Legislature(1997 - 1998)

03/27/1997 08:04 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
             HOUSE STATE AFFAIRS STANDING COMMITTEE                            
                         March 27, 1997                                        
                            8:04 a.m.                                          
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Jeannette James, Chair                                         
 Representative Ethan Berkowitz                                                
 Representative Fred Dyson                                                     
 Representative Kim Elton                                                      
 Representative Mark Hodgins                                                   
 Representative Ivan Ivan                                                      
 Representative Al Vezey                                                       
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 All members present.                                                          
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 HOUSE BILL NO. 67                                                             
 "An Act relating, for purposes of eligibility for a permanent fund            
 dividend, to an absence from the state while on an unpaid                     
 sabbatical under the longevity bonus program; and providing for an            
 effective date."                                                              
                                                                               
      - MOVED CSHB 67(STA) OUT OF COMMITTEE                                    
                                                                               
 HOUSE BILL NO. 143                                                            
 "An Act relating to the art in public places requirements for                 
 state-owned and state-leased buildings and facilities."                       
                                                                               
      - MOVED HB 143 OUT OF COMMITTEE                                          
                                                                               
 HOUSE BILL NO. 81                                                             
 "An Act relating to the members of the board and staff of the                 
 Alaska Permanent Fund Corporation."                                           
                                                                               
      - SCHEDULED BUT NOT HEARD                                                
 (* First public hearing)                                                      
                                                                               
 PREVIOUS ACTION                                                               
                                                                               
 BILL:  HB  67                                                               
 SHORT TITLE: LONGEVITY BONUS SABB'TCL:PFD ELIGIBILITY                         
 SPONSOR(S): REPRESENTATIVE(S) RYAN                                            
                                                                               
 JRN-DATE      JRN-PG             ACTION                                       
 01/15/97        66    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 01/15/97        67    (H)   STATE AFFAIRS, LABOR & COMMERCE, FIN              
 02/25/97              (H)   STA AT  8:00 AM CAPITOL 102                       
 02/25/97              (H)   MINUTE(STA)                                       
 03/27/97              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 BILL:  HB 143                                                               
 SHORT TITLE: REPEAL ART IN PUBLIC PLACES REQUIREMENT                          
 SPONSOR(S): REPRESENTATIVE(S) VEZEY, Hodgins                                  
                                                                               
 JRN-DATE      JRN-PG             ACTION                                       
 02/17/97       374    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/17/97       375    (H)   STATE AFFAIRS                                     
 03/20/97              (H)   STA AT  8:00 AM CAPITOL 102                       
 03/20/97              (H)   MINUTE(STA)                                       
 03/22/97              (H)   STA AT 10:00 AM CAPITOL 102                       
 03/25/97       841    (H)   COSPONSOR(S): HODGINS                             
 03/27/97              (H)   STA AT  8:00 AM CAPITOL 102                       
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 REPRESENTATIVE JOE RYAN                                                       
 Alaska State Legislature                                                      
 State Capitol, Room 420                                                       
 Juneau, Alaska 99801-1182                                                     
 Telephone:  (907) 465-3875                                                    
 POSITION STATEMENT:  Sponsor of HB 67.                                        
                                                                               
 NANCI A. JONES, Director                                                      
 Permanent Fund Dividend Division                                              
 Department of Revenue                                                         
 P.O. Box 110460                                                               
 Juneau, Alaska 99811-0460                                                     
 Telephone:  (907) 465-2323                                                    
 POSITION STATEMENT:  Provided testimony on HB 67.                             
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 97-35, SIDE A                                                            
 Number 0001                                                                   
                                                                               
 The House State Affairs Standing Committee was called to order by             
 Chair Jeannette James at 8:04 a.m.  Members present at the call to            
 order were Representatives James, Berkowitz, Dyson, Elton, Ivan and           
 Vezey.  Members absent were Hodgins.  Representative Mark Hodgins             
 arrived at 8:20 a.m.                                                          
                                                                               
 HB 67 - LONGEVITY BONUS SABB'TCL:PFD ELIGIBILITY                            
                                                                               
 The first order of business to come before the House State Affairs            
 Standing Committee was HB 67, "An Act relating, for purposes of               
 eligibility for a permanent fund dividend, to an absence from the             
 state while on an unpaid sabbatical under the longevity bonus                 
 program; and providing for an effective date."                                
                                                                               
 CHAIR JEANNETTE JAMES called on Representative Joe Ryan, sponsor of           
 HB 67, to present the bill.                                                   
                                                                               
 Number 0054                                                                   
                                                                               
 REPRESENTATIVE JOE RYAN, Alaska State Legislature, explained HB 67            
 allowed an exception for folks who were taking an unpaid sabbatical           
 to retain their eligibility for the permanent fund check.  A                  
 sabbatical could only be taken once every five years.  There were             
 only 139 people who had taken advantage of it.  "We actually save             
 money on this thing because for the time they're on a sabbatical              
 they don't get their longevity bonuses."  They retain their                   
 eligibility for their longevity bonus when they return, however.              
 The exception in HB 67 allowed for them to retain their eligibility           
 for their permanent fund checks so that they were not penalized               
 twice.  This small concession was the least that the state could do           
 for them.                                                                     
                                                                               
 Number 0209                                                                   
                                                                               
 REPRESENTATIVE AL VEZEY asked somebody to explain an "unpaid                  
 sabbatical".                                                                  
                                                                               
 Number 0219                                                                   
                                                                               
 REPRESENTATIVE RYAN replied people were allowed to leave the state            
 once every five years for certain purposes while not losing their             
 eligibility for the permanent fund check.                                     
                                                                               
 Number 0281                                                                   
                                                                               
 CHAIR JAMES explained - generally - it was time off from work with            
 pay.  In the beginning it had a religious connotation, but had                
 transcended into time off to do something entirely different for              
 one year.                                                                     
                                                                               
 Number 0375                                                                   
                                                                               
 REPRESENTATIVE RYAN explained it allowed for seniors, who had                 
 stayed in Alaska for a long period of time withstanding the                   
 hardships of Alaska, to go outside and travel without being                   
 penalized by losing their longevity bonuses.  For many, the                   
 longevity bonus was a substantial part of their retirement income.            
 "I don't think it's an undue hardship on the state to allow these             
 people to enjoy some time in their later years to do some of the              
 things that they worked very hard for."                                       
                                                                               
 Number 0443                                                                   
                                                                               
 REPRESENTATIVE KIM ELTON stated in this context an unpaid                     
 sabbatical meant a long vacation.  The difference was that a person           
 could reestablish his or her eligibility for the permanent fund               
 dividend program; whereas, a person would loose his or her                    
 eligibility forever for the longevity bonus program.                          
                                                                               
 Number 0496                                                                   
                                                                               
 REPRESENTATIVE RYAN replied there was an exception made for the               
 sabbatical.  Seniors would retain their eligibility for the                   
 longevity bonus program, but they would lose it for the time that             
 they were absent.  The state, therefore, was saving money because             
 the longevity bonus came out of the General Fund.  So, we were                
 saving money on one hand and just allowing for the participation in           
 the permanent fund program on the other hand.                                 
                                                                               
 Number 0556                                                                   
                                                                               
 NANCI A. JONES, Director, Permanent Fund Dividend Division,                   
 Department of Revenue, was the first person to testify in Juneau.             
 The division would like to offer an alternative to HB 67.                     
 Currently, a person taking a sabbatical, depending on when he or              
 she left, would not disqualify for the permanent fund dividend.               
 The regulations allowed for 180 days of absence in one calendar               
 year.  Therefore, if a person straddled a year; for example, six              
 months of absence in one year, he or she would not lose eligibility           
 for a dividend check.  As an alternative, the division could by               
 regulation or statute ensure that a person would not lose                     
 eligibility in the second year, if he or she chose not to straddle            
 a year.  For example, if a person was gone an entire calendar year,           
 he or she would not be eligible for the first dividend and because            
 he was not in the state prior to the new qualifying year he would             
 also miss eligibility for the second dividend.  By addressing this            
 through regulation, it put both programs on equal footing.                    
 Moreover, there were 29,733 people who received at least one                  
 longevity bonus last year.  The bill would segregate these people             
 by creating an elite group.                                                   
                                                                               
 Number 0730                                                                   
                                                                               
 CHAIR JAMES wondered if HB 67 would allow for the 29,733 people Ms.           
 Jones referenced to receive their permanent fund dividend check.              
 How would they affect the longevity bonus program negatively?                 
                                                                               
 Number 0781                                                                   
                                                                               
 MS. JONES replied it was an impact on the differences between the             
 permanent fund dividend and the longevity bonus program.  She was             
 not inferring that the bill would impact the longevity bonus                  
 program.                                                                      
                                                                               
 Number 0795                                                                   
 CHAIR JAMES asked Representative Ryan if the 139 people he                    
 referenced earlier had already taken their sabbaticals since                  
 passing the bill last year?                                                   
                                                                               
 Number 0808                                                                   
                                                                               
 REPRESENTATIVE RYAN replied the 139 people were either taking                 
 advantage of the opportunity, or who would take advantage of the              
 opportunity.  In addition, these were older people so the numbers             
 would change due to the natural attrition rate of death, for                  
 example.                                                                      
                                                                               
 Number 0829                                                                   
                                                                               
 CHAIR JAMES stated there would be 139 more people who would receive           
 a permanent fund dividend check under HB 67 than otherwise.                   
                                                                               
 MS. JONES replied, "Correct."  But only if they were not gone more            
 than 180 days in one calendar year.                                           
                                                                               
 Number 0859                                                                   
                                                                               
 CHAIR JAMES stated if they were gone more than 365 days the whole             
 thing did not apply to them.                                                  
                                                                               
 CHAIR JAMES further stated the alternative, according to Ms. Jones,           
 was to ensure by statute or regulation that a person would not lose           
 eligibility in the second year; however, there was no protection              
 for the first year.  She asked Ms. Jones how the first year would             
 be protected?                                                                 
                                                                               
 Number 0952                                                                   
                                                                               
 MS. JONES replied to be on equal footing with the longevity bonus             
 program they would not be eligible the year that they took their              
 sabbatical.  But, they would be eligible upon return for the second           
 year.                                                                         
                                                                               
 Number 0980                                                                   
                                                                               
 CHAIR JAMES stated that was less of a deal than what HB 67 was                
 asking for.  House Bill 67 asked for no cessation of the permanent            
 fund dividend while a person was gone.                                        
                                                                               
 Number 0996                                                                   
                                                                               
 REPRESENTATIVE ELTON stated, under the current rules, a person                
 could be gone from July 15, 1997 to June 15, 1998; still receive a            
 dividend for this year and next year; and still be able to take two           
 weeks of vacation in each of the two years.                                   
                                                                               
 MS. JONES replied, "Correct."                                                 
 REPRESENTATIVE ELTON asked Ms. Jones if he took a two year                    
 sabbatical, for example, would he still be covered?  There did not            
 appear to be a time-frame involved.                                           
                                                                               
 Number 0996                                                                   
                                                                               
 MS. JONES replied the sabbatical was a 12-month program.                      
                                                                               
 Number 1065                                                                   
                                                                               
 REPRESENTATIVE VEZEY wondered how the Governor's bill that put a              
 ceiling on income for recipients of the longevity bonus would                 
 affect those who would not be taking a sabbatical leave.                      
                                                                               
 Number 1124                                                                   
                                                                               
 MS. JONES responded that as long as they were not absent there                
 would not be a problem with their dividend.                                   
                                                                               
 Number 1143                                                                   
                                                                               
 REPRESENTATIVE VEZEY asked Ms. Jones if they would be eligible to             
 take a sabbatical leave because their incomes were too high?                  
                                                                               
 MS. JONES replied, "No."   The only sabbatical that the permanent             
 fund dividend program recognized was from the university system               
 statewide.                                                                    
                                                                               
 REPRESENTATIVE VEZEY asked Ms. Jones if that was provided for in              
 statute?                                                                      
                                                                               
 MS. JONES replied, "Yes."                                                     
                                                                               
 Number 1166                                                                   
                                                                               
 REPRESENTATIVE ETHAN BERKOWITZ wondered if a person would still be            
 eligible under HB 67 to take a permanent fund sabbatical if a                 
 person's income was outside of the cap proposed by the Governor.              
                                                                               
 Number 1198                                                                   
                                                                               
 CHAIR JAMES replied the disallowance would have to be included in             
 the second piece of legislation; otherwise, there would be a                  
 conflict.  House Bill 67 referred to those who qualified for a                
 longevity bonus and if something else would supersede that                    
 qualification then it should be referenced.                                   
                                                                               
 Number 1251                                                                   
                                                                               
 REPRESENTATIVE RYAN stated the exemption was under AS 47.45.030.              
 If a person did not qualify as a result of a subsequent piece of              
 legislation for the longevity bonus sabbatical, then it would not             
 apply and there would be nothing to lose.  Under As 47.45.030, a              
 person could be gone for a whole year, but he or she would have to            
 give up the longevity bonus while retaining eligibility for the               
 permanent fund dividend upon return.  If a person did not have a              
 longevity bonus to give up then he or she would not qualify for the           
 sabbatical.                                                                   
                                                                               
 Number 1287                                                                   
                                                                               
 CHAIR JAMES said everyone had a different view of who the                     
 recipients of the longevity bonus were:  seniors in the Pioneer               
 Homes, seniors who gathered at senior centers, and seniors who were           
 still working.  Therefore, sabbatical for some would be a choice              
 and for others it would be an assignment.  In addition, in-light-of           
 the Governor's bill, there was an argument that those who were                
 working did not need the permanent fund dividend or a sabbatical.             
 In summary, she did not know how she felt about the issue.  She               
 mentioned she had a conflict of interest because she was a                    
 recipient of the longevity bonus.  She did see the merits of the              
 bill, however.                                                                
                                                                               
 Number 1470                                                                   
                                                                               
 REPRESENTATIVE RYAN explained, as a scenario, there were very few             
 people in Alaskan who had an extended family here because most of             
 us were from somewhere else.  In addition, our children lived                 
 outside because of the lack of employment opportunities in Alaska.            
 The sabbatical provision, therefore, gave the seniors an                      
 opportunity to renew family relations outside of Alaska with their            
 children and grandchildren.  It also allowed for them to tie up               
 their loose ends before their time came without being penalized.              
 That was what the original longevity bonus exemption was for.  "I             
 thought that this would be more of an effort to help those folks              
 because traditionally older folks did not have a lot of money to do           
 these things."                                                                
                                                                               
 Number 1525                                                                   
                                                                               
 REPRESENTATIVE ELTON stated the provision only allowed for the                
 longevity recipients which was a diminishing pool of people.                  
 Therefore, there would be those seniors in time who would not be              
 able to visit their grandchildren on a sabbatical without losing              
 their permanent fund dividend.                                                
                                                                               
 Number 1555                                                                   
                                                                               
 CHAIR JAMES replied, "Correct."  That was the way the bill was                
 written.                                                                      
                                                                               
 Number 1561                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ wondered if the longevity bonus problem              
 could be side stepped if the language in AS 47.45.035 was adopted.            
 If the intent was to ensure that Alaska's seniors could take a                
 sabbatical while retaining their permanent fund eligibility, there            
 was no reason to relate it to the receipt of the longevity bonus.             
                                                                               
 Number 1595                                                                   
                                                                               
 CHAIR JAMES replied that was an option.  She was not sure if                  
 Representative Ryan intended to open the bill up that big, however.           
                                                                               
 Number 1603                                                                   
                                                                               
 REPRESENTATIVE RYAN stated he had not planned at this time to offer           
 that opportunity.  "I just thought that since these people were               
 giving up one thing, we wouldn't double their penalties."  It was             
 a good subject for another bill, but he did not want to include it            
 in HB 67; it would be a difficult proposition to sell.                        
                                                                               
 Number 1639                                                                   
                                                                               
 CHAIR JAMES stated there was an assumption that longevity bonus               
 recipients had been in Alaska longer than others.  In 1992, 40                
 percent of the recipients had not been in the state for more than             
 3 years.  However, now that it was phased out and the longer that             
 it went by, it meant that those people had been in Alaska longer              
 than just anybody who qualified for a permanent fund.                         
                                                                               
 Number 1664                                                                   
                                                                               
 REPRESENTATIVE MARK HODGINS moved that HB 67 move from the                    
 committee with individual recommendations and the attached fiscal             
 note(s).                                                                      
                                                                               
 Number 1676                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ objected for discussion purposes.                    
                                                                               
 REPRESENTATIVE BERKOWITZ stated he was unclear if there had been              
 any modification of the concerns raised about attaching eligibility           
 to the receipt of the longevity bonus.  He wanted to be sure that             
 people retained their ability to collect on the permanent fund                
 dividend even if their ability for the longevity bonus was                    
 challenged through the Governor's bill.  In his district, there               
 were a lot of seniors who qualified for the longevity bonus.  He              
 did not want it so that they did not receive their permanent fund             
 as well because they took a sabbatical.                                       
                                                                               
 Number 1719                                                                   
                                                                               
 CHAIR JAMES stated she was concerned about opening the provision up           
 broadly.  She was also concerned about creating a benefit for                 
 newcomers.  She did not know how to identify them without including           
 the newcomers, however.                                                       
                                                                               
 REPRESENTATIVE BERKOWITZ stated a time limit could be included.               
 Otherwise, the Governor's bill would disqualify people in the                 
 future.                                                                       
                                                                               
 Number 1780                                                                   
                                                                               
 REPRESENTATIVE RYAN responded the thrust of the bill was quid pro             
 quo.  "You give up your longevity bonus but we will help you retain           
 your permanent fund eligibility."  He did not intend to open the              
 subject up for everybody.  The merits were fine, but he did not               
 want to go that far in HB 67.                                                 
                                                                               
 Number 1810                                                                   
                                                                               
 CHAIR JAMES asked Representative Berkowitz if he was offering a               
 conceptual amendment?                                                         
                                                                               
 Number 1816                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ explained he did not want to expand the              
 universe of those who would be eligible today under HB 67.                    
 However, tomorrow a different contingency could shrink the universe           
 through means testing.  For example, "My feeling is people who get            
 means tested out of a longevity bonus have already made a sacrifice           
 and for them to stand by and watch while their friends go on a                
 sabbatical and still retain their permanent fund eligibility while            
 they're unable to do so.  The equal protection specter was much               
 stronger in the situation that I have described than it is                    
 currently where there are people who are not even eligible for the            
 longevity bonus as opposed to people who would be eligible but they           
 made too much money."                                                         
                                                                               
 Number 1868                                                                   
                                                                               
 CHAIR JAMES asked the committee members if they understood the                
 discussion on the conceptual amendment?  She explained it would               
 include all of the people who currently qualified for the longevity           
 bonus and an effective date.                                                  
                                                                               
 Number 1889                                                                   
                                                                               
 REPRESENTATIVE RYAN stated we have this issue before us now.  We              
 did not know what would happen to the Governor's bill.  He                    
 suggested taking the issues one at a time.  He reiterated the                 
 sabbatical was established so that individuals would lose                     
 something.  Therefore, if they were ruled out by the Governor's               
 bill they would have nothing to lose.  There would not be a reason            
 to give them a permanent fund dividend because they had already               
 lost their longevity bonus through means testing.                             
                                                                               
 Number 1919                                                                   
                                                                               
 CHAIR JAMES stated she understood the concerns of Representative              
 Ryan, but a member of the House State Affairs Standing Committee              
 had offered a conceptual amendment so it was up to the committee              
 members now.                                                                  
                                                                               
 Number 1928                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ moved the conceptual amendment to include            
 the following language:                                                       
                                                                               
 "Those who qualify for the longevity bonus as of January 1, 1997              
 would as of that date be eligible for an unpaid sabbatical."                  
                                                                               
 CHAIR JAMES asked the committee members if they understood the                
 conceptual amendment offered by Representative Berkowitz?                     
                                                                               
 Number 1946                                                                   
                                                                               
 REPRESENTATIVE IVAN IVAN asked Representative Berkowitz to run that           
 by him again.                                                                 
                                                                               
 CHAIR JAMES replied HB 67 would enable seniors to not lose their              
 permanent fund dividend eligibility while they were on an unpaid              
 sabbatical under the longevity bonus program.  The conceptual                 
 amendment would qualify those as of January 1, 1997, to prevent a             
 subsequent bill from denying them for another reason from getting             
 their longevity bonus and permanent fund dividend if they went on             
 a sabbatical.                                                                 
                                                                               
 CHAIR JAMES asked if there was any objection to the conceptual                
 amendment?                                                                    
                                                                               
 Number 2004                                                                   
                                                                               
 REPRESENTATIVE HODGINS objected.  A roll call vote was taken.                 
 Representatives James, Berkowitz, Dyson, Elton, Ivan and Vezey                
 voted in favor of the motion.  Representative Hodgins voted against           
 the motion.  The conceptual amendment was accepted.                           
                                                                               
 CHAIR JAMES asked if there was an objection to moving the bill from           
 the committee as amended?  There was no objection, CSHB 67(STA) was           
 so moved from the House State Affairs Standing Committee.                     
                                                                               
 HB 143 - REPEAL ART IN PUBLIC PLACES REQUIREMENT                            
                                                                               
 The next order of business to come before the House State Affairs             
 Standing Committee was HB 143, "An Act relating to the art in                 
 public places requirements for state-owned and state-leased                   
 buildings and facilities."                                                    
 CHAIR JAMES called on Representative Vezey, sponsor of HB 143, to             
 present the bill.                                                             
                                                                               
 Number 2068                                                                   
                                                                               
 REPRESENTATIVE VEZEY said he did not have any further comments to             
 make on HB 143.  The committee had debated the bill and there had             
 been public testimony.                                                        
                                                                               
 Number 2074                                                                   
                                                                               
 REPRESENTATIVE VEZEY moved that HB 143 move from the committee with           
 individual recommendations and the attached fiscal note(s).                   
                                                                               
 Number 2079                                                                   
                                                                               
 REPRESENTATIVE ELTON objected.                                                
                                                                               
 Number 2088                                                                   
                                                                               
 REPRESENTATIVE IVAN commended the efforts of the sponsor and the              
 intention of the bill.  However, as a minority member of the                  
 majority, he did not see how an appropriation bill of his would go            
 through.  Currently, the 1 percent protected the interest and                 
 included local culture.  He, therefore, saw the program as                    
 including ownership and giving respect while furthering local                 
 cultures.  He would vote against the bill, but he did respect the             
 intent.                                                                       
                                                                               
 Number 2159                                                                   
                                                                               
 CHAIR JAMES stated she supported art in public places without a               
 doubt and saw the benefits.  She had a problem, however, with the             
 percent for art program as a mandate.  She would vote to move the             
 bill from the committee, but she did not know how she would vote on           
 the bill on the floor of the House of Representatives.                        
                                                                               
 Number 2217                                                                   
                                                                               
 REPRESENTATIVE BERKOWITZ stated he just listened to a "no frills"             
 prison bill in another committee - the House Judiciary Standing               
 Committee.  It was unfortunate that this bill was also imposing "no           
 frills" to the rest of us.  The percent for art program did not               
 cost the state anything and it benefitted the artists and the                 
 communities.                                                                  
                                                                               
 CHAIR JAMES called for the roll call vote.  Representatives James,            
 Dyson, Hodgins and Vezey voted in favor of the motion.                        
 Representatives Berkowitz, Elton and Ivan voted against the motion.           
 House Bill 143 was so moved from the House State Affairs Standing             
 Committee.                                                                    
 ADJOURNMENT                                                                   
                                                                               
 Number 2217                                                                   
                                                                               
 CHAIR JAMES adjourned the House State Affairs Standing Committee              
 meeting at 8:45 a.m.                                                          
                                                                               

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