of Alaska on the 1996                
 General Election ballot.  The amendment would permit the                      
 Legislature to repeal regulations promulgated by state agencies               
 that do not properly implement state statutes.                                
 "Many regulations do conform to and accurately implement the laws             
 passed by the legislature; however, there are an increasing number            
 of situations where regulations imposed on the citizens of the                
 state do not.  In many cases, legislative directives are ignored or           
 regulations are promulgated that go far beyond the scope of what              
 legislature intended.  As you know, once regulations go into                  
 effect, they have all the force and effect of law.  This is the               
 case even though regulations are promulgated by agency bureaucrats            
 who do not have to answer to the voters.                                      
 "The Alaska Constitution provides a system of checks and balances             
 among the three branches of government.  The people of Alaska have            
 their own check on government through the voting booth, the                   
 initiative process, and final authority over amendments to the                
 "However, one area that is beyond reasonable access to the people's           
 voice is the tremendous volume of administrative regulations that             
 are proposed by state agencies and written by attorneys at the                
 Department of Law.  These regulations affect every aspect of the              
 peoples' lives.  Yet the people are virtually powerless to change             
 them.  The constitution amendment proposed by HJR 1 would provide             
 the people a reasonable avenue to seek the repeal of improper                 
 "I recognize that this issue has been before the voters three                 
 different times and prior efforts to persuade the voters to support           
 similar amendments have failed.  Nevertheless, I believe that with            
 a better campaign presentation, clearer ballot language, and the              
 current popular support for regulatory reform, we can see this                
 constitutional amendment become a reality.  Now, more than ever,              
 Alaskans understand how regulations affect their daily lives and I            
 believe they will support this ballot proposition that brings state           
 regulations closer to the people. I urge your support of this                 
 important resolution."                                                        
 REPRESENTATIVE GREEN commented, saying if this is the case, and               
 there will be a notification and education of the public to get a             
 better knowledge, it will probably create a very positive attitude            
 among the voters.  He wondered if that should be reflected in the             
 fiscal note.                                                                  
 MR. PARKER stated that Senator Pearce introduced this bill last               
 year in the Senate.  He said Representatives Phillips and Pearce              
 have committed to making the education process happen.  The fiscal            
 note was not changed last year.  He was not certain how they                  
 envisioned carrying out the voter education.  Mr. Parker said the             
 last time this proposition was on the ballot was in 1986; since               
 then the concept of regulatory reform has been raised in the                  
 people's consciousness and, this being the case, it will be an                
 easier campaign.                                                              
 REPRESENTATIVE GREEN wanted to know what happens if a regulation is           
 adopted, which is based on a statute that has passed, but the                 
 regulation misses the mark.  He asked if the regulation would have            
 to be thrown out or if it would have to go back to the drafters.              
 MR. PARKER said the intent is if regulations are promulgated which            
 go beyond the intent of the enabling legislation, the legislature             
 can be petitioned to revisit and repeal certain provisions of the             
 REPRESENTATIVE JAMES stated there are things in the Constitution              
 that need statutes for implementing the regulations.  She suspects            
 the constitutional amendment, by itself, would not give as much               
 direction.  We need statutes to say how these things would happen.            
 Number 528                                                                    
 REPRESENTATIVE PORTER said it would be appropriate to put on record           
 the intent of this committee regarding this bill, which is that it            
 will not be required to annihilate a whole regulation in order to             
 remove one offensive sentence.                                                
 Number 575                                                                    
 REPRESENTATIVE ROBINSON asked if this legislation would be put in             
 the repertoire of bills dealing with regulation reform.                       
 CHAIR JAMES said this bill would be moved forward because anything            
 done, pertaining to regulation reform, would not be thwarted by               
 this bill passing or not passing.  The bottom line issues on                  
 regulation reform will be discussed in subcommittee.                          
 REPRESENTATIVE ROBINSON questioned how this would affect the                  
 separation of powers.                                                         
 MR. PARKER explained this goes to the point that Representative               
 Green brought up about how far the legislature can go in writing              
 regulations.  He hoped he was clear in what the intent is behind              
 the legislature being able to repeal.  They would not be in the               
 situation of rewording a sentence, they would be repealing the                
 sections.  That keeps them out of the regulatory writing process,             
 which is an executive branch function.  In protecting the                     
 legislative intent through this constitutional amendment, the                 
 legislature would have the power to go in and remove sections of              
 the regulations that offend the intent of the enabling legislation.           
 REPRESENTATIVE ROBINSON brought up the concealed weapon regulations           
 as an example.  The regulations have become law and are being                 
 implemented.  So, now, if we decide there is something we do not              
 like, she asked what the process would be to change it.                       
 MR. PARKER said it would be a resolution that would be passed by              
 both bodies of the legislature.  This constitutional amendment                
 would allow the legislature to appeal through a resolution.  It               
 would not be a bill.                                                          
 REPRESENTATIVE JAMES added that there is a statute on the books               
 that allows the legislature to annul regulation by resolution.                
 This was challenged in court and was determined to be in violation            
 of the constitution and the separation of powers.  There are                  
 certain procedures for making statutes or laws, all which are                 
 enumerated in the constitution.  The only way the legislature can             
 make law is through statute by the current system.  The Governor              
 should be able to veto everything the legislature does that affects           
 law.  He cannot veto regulations, however; so, if the legislature             
 were to make a law by resolution, the Governor would not have the             
 opportunity to veto it.  That is where the separation of powers               
 issue came about.                                                             
 REPRESENTATIVE ROBINSON asked if this bill would require a majority           
 CHAIR JAMES affirmed that it would require the majority vote.                 
 Actually, it would take a two-thirds vote to get out of the House.            
 It would need a majority vote of the public.  The language of this            
 bill does not explain how all these things will be done, and such             
 concerns ought to be put on the record if this is going to go                 
 forward.  We must have backup that supports exactly what it is that           
 we intend by this constitutional amendment.                                   
 Number 619                                                                    
 REPRESENTATIVE WILLIS said he concurs about the importance of                 
 putting everything on the record.  He recalled when he was in the             
 other body years ago when he co-chaired State Affairs, they had a             
 subcommittee that handled changing the motor vehicle law.  It took            
 about four years to do that, and after he was out of the                      
 legislature for almost ten years, a judge in Kenai called to ask              
 about the intent of a particular section of the bill from that                
 Number 633                                                                    
 REPRESENTATIVE JAMES suggested we make a provision in the statute             
 that sets a "sunset date" on regulations, and then by statute, the            
 legislature has the option of either extending the date or not.               
 That does not challenge the constitution, because the Governor has            
 the ability to veto it.  Representative James' legislation will               
 involve agencies, legislature and the public in the actual writing            
 of regulations.  Then it can be changed before it becomes final.              
 REPRESENTATIVE GREEN wanted to confirm, for the record, that the              
 intent of this resolution is that it will apply to existing                   
 regulations as well as to new ones.                                           
 REPRESENTATIVE JAMES assumed that if the legislature can veto                 
 regulations, they can veto any regulations.                                   
 REPRESENTATIVE GREEN moved that HJR 1 be passed from committee with           
 the attached fiscal note of $2,200, and with individual                       
 recommendations.  There being no objections, it was so moved.                 
 HSTA - 02/28/95                                                               
 HB 89 - APPROP:  TO PERMANENT FUND PRINCIPAL                                
 Number 672                                                                    
 REPRESENTATIVE TERRY MARTIN, Sponsor of HB 89, presented his                  
 sponsor statement to the committee, as follows:                               
 TAPE 95-22, SIDE B                                                            
 HB 89 is straightforward and very important.  The permanent fund              
 earnings reserve account was created by statute.  It is unto this             
 account that the balance of the Permanent Fund Corporation's net              
 income is deposited upon payment of dividends and inflation                   
 proofing.  The intent of the bill is to deposit the approximately             
 $1,146,000,000, as of June 30, 1995, into the corpus of the                   
 permanent fund, escalating the total to approximately                         
 $14,146,000,000.  He felt they should save this revenue in the most           
 secure account possible.  The permanent fund is untouchable by the            
 legislature, hence no special interests can infiltrate the fund and           
 Alaskans will prosper in the future with a solid savings account              
 yielding a return of almost nine percent this year.  If the                   
 earnings reserve is not appropriated to the permanent fund corpus             
 by July 1, 1995, there is a strong possibility the court may rule             
 that it to be used as partial payback to the constitutional budget            
 reserve (CBR).  From this account, it can easily be spent with a              
 simple majority of the House and Senate.                                      
 REPRESENTATIVE MARTIN said HB 89 is intended to send a message to             
 Alaska's public, that the legislature is willing and able to save             
 money for future generations.  While there are currently annual               
 projected budget deficits, this legislation makes the statement               
 that we are willing to deal with the situation through budgetary              
 reductions or other means, but certainly not by spending these                
 earnings - simply because they are there.                                     
 REPRESENTATIVE MARTIN told the committee that their support of this           
 legislation will send a signal to the voters that we, as a body,              
 recognize the fiscal crisis as well as the need to save for future            
 Number 063                                                                    
 REPRESENTATIVE MARTIN said this bill has to do with putting a large           
 amount of money into a permanent savings account.  The earnings of            
 the permanent fund must be spent before they can get into the                 
 Constitutional Budget Reserve account.  He voted to approve the CBR           
 when it came up in the legislature years ago, and was recently                
 asked if he would have approved the CBR had he known they would               
 have to redo the inflation proof every year, or, by court decree,             
 that money would have to go back, first, to pay the CBR off, which            
 we will never be able to do.                                                  
 REPRESENTATIVE MARTIN said in 1999, it is computed that all the               
 money that comes in the general revenue goes right to the CBR,                
 because it will be automatic by then.  If we were to pay the CBR              
 today, of $1.4 billion that owed, it means $2.8 billion is a new              
 account.  Representative Martin says the CBR is inoperative, it is            
 going to "be an albatross on the legislators, no matter who is in             
 charge of the neck."  Right now, his question was whether we should           
 save or put the money into CBR.   Some people say to take the                 
 "simple twenty-one" to spend it right now, then legislators can put           
 it in the permanent fund corpus, or we can use it for this year's             
 operation.  We are about $5.6 million short of new revenues coming            
 in.  Representative Martin said he thinks we should save the money.           
 This is not to be hard nosed about cutting the budget, but the idea           
 that this is the future generation's money as well as ours.  Once             
 the state gets to a $20 billion permanent fund corpus, the state              
 legislators will have more leeway of giving a generous amount in              
 dividends to the citizens, to inflation proof, and still have                 
 enough money for the new flow to the revenues.  Representative                
 Martin said he was glad that Chair James became co-sponsor of the             
 bill and urged the committee to get the bill off the table and save           
 for future generations.  The best solution is to put this money               
 away before we lose it all.  After July 1, of this year, we could             
 lose it all, if the court rules that it must go in as payback to              
 CHAIR JAMES asked if there were any questions.  There being no                
 further questions, she said the problem she had with the CBR is the           
 three-quarter vote.  Representative Martin spoke once before about            
 the minority being in control, and Chair James said that a three-             
 quarter vote is a minority vote. It puts the minority in charge.              
 Of course, it is always presumed that the majority ought to be in             
 charge.  Chair James said she supports this legislation because she           
 is unwilling to take the earnings reserve of the Permanent Fund,              
 which is the excess earnings over and above the Permanent Fund                
 Dividend Program and the inflation proofing, and then require only            
 a minority vote for it to be spent.  Also, because the earning                
 reserve of the permanent fund is located in the permanent fund, as            
 opposed to in the general fund, and managed much the same as the              
 rest of the permanent fund dividend is, the people consider it part           
 of the permanent fund.  It is her feeling, therefore, that the                
 legislature should make sure it is part of the permanent fund.  The           
 way to make it a certainty is to appropriate it to the permanent              
 fund.  The other option would be to allow this money to be spent              
 with the three-quarter vote, or put it somewhere where it cannot be           
 spent with any vote, except by the vote of the people.  She said              
 she supports that concept.                                                    
 REPRESENTATIVE PORTER agreed with Representative James, and wanted            
 to add that another reason it should get off the table is that the            
 appointed or soon to be appointed long range budget commission and            
 the legislature, has to make some tough decisions while looking               
 forward to our financial situation.  Those decisions can be made              
 sooner with this money off the table.                                         
 Number 109                                                                    
 REPRESENTATIVE PORTER moved to pass HB 89 out of committee, and               
 there being no objections, the bill was so moved.                             
 HSTA - 02/28/95                                                               
 Number 129                                                                    
 HCR 11 - SOBRIETY AWARENESS MONTH, MARCH                                    
 DEBORAH OSTENDORF, Legislative Aide for Representative Irene                  
 Nicholia, came before the committee to testify on HCR 11.  Ms.                
 Ostendorf noted that HCR 11 designates the month of March as                  
 Sobriety Awareness Month.  The Alaska Federation of Natives (AFN)             
 wants to have the state to recognize those individuals who have               
 pledged themselves to sobriety.  If this resolution passes in a               
 timely manner, AFN would like to have the resolution, along with              
 the Governor's Proclamation and signatures of thousands of people             
 from around the state who pledged themselves to sobriety, to be               
 taken up the Iditarod Trail, which beings Sunday, March 5.                    
 REPRESENTATIVE BRIAN PORTER told the committee that last year, he             
 had the pleasure of chairing an alcohol task force of the House.              
 It gave him the opportunity to go around the state taking testimony           
 pertaining to the substance abuse problem in Alaska.  Of all of the           
 approaches he knows of to deal with this seemingly insurmountable             
 problem, this, he believes, is the best.  He supports it                      
 REPRESENTATIVE CAREN ROBINSON moved that HCR 11 be passed out of              
 committee with individual recommendations a zero fiscal note.                 
 There being no objection, the motion passed.                                  
 HSTA - 02/28/95                                                               
 Number 191                                                                    
 HB 163 - COMPLIANCE ESTIMATE COST REQUIREMENTS                              
 ROD MOURANT, Administrative Assistant to Representative Pete Kott,            
 came before the committee to present HB 163.  This legislation                
 would require an agency, when they are proposing new regulations,             
 to present a cost compliance estimate with those regulations.                 
 Currently, when regulations are drafted, an agency completes a                
 fiscal note on the cost of the regulation process, but no cost                
 compliance estimate is prepared for a private sector impact.  The             
 committee member's packets includes a letter from the National                
 Federation of Independent Businesses (NFIB) supporting this                   
 concept.  Eighty-three percent of their members support the                   
 concept.  The original concept of this legislation was included in            
 the 1995 Alaska Minerals Commission Report, as recommendation                 
 number four.  The mining industry experiences the frustration of              
 regulation without consideration of cost to the industry.  Mr.                
 Mourant said they have fiscal notes from all except for five                  
 agencies.  The fiscal notes vary from zero to $178,000, the latter            
 being from the Department of Environmental Conservation.  This is             
 for merely preparing the cost estimate for compliance with any                
 regulation, not for compliance with regulation.                               
 REPRESENTATIVE GREEN liked the concept, but wondered if it would be           
 possible for an individual to get a meaningful or accurate cost               
 estimate regarding whatever regulation was being proposed.                    
 Number 261                                                                    
 MR. MOURANT answered that when an agency drafts regulations based             
 on statute adopted by legislation signed into law, they determine             
 who the constituency is first.  Then they fashion the regulation to           
 comply with the statute they are interpreting.  At that time they             
 should have an estimated idea of what the cost will be, for                   
 instance, the filing of a new tax forms, or the requirement to                
 build a new ramp of access for handicapped persons.  This, of                 
 course, only deals with the adoption of regulations, or the repeal            
 of regulations.                                                               
 Number 274                                                                    
 REPRESENTATIVE PORTER followed up by saying he presumed this would            
 force the agency to contact the affected people and get their                 
 estimate of these costs.                                                      
 MR. MOURANT agreed that it would certainly urge the agencies to               
 talk with the affected constituency about the impact of the                   
 proposed legislation, or how the private industry interprets the              
 proposed legislation.                                                         
 Number 280                                                                    
 CHAIR JAMES said she thought that evaluating the cost to our                  
 economy would be valuable, and also measuring what the cost benefit           
 will be.  They should be sure that what they do is worth the cost.            
 Chair James wondered how specific they needed to be, because every            
 time someone does "a finding," or does a report that backs up what            
 they do, they must also create evidence for a lawsuit, in case                
 someone doesn't like it.  She liked the concept, but thought they             
 should avoid being too specific and, thereby, try to do the                   
 lawyer's job for them.  She said they also need to get a negative             
 fiscal note on this bill.                                                     
 REPRESENTATIVE WILLIS wondered if this was in place in Florida and            
 if Mr. Mourant heard any feedback.                                            
 CHAIR JAMES referred him to a research report from Florida,                   
 provided to them by the sponsor.  A point made in the report was              
 that they determined they needed that legislation, and they went so           
 far as to require an Environmental Impact Statement (EIS), which is           
 very costly.                                                                  
 CHAIR JAMES noted, for the record, that Representative Ivan was               
 Number 340                                                                    
 ELMER LINDSTROM, Special Assistant to the Commissioner, Department            
 of Health and Social Services, said he was not at the meeting to              
 speak for the Administration, but he had some conversations with              
 colleagues in other departments and said his agency is one that               
 submitted a zero fiscal note.  They viewed it in relationship with            
 other regulation bills on the table, specifically HB 130.  It                 
 required an economic or detailed analysis, which they regarded as             
 something that would require additional expertise and costs in                
 their department, so, consequently, they viewed HB 163 as less                
 costly.  Some agencies looked at HB 163 and did not see the phrase            
 "cost estimate" as self-defining, and thus regard it as being                 
 similar to the language in HB 130 that would require an economic              
 analysis.  The Executive Branch would need some guidance from the             
 committee about what the intent of this is, and about the meaning             
 of "cost estimate."                                                           
 Number 361                                                                    
 CHAIR JAMES mentioned receiving a package pertaining to regulations           
 on subsistence living, and legislation that they passed last year.            
 It was the Department of Administration and the Department of                 
 Health and Social Services regulations that covers both.  She                 
 wanted to do an evaluation of those regulations and the statute to            
 see how much duplication there is from the regulation to the                  
 statute.  She is still looking for ways to streamline the process.            
 Chair James feels if they saw the regulations before the they                 
 passed a statute, they might take another look at whether to do it.           
 They need to think more thoroughly about what they are creating               
 when they create these bills, and "take the blame" for the cost of            
 implementing them.                                                            
 Number 395                                                                    
 MR. LINDSTROM said he also read the regulations and he recalled               
 that there were about 50 pages.  Most of the verbiage relates to              
 licensing of homes and so forth.  When you get into licensing, it             
 is tricky.                                                                    
 Number 401                                                                    
 REPRESENTATIVE PORTER asked what the cost of the regulation would             
 be to the person who wants to be in a certain businesses.                     
 CHAIR JAMES said each agency has its own uniqueness in the kind of            
 regulations they have.  The Florida research report shows that the            
 legislature made various levels of regulations, and refined it to             
 say that some didn't need it, and some needed it more extensively.            
 The decision had to be made about whether or not it was even                  
 necessary.  Some regulations didn't apply.  She thinks they should            
 determine just how much policy should be in regulations.  Her idea            
 is that they ought to slim down the policy in the regulations.  It            
 is easier to change or slim down policy than to change or slim down           
 CHAIR JAMES said if there were no more questions or comments they             
 would put HB 163 with the other bills in the Regulation Review                
 Committee.  She stated that the committee has cleaned up all the              
 bills, except for HB 81 on preventative maintenance.  However, next           
 Thursday she said we will use the next meeting time for the                   
 subcommittee on regulation reform.                                            
 The meeting was adjourned at 9:20 a.m.                                        

Document Name Date/Time Subjects