Legislature(1997 - 1998)
03/07/1998 10:05 AM STA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE STATE AFFAIRS STANDING COMMITTEE March 7, 1998 10:05 a.m. MEMBERS PRESENT Representative Jeannette James, Chair Representative Ivan Ivan, Vice Chairman Representative Ethan Berkowitz Representative Kim Elton Representative Mark Hodgins Representative Al Vezey MEMBERS ABSENT Representative Fred Dyson COMMITTEE CALENDAR HOUSE BILL 338 "An Act relating to the repeal of provisions of the Administrative Procedure Act, prohibiting the adoption of regulations by an agency of the executive branch of state government, annulling all regulations adopted by an agency of the executive branch, and relating to additional legislation to carry out the purposes of this Act; and providing for an effective date." - HEARD AND HELD HOUSE BILL 359 "An Act relating to regulation of health insurance plans; and providing for an effective date." - HEARD AND HELD HOUSE BILL 362 "An Act relating to the use of space for military lounges in state- owned or state-controlled airports." - MOVED CSHB 362(STA) OUT OF COMMITTEE HOUSE BILL 329 "An Act amending the definition of correctional facility to include a therapeutic treatment center; providing for the conveyance of the Harborview Developmental Center and appurtenant land to the City of Valdez for the purpose of conversion and lease of a part of the center for a therapeutic treatment center for the Department of Corrections; providing that such a land conveyance counts toward the general grant land entitlement of the City of Valdez; and providing for an effective date." - HEARD AND HELD (* First public hearing) PREVIOUS ACTION BILL: HB 338 SHORT TITLE: ANNUL ALL ADMIN. REGS; REPEAL APA SPONSOR(S): REPRESENTATIVES(S) VEZEY Jrn-Date Jrn-Page Action 1/21/98 2099 (H) READ THE FIRST TIME - REFERRAL(S) 1/21/98 2099 (H) STATE AFFAIRS, FINANCE 3/03/98 (H) STA AT 8:00 AM CAPITOL 102 3/03/98 (H) MINUTE(STA) 3/05/98 (H) STA AT 8:00 AM CAPITOL 102 3/05/98 (H) MINUTE(STA) 3/07/98 (H) STA AT 10:00 AM CAPITOL 102 BILL: HB 359 SHORT TITLE: HEALTH INSURANCE REGULATION SPONSOR(S): REPRESENTATIVES(S) RYAN Jrn-Date Jrn-Page Action 1/28/98 2153 (H) READ THE FIRST TIME - REFERRAL(S) 1/28/98 2153 (H) STATE AFFAIRS, LABOR & COMMERCE 3/03/98 (H) STA AT 8:00 AM CAPITOL 102 3/03/98 (H) MINUTE(STA) 3/05/98 (H) STA AT 8:00 AM CAPITOL 102 3/05/98 (H) MINUTE(STA) 3/07/98 (H) STA AT 10:00 AM CAPITOL 102 BILL: HB 362 SHORT TITLE: AIRPORT MILITARY LOUNGES SPONSOR(S): SPECIAL CMTE MILITARY & VETERANS AFFAIRS Jrn-Date Jrn-Page Action 1/28/98 2153 (H) READ THE FIRST TIME - REFERRAL(S) 1/28/98 2154 (H) MLV, STATE AFFAIRS 2/19/98 (H) MLV AT 4:30 PM CAPITOL 17 2/19/98 (H) MINUTE(MLV) 2/24/98 (H) MLV AT 4:00 PM CAPITOL 17 2/24/98 (H) MINUTE(MLV) 2/25/98 2427 (H) MLV RPT 7DP 2/25/98 2428 (H) DP: RYAN, KOTT, NICHOLIA, FOSTER, 2/25/98 2428 (H) JOULE, MULDER, MASEK 2/25/98 2428 (H) ZERO FISCAL NOTE (DOT) 3/03/98 (H) STA AT 8:00 AM CAPITOL 102 3/03/98 (H) MINUTE(STA) 3/05/98 (H) STA AT 8:00 AM CAPITOL 102 3/05/98 (H) MINUTE(STA) 3/07/98 (H) STA AT 10:00 AM CAPITOL 102 BILL: HB 329 SHORT TITLE: HARBORVIEW DEVELOPMENTAL CENTER SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR Jrn-Date Jrn-Page Action 1/16/98 2068 (H) READ THE FIRST TIME - REFERRAL(S) 1/16/98 2068 (H) STATE AFFAIRS, JUDICIARY, FINANCE 1/16/98 2068 (H) FISCAL NOTE (COR) 1/16/98 2068 (H) 3 ZERO FNS (ADM, DHSS, DNR) 1/16/98 2068 (H) GOVERNOR'S TRANSMITTAL LETTER 3/03/98 (H) STA AT 8:00 AM CAPITOL 102 3/03/98 (H) MINUTE(STA) 3/05/98 (H) STA AT 8:00 AM CAPITOL 102 3/05/98 (H) MINUTE(STA) 3/07/98 (H) STA AT 10:00 AM CAPITOL 102 WITNESS REGISTER JACK CHENOWETH, Attorney Legislative Legal Counsel Legislative Affairs Agency 130 Seward Street, Suite 409 Juneau, Alaska 99801-2105 Telephone: (907) 465-2450 POSITION STATEMENT: Provided information and answered questions on HB 338. NANCY MICHAELSON HC05 BOX 6916-F PALMER, Alaska 99645 Telephone: (907) 745-6673 POSITION STATEMENT: Testified in opposition to HB 338. DIANA BUFFINGTON, President and State Coordinator Children's Rights Council of Alaska; and Chairman, Alaska Task Force on Family Law Reform 314 Maple Street Kodiak, Alaska 99615 Telephone: (907) 486-2290 POSITION STATEMENT: Testified in support of HB 338. MARLENE LEAK 771 Eighth Avenue Fairbanks, Alaska 99701 Telephone: (907) 452-1015 POSITION STATEMENT: Testified in support of HB 338. REBECCA MICHAELSON HC05 BOX 6916-F PALMER, Alaska 99645 Telephone: (907) 745-6673 POSITION STATEMENT: Testified in opposition to HB 338. HARRY NIEHAUS P.O. Box 55455 North Pole, Alaska 99705 Telephone: (907) 488-9328 POSITION STATEMENT: Testified in support of HB 338. REPRESENTATIVE JOE RYAN Alaska State Legislature Capitol Building, Room 420 Juneau, Alaska 99801 Telephone: (907) 465-3875 POSITION STATEMENT: Testified in support of HB 338. DON STOLWORTHY, Legislative Assistant to Representative Beverly Masek Alaska State Legislature Capitol Building, Room 432 Juneau, Alaska 99801 Telephone: (907) 465-2679 POSITION STATEMENT: Answered questions on HB 362. BETSY ROBSON, Assistant Director Division of Institutions Department of Corrections 4200 Diplomacy Drive, Suite 207 Anchorage, AK 99508 Telephone: (907) 269-7410 POSITION STATEMENT: Presented HB 329. DUGAN PETTY, Director Division of General Services Department of Administration P.O. Box 110210 Juneau, Alaska 99811-0210 Telephone: (907) 465-2250 POSITION STATEMENT: Provided information on HB 329. REPRESENTATIVE GENE KUBINA Alaska State Legislature Capitol Building, Room 404 Juneau, Alaska 99801 Telephone: (907) 465-4859 POSITION STATEMENT: Testified in support of HB 329. JOE REEVES, Manager Division of Administrative Services Department of Correcrions P.O. Box 112000 Juneau, Alaska 998111 Telephone: (907) 465-3315 POSITION STATEMENT: Provided information on HB 329. ACTION NARRATIVE [NOTE: SIDE A, AND A PORTION OF SIDE B, WERE INADVERTENTLY TAPED OVER AND CANNOT BE RECOVERED.] TAPE 98-32, SIDE A CHAIR JEANNETTE JAMES called the House State Affairs Standing Committee meeting to order at 10:05 a.m. Members present at the call to order were Representatives James, Ivan, Elton and Vezey. Representative Berkowitz arrived at 10:10 a.m., and Representative Hodgins arrived at approximately 10:30 a.m. HB 338 - ANNUL ALL ADMIN. REGS; REPEAL APA CHAIR JAMES announced the first order of business is HB 338, "An Act relating to the repeal of provisions of the Administrative Procedure Act, prohibiting the adoption of regulations by an agency of the executive branch of state government, annulling all regulations adopted by an agency of the executive branch, and relating to additional legislation to carry out the purposes of this Act; and providing for an effective date." Number 0296 JACK CHENOWETH, Attorney, Legislative Legal Counsel, Legislative Affairs Agency, continued, "...to one specific example because I worked on this Legislative Council for the past three years. When Senator Green decided that she wanted to revise the agricultural regulations, she proposed changes that necessarily affected the regulations that were then in place and she specified in the bill that the regulation should be annulled, and we gave her that draft. Both in the 1995 and 1996-session, when that bill passed and got caught up in the argument of whether it was vetoed and the veto properly overridden - and in the bill that passed last year, there are specific regulations that are contrary to the proposed laws that she had been encouraging, and those regulations are identified and they are annulled. And, in point of fact, they are noted as annulled in the Administrative Code." Number 0307 MR. CHENOWETH stated it's going to take more work, no doubt about it. Whether you stick with the current system and try to identify particular regulations that should be set aside or should be amended, it's going to mean more focus on how you draft and enact statutes. He said, "If you go with something like this, my fear is that it's going to be each agency, each board, each commission for itself." Number 0306 MR. CHENOWETH continued, "Finally, there are a number of places where I'm not sure what the impact of this thing is. My recollection in Cleary v. State of Alaska [management of correction facilities and inmates' rights] is that one of the ways that Cleary v. State of Alaska, the (Department of) Correction's litigation, has been implemented is by requiring the adoption of an extensive body of regulatory material. If that material goes out are we no longer in compliance with what we're required to do in Cleary v. State of Alaska? In all of the places where the Legislature has said that we want to encourage agencies to bring in and conform their processes so that they would comply with federal law, what does it mean when an agency can no longer do that under something like an Administrative Procedure Act?" Number 0310 MR. CHENOWETH said, "And finally, I'll go back again and express whether you really want to spend your time worrying about things such as how to regulate the taking of the fishery and game resources in this state when it can be left to another agency or board or commission to be handled through the adoption of appropriate regulations. The same thing is true with the insurance or the regulation of insurance. The same thing is true with the regulation of public utilities in this state. All of the things that require examination and rate-making are held up to being unrepealed by this bill, and I'm not sure how you proceed." MR. CHENOWETH concluded, if this bill passes, where does that leave the Administrative Regulation Review Committee, what does it do. There are no rules and regulations for the committee to look at anymore. Number 0316 CHAIR JAMES said, "The one thing I wanted to -- in your testimony, that I would like to comment on is SB 109, the agricultural bill. And one of the reasons why I believe that those -- and I knew that you can negate Administration's regulations by law, by a statute, yes we can do that. And the reason that needed to be done, that just changing the law wasn't enough, is because they put regulations on that didn't implement the law. In other words, it went beyond the law and established things that was never intended originally in the law. There's lots and lots of cases of that." CHAIR JAMES noted, having been Chairman of the Regulation Review Committee for these last two years, it's a horrendous job just to look at those. The whole process of the notice of the regulations, which she believes we're making a few changes there, when it just says the area that is being changed, then you have to see that in the paper or people get noticed, then you have to send for the writing so that you can understand just exactly what is being changed, then you have to hold a hearing and make your comments and you don't know if they've listened to you or made any changes until you get the final draft when it's too late to say anything. Chair James said that's part of the problems that the public has that she hears about all the time. Number 0328 CHAIR JAMES mentioned Representative Vezey admits this bill needs to be tweaked if it's going to work and admits that it's just thrown out there for an idea. She said we need to think about it. CHAIR JAMES stated, even with the legislation of the negotiated regulation making, that we're trying to get through this year, we still have not addressed the communication that we need between the Administration and the Legislature on the meaning of the legislation, and it's a two-way street. She said, "Number one, I don't think when the Legislature passes legislation that they have thought about it thoroughly enough - it sounds good so let's do it and let the Administration fix it. And then when the Administration follows it, that's not what they meant, and it's not down anyplace where it meant. I'm not saying that it is all the Administration's fault, I'm saying it's a dual problem. And I'm saying if we're going to be able to meet the public's needs, we have to have more communication at this level of just exactly what (indisc.) legislation means. And there has to be then, if someone gets off ship in the Administration and puts in regulations that they want to implement this and thinks it fits, there needs to be a double-check there from the Legislature and the voice should be loud enough that they can make changes." CHAIR JAMES reiterated the public is bewildered and they look to the Administration and say they don't like this regulation and the Administration's response is the Legislature passed the law, we're just implementing the law, go talk to them. And the Legislature says, we can't do anything about it, it's a regulation. So they get the runaround and feel totally disenfranchised with their government. She said what she is trying to do is make the government more responsive to the public's needs, and that's why we're hearing this bill today. Number 0349 REPRESENTATIVE AL VEZEY explained the reason that the bill takes away the rule-making and regulation-making authority from the Administration, is because in 1980 the supreme court deflated rules and regulations of the agencies with law. The intent of the bill is simply to bring lawmaking power back to the Legislature. He said, "We're into a game of nomenclature here because nothing in this bill says the agencies can't make guidelines, they're not going to be law. Many of us think of rules as guidelines and what not, but the supreme court has said that rules and regulations enacted by the agencies are law and that the Legislature does not have the authority to annul those laws. So all we're really trying to do is separate the, what I would tend to call regulation and rule-making authority of agencies, we're going to have come up with new nomenclature and call it guidelines because it's not going to have the full force of effective law, if this becomes law." Number 0358 REPRESENTATIVE ETHAN BERKOWITZ on that point noted we do have the ability to repeal regulations, we just have to do it consistently with what the constitution says. We can repeal regulations if we do it by passing a bill, and then having that bill become signed into law, then we can repeal that regulation. We have delegated powers to agencies to make regulations. We (indisc.) that delegation consistent with the bill process - not a resolution process consistent with the bill process. He said once we make that delegation, the only way we can repeal those delegated regulations are through law, not resolution. CHAIR JAMES stated it raises that to a higher level. She said, "Let's say you've worked with the Administration and they refuse to change it. You're assuming that you wouldn't have to do a bill to erase a regulation if you tried the other method and they refused to change it. So you decide, they refused to change it, the only way that we can get rid of this onerous regulation is to pass a piece of legislation. It is subject to the Governor's veto, he or she's going to stand behind his Administration who refused to change the regulation and veto it, which then takes a two-thirds vote to override." CHAIR JAMES concluded we're only dealing with a law that doesn't have constitutional or even financial interest, and we have to have a majority to implement the negation of a regulation. She expressed, therein lies the problem. Number 0372 REPRESENTATIVE BERKOWITZ stated then the solution is simple, then don't delegate authority to agencies to make regulation. CHAIR JAMES remarked, that's where we are today. REPRESENTATIVE BERKOWITZ continued, "But we've already done that and the answer isn't undo all the regulations that have already been done, it's next time any one of us proposes legislation that within the legislation delegates power to an agency to make regulation, we make the regulation part of the legislation. And we don't do that, we don't do it for a simple reason, it's very complicated, it takes a lot of time, we don't actually have the expertise. What we do with legislation is set out guidelines. Now, the regulatory process can be enhanced, public participation can be improved, but once we make that delegation we've made that delegation. We are bound by the law that's created just to show you that it's a regular law. That's what the supreme court said." CHAIR JAMES asked Representative Berkowitz do you think we spend sufficient time on defining the law that we're putting into effect to have considered what the consequences would be. Number 0383 REPRESENTATIVE BERKOWITZ replied, Madam Chair, when you allow me a softball I'm going to smack it out of the park. There is no way that we give due consideration of legislation we pass. We don't give it... CHAIR JAMES interjected don't you think something like this would require us to be more cautious. REPRESENTATIVE BERKOWITZ responded you had entered the current circumstances, we're not cautious enough. Under the current circumstances, bills move forward insufficiently today. He said, "So, if I think if we would add to our responsibility we're going to be more careful, I don't think so. I think it paves the way to what the supreme court cautioned against in the opinion. They say the dangers of having the Legislature get involved in the minutiae that are involved in regulation, legislative veto encourages secretive, poorly informed and politically unaccountable legislative action. And that's one of the problems of getting involved in the detail." CHAIR JAMES said, what if we didn't have the Administrative Procedures Act, and what if the Administration wasn't required to write the regulations and what if we were. Wouldn't we be able to address that by passing a piece of legislation that had an effective date that's a year and a half down the road and in the mean time a legislative group working for the Legislature had to write the regulations and then we take a look at those to see whether we really like the legislation or not? REPRESENTATIVE BERKOWITZ replied, that's possible. CHAIR JAMES indicated that wouldn't take any more money because the same people that are writing the regulations would be replacing the ones that are currently doing them. But it would certainly be a better system. She said, "What I'm saying is, just because we've always done something a certain way, and if it has problems, there certainly is a better way. And we definitely have a problem with regulations and the public and we need to spend more time thinking about how to fix it." REPRESENTATIVE BERKOWITZ said, "And I agree completely, but this isn't a fix, this is just a..." CHAIR JAMES called on Representative Elton. Number 0404 REPRESENTATIVE KIM ELTON said he has a couple comments and a question of Mr. Chenoweth. [NOTE: TAPE 98-32, SIDE B IS BLANK.] TAPE 98-33, SIDE A Number 0001 REPRESENTATIVE ELTON continued, "...And just a comment of legislative intent, we often do things, and then when the consequences of our actions ripple out we say, well, we meant to do this, but we certainly never meant to have that occur.' So defining legislative intent is often difficult. We don't sometimes know what the effect of our intent is until it's been out there and until the regulation process begins, and somebody begins drafting a regulation we say, 'well, wait a minute, that may have happened under the terms of the law that we passed, but that wasn't unintended intent.' And a good regulation process helps us there." REPRESENTATIVE ELTON asked Mr. Chenoweth what happens if this bill were to pass. What would happen in the realm of emergency regulations? For example, if the Board of Fisheries allows the department to make an emergency closure in a commercial fishing area, if this bill passes, will the department be able to make those emergency closures. Number 0013 MR. CHENOWETH replied if this bill passes the mechanism for emergency regulations are no longer available. In the case of the fish and game example that you offer, he said he would see the appropriate board, or more likely the commissioner acting in some fashion to spell out what it is that ought to be done or that should not be done and finding some other appropriate vehicle by which to communicate that. He said, "If you can't use something that has the status of a rule or regulation and the force of law, it can be called something else, I think Representative Vezey identified that as a guideline, or call it something else. But the question is what is the legal status of that (indisc.) by whomever makes it, the Board of Fisheries or the commissioner, or however it's made. That's a good question because fish and game matters, particularly the regulations go directly out to the field to enforcement officers and they compile them and act on them because they know that after the running of the 30 days, and the regulation date becoming effective, those can be enforced. The status of agency decisions, however handled under this kind of legislation, is really opened at this point." MR. CHENOWETH noted he is more concerned about how all of the agencies that you're concerned about make decisions. Right now, if an agency program wants to make a decision it would have to at least notice it up and give the opportunity for public comment. He said, "Without that kind of requirement here, I'm afraid that you're going to see agencies essentially trying to fill in the places that the Legislature has left open in laws by some other mechanism - memos, desk references, something. There is going to be as many different devices I suppose as there are people who can dream them up. And I'm not sure that we'll ever find out what all of those may turn out to be. But more than that, there's no requirement that the public has an opportunity to review and comment before those things are put into play and as those are being changed. If I understand this correctly, agencies, boards and commissions may not adopt rules or regulation, they may not adopt something that has the force of law so they'll do something else, they will fill the gaps." Number 0039 CHAIR JAMES said she understands this is a very simple bill and doesn't have any parameters or any conditions to deal with the intricacies of the whole issue. She reiterated that it's too simple and doesn't solve the problem. CHAIR JAMES referred to Cleary v. State of Alaska. She told Mr. Chenoweth we could have in law that if the Legislature was going to approve regulations, we could do it similarly to what she said earlier ... is that we could have a longer effective date. We could not pass laws this year that is not effective until down the line, after the regulations are done, and then decide is that what we really meant and take another look at it with the public process. Chair James indicated that we could also establish an emergency situation where something is wrong, and the time is not yet for the legislature to meet, that they could have the authority to go forward and bring it back to the Legislature for approval at the next session. CHAIR JAMES continued, "If we were opening our minds up to what other kinds of methods might work, we might find and recognize some of the glitches that are in this situation that we have now that we don't notice because we're too busy following them. My whole idea is what can we do to make this whole area of law be more responsive to the public's good. And, that's for further thought, you don't even have to have an answer on that. But what I'm saying is this is just an idea that could be expanded in other directions, and I'm not saying that's the way we ought to go, I'm just saying that it recognizes that there are some flaws in the current system." Number 0055 REPRESENTATIVE VEZEY added that there are many things that you can do to address Mr. Chenoweth's concerns. For example, if the Legislature wanted to, it could give the agencies the authority to make law with say a 108-day life that automatically expires the end of the next legislative session if not ratified by the Legislature. The point being, is that in 1980 the Alaska Supreme Court, without regard, in his opinion, to some very important sections of the constitution gave the right to make legislation to the Administrative branch of government without going through the legislative process. Number 0066 NANCY MICHAELSON testified via teleconference in opposition to HB 338. She noted she has serious questions about the wisdom of passing HB 338 into law and strong objections to it. MS. MICHAELSON said, "The sponsor's, Representative Vezey's, statement says that HB 338 will not change any laws or regulations now in effect. I cannot see that to be true. Although the statement says, the bill provides for regulations to be brought before and ratified by the Legislature through the legislative process, that is very different than saying no laws or regulations now in effect will be changed. I find the wording of the bill to be insufficient. Should even one regulation concerning public safety or protection of our environment run into a snag while being taken up and approved by the Legislature, such as being tabled, delayed for any reason or dying in committee, that regulation would be changed, it would no longer exist. I find this to be insufficient and irresponsible." MS. MICHAELSON continued, "I want to understand Representative Vezey's motives for introducing this bill and I appreciate the fact that he opens this morning saying that it was philosophy more than mechanics. It's difficult for me to read the bill however, think about what it says and take it seriously. Legislative approval would, in my eyes, affectively shift regulations made for public interest in word to regulations subject to special interests, subject to the politics of tradeoffs, special deals, influenced by special interest, lobbyists and money. It appears introduction of this bill is done as something theoretically that makes sense to Representative Vezey but to me it seems like a nightmare. It appears it's an attempt to show how you, Representative Vezey, takes so seriously the charge to make the state government responsive to their responsibility to the state constitution which is very good, idealistically that is. However, realistically this bill seems to me to be a joke and a not very funny one." Number 0084 MS. MICHAELSON stated, "The end results of passing it, looks to me to be detrimental to the protection of our public health, our public safety, and irresponsible in that provisions protecting our environment would be taken away. I think that two-years-ago Joe Ryan, your legislative aid, was quoted in the hearing as saying, 'The question is, does the Legislature want to shirk its responsibility and allow major policy changes to be implemented by the employees of Alaska who are not elected by citizens to their position?' I say it's not a shirking of responsibility it's allowing professionals to do their jobs. It's taking important public protection out of the rings of politics and special deals. I don't believe it's possible for this body to draft legislation that would foresee every situation." MS. MICHAELSON concluded, "I believe it's a logistical nightmare, a public policy nightmare, and a bill that hopefully will go away with the next morning's light. I don't think that Representative Vezey's hopes for what he wants are best done in this bill. I think, if he wants a constitutional convention, then maybe we can spend our money planning for that and making sure that gets carried off instead doing this bill. And, I think you're asking bureaucrats to be even more bureaucratic by spending time preparing regulations for legislative review instead of doing their work at hand." Number 0097 DIANA BUFFINGTON, President and State Coordinator Children's Rights Council of Alaska and Chairman, Alaska Task Force on Family Law Reform testified via teleconference in support of HB 338. She said "It is about time that we take the special interest groups that influence the political appointees of whichever ruling body may be in effect by the Governor's appointees, especially in the family law areas, we should remove these people from setting down the interpretation of the Legislature which is usually on conflict with these agencies." Ms. Buffington gave a definition of rules and regulations. MS. BUFFINGTON continued, "These agencies have for far too long gone out of their way to implement outside the bounds of the intent of the Legislature. The Alaska Supreme Court says that the Department of Law, as well as the agencies concerned in the family referral agencies are usually using very strained interpretation of the law or a broad remedial reading of the law. And I don't know where your children are in school ... if they're in the remedial reading class, they are in the dumb class. And if our Department of Law cannot make rules and regulations that are within the intent of the law, then we have a serious problem that affects thousands upon thousands of people in this state on a very regular basis. We are for this bill, it is about time somebody did take the regulators, the bureaucrats who are certainly, absolutely, and positively, probably more biased against the people that they serve..." Number 0122 MARLENE LEAK testified via teleconference in support of HB 338. She said, "I have seen the legislature turned into essentially a feel good social club where activity is mistaken for productivity. And for 120 days the legislators get together and talk about how the people don't really understand what they go through and how hard they work and leave the actual responsibility to the legislation to the bureaucrats in the Administrative branch who are essentially unaccountable. The opponents that I have heard today, rather strikingly in my opinion, seem to attribute godlike qualities to bureaucrats in that they should not need to be accountable, they are the experts, they know these things and they would only be influenced improperly by being accountable, by being responsible for what they do. ... I cannot hold with the totally authoritarian view of the people who opposed this bill." MS. LEAK indicated that instead of trying to act as check and balance over the state's Supreme Court, making this terribly unwarranted, 1980 decision on the Administrative Procedure's Act, it has done nothing in response until now. It is not acting as check and balance. ... Ms. Leak explained state government, responsibility and accountability and gave an example of being an authoritarian. She concluded, if you want to make, the way things (indisc.) now, don't run for the legislature, get a job in the bureaucracy. Number 0167 REBECCA MICHAELSON testified via teleconference in opposition to HB 338. She said, "I am a citizen of Alaska and I'm currently 17 years old and a senior in high school. I have great hopes in my future. Next year I am attending a university down in the Lower 48 and I hope to return to Alaska some day. When I return to Alaska, however, I wish and hope and pray that I return to one that is not in the midst of chaos." MS. MICHAELSON continued, "My purpose today is to comment on HB 338. I see it as a travesty to the American government. I have spent an immense amount of time studying the American government, last year I traveled to Washington, D.C. and saw the government at work on a national level and I have great respect for it. However, this bill is not realistic and I find it would have awful awful effects on the state of Alaska. For example, discharging firearms in public parks is a regulation. I don't see how you can say the people who made this regulation, and the people who make other regulations, aren't accountable. They're professionals, they get paid for what they do and there is a committee set out to review these regulations. I see this bill as a shortcut for people on the committee or familiar with the committee. You know, if you get rid of people who make the regulations and you make the regulations yourself, then there is less work and I find that awful. Representative James was saying earlier that the public is horrified. Well I, a citizen of Alaska, am horrified that this bill is up for even review. I think it should be killed in the committee. I do respect that this bill is being brought forth however and there's discussion on it because it's a part of the government process, it's a part of democracy and I do appreciate that. I do appreciate Representative Berkowitz and Elton's comments on the fiscal impossibility of this and the reality that this would take an immense amount of work. You'd have to go into session after session, after session of work to review all these regulations. So, that is my opinion. HB 338 should not be considered to make into law." Number 0199 HARRY NIEHAUS testified via teleconference in support of HB 338. He said it takes longer to rewrite a statute to correct one of these regulations than it does to review the ones that have been brought to your attention because they're simply just not working. You could look at it and realize this wasn't the intent. For example, HB 375, page 2, Section 1(a) (short title, Crimes Against Children/Foster Care), freedom from substantial neglect of basic needs. ... He said, "You may consider food, clothing and shelter as a substantial need, but to what degree. You may have people within a bureaucracy - now we know the nature of a bureaucracy is to grow, therefore, if they want to secure their jobs, these basic needs will not be the same as what I consider basic needs. They will therefore push their intent rather than the people's intent which you are writing out in bill form. Therefore, I say yes, we need to review these regulations to say, no, this was not our intent." Mr. Niehaus gave another example. MR. NIEHAUS indicated, as lawmakers, you know what the intent is. He said, "That doesn't mean every regulation that's passed you have to change, it means the ones that come to your attention and are blatantly wrong, this is what you have the control over. And yes, I do agree with you and Mr. Vezey and I hope this bill does go through." Number 0221 REPRESENTATIVE JOE RYAN, Alaska State Legislature, came before the committee in support of HB 338. He said he went back and looked at the minutes of the Constitutional Convention and why the powers were separated the way they were separated. He explained King George III's agents arbitrarily made any rules and regulations they chose in the king's name which defied people of a whole lot of liberty, property and a whole lot of personal wealth which was a value of their work. And so they were very careful when they put the forms of government together to invest the power to make law in a representative body which represented the people. REPRESENTATIVE RYAN stated, "In our constitution, all power comes from the people and that power is represented by their elected officials. We choose as a body, both sides of this body, to give the Governor what administration we choose to give the Governor. We are mandated by the constitution to create a supreme court and (indisc.) courts are at our will and we can create them and dissolve them when we choose. So the ultimate power for the people in the state of Alaska rests with their elected representatives. When you delegate something as terribly powerful as the ability to make law to people whom you hire you must realize that they, and the person for whom they work, has a political agenda and that political agenda will very likely be exercised somewhere and their job of making laws. The fact that they are not accountable for that is very simple. If you and I pass an odious and (indisc.) law we will be held accountable at the next election. People will be angry and they will not support us and we will retire to private life. But we don't see people in the Administration being retired to private life for things they do by regulation, so there's no check and balance. We are told by the administrative branch that we should sit here and do that for which we were authorized to do and the governor will run his or her government as he chooses fit. And if we don't like it, then we can take the appropriate powers through the budget." Number 0244 REPRESENTATIVE RYAN continued, "This bill, in the face of it yes it's pretty simple, I think it should be flushed out somewhat. I applaud you in the work you've done in the last couple years in reviewing these regulations. I think there is a better system. I have complained bitterly that we have given away our lawmaking power by this Administrative Procedures Act, we've given away our taxing power by allowing the Administration to charge fees by regulation, and a fee or a tax are the same thing. ... And now we're contemplating the idiocy of giving the Governor blocks of money and holding goals and objectives as the purpose. Well it's obvious they'll come back in two years, and next year, and say you didn't give us enough money to accomplish our goals and objectives and so we did pretty much what we chose to do. I don't think we should abrogate these powers and abrogate this responsibility given to us by the public. I think that we are the people that will be held accountable. I think that, if not this bill, something very similar to it, or perhaps a committee substitute that goes into a little more depth is appropriate. I think the time is right and I plan on supporting legislation of this type." CHAIR JAMES asked Representative Vezey if he had any more comments. REPRESENTATIVE VEZEY replied no, it's been thoroughly debated. Number 0256 CHAIR JAMES indicated HB 338 would be held in the House State Affairs Standing Committee because it is not responsive to the public's needs. HB 359 - HEALTH INSURANCE REGULATION Number 0259 CHAIR JAMES announced the next order of business is HB 359, "An Act relating to regulation of health insurance plans; and providing for an effective date." CHAIR JAMES noted HB 359 was heard in the Children's Caucus and needs to hear tapes and have them put into the record. She indicated she would listen to them and move HB 359 on Tuesday. Number 0262 REPRESENTATIVE RYAN explained his staff was instructed to get them to her right away. He also mentioned there's supposed to be a committee substitute. REPRESENTATIVE RYAN noted there was a fiscal note on his aid's chair from the Division of Insurance (Department of Commerce and Economic Development) with an aggregate of $101,000. He said, "I called the department and asked for an explanation of the note and they felt that the AG (Attorney General) would have to defend, and there was $34,000 worth of travel, the staff person would have to be hired for this committee even though the legislation doesn't say anything about providing staff - the review committee. So I had asked to be prepared a committee substitute which holds the review committee harmless, there's no need for AG defense. And since there was no staff required we will put that in language that there is no staff required. The curious thing about that, I called the Governor's legislative liaison and said that I'd kind of like the fiscal notes in a more timely manner, especially when they have that kind of an impact. I was assured that that would take place and that it wouldn't happen again. But, my aid received a call from the Division of Insurance that I had asked for someone front and center to come down and explain that note to the committee. And I was told that person would have to be subpoenaed. So I plan on asking the Speaker for subpoena power ... and then I further am going to call the Governor's legislative liaison and ask why I was told to get a witness from the Administration to explain the fiscal note, we have to exercise subpena power." Number 0279 REPRESENTATIVE VEZEY made a motion to adopt a State Affairs Committee fiscal note of zero. CHAIR JAMES asked if there were any objections to adopting a zero fiscal note. Number 0282 REPRESENTATIVE ELTON objected. He noted, after hearing the benefit of the testimony that was taken in the Children's Caucus, it might be a better time to decide on what the fiscal note may be. Representative Elton said he thinks this is a little bit precipitous today and indicated he wouldn't object to the motion when more information in front of us. Number 0290 CHAIR JAMES requested a roll call vote adopting a State Affairs Committee zero fiscal note. Representatives Hodgins, Vezey, Ivan, James voted in support of the motion. Representative Elton opposed it. Therefore, the motion passed by a vote of 4-1. Number 0293 CHAIR JAMES announced the bill will be carried over to Tuesday. She asked Representative Ryan to provide a copy of the committee substitute and a copy of that fiscal note. She said she will provide a synopsis of the Children's Caucus hearing because minutes aren't taken in Children's Caucuses. HB 362 - AIRPORT MILITARY LOUNGES Number 0305 CHAIR JAMES announced the next order of business would be HB 362 "An Act relating to the use of space for military lounges in state- owned or state-controlled airports," sponsored by Representative Masek. CHAIR JAMES stated that the committee has taken testimony from DOT/PF in that they would provide for military lounges in the airport, without charging rent, providing that the space was available. She said the language in the previous work draft indicated that DOT/PF "shall" give them space. CHAIR JAMES noted there is a proposed committee substitute, Version H, dated 3/6/98, that says they may instead of shall do it. Number 0310 DON STOLWORTHY, Legislative Assistant to Representative Beverly Masek, Alaska State Legislature, came before the committee. He said after the previous hearing he spoke with the drafting attorney and asked to be given a legal rendering. He stated, "And they said, yeah it could be interpreted as making DOT/PF do it. So we worked on some language to make it more permissive." It reads: If the department permits space in state owned or state- controlled airports to be used as lounges and if the lounges are operated by nonprofits, then rent may be not charged for the use of this space. CHAIR JAMES indicated she is happy with that. VICE CHAIRMAN IVAN IVAN asked if we're referring to H version. CHAIR JAMES replied yes, we need to have a motion to put the committee substitute before us. Number 0316 REPRESENTATIVE MARK HODGINS made a motion to adopt the proposed committee substitute for HB 362, Version H, dated 3/6/98. Hearing no objections, that version was before the committee. REPRESENTATIVE VEZEY said he appreciates the changes that have been made, they do address his specific concern which is the fact that we would have been creating more troubles than we were solving. He stated, "I still don't know that anything's broken, that anything needs to be fixed, but I think I would gamble that we're not doing any harm here, and I think that's important we're addressing legislation to fix things that aren't broken." Number 0323 REPRESENTATIVE HODGINS made a motion to move CSHB 362 out of committee with individual recommendations and with attached fiscal notes. There being no objection, CSHB 362(STA) moved from the House State Affairs Standing Committee. HB 329 - HARBORVIEW DEVELOPMENTAL CENTER Number 0326 CHAIR JAMES announced the next order of business is HB 329, "An Act amending the definition of correctional facility to include a therapeutic treatment center; providing for the conveyance of the Harborview Developmental Center and appurtenant land to the City of Valdez for the purpose of conversion and lease of a part of the center for a therapeutic treatment center for the Department of Corrections; providing that such a land conveyance counts toward the general grant land entitlement of the City of Valdez; and providing for an effective date." Number 0330 BETSY ROBSON, Assistant Director, Division of Institutions, Department of Corrections presented HB 329 for the Governor. She noted, also with her, to provide explanation on the bill, are Dugan Petty - Department of Administration, Larry Streuber - Department of Health and Social Services, and Joe Reeves - Department of Corrections. She said the Harborview project is a very important project for the state of Alaska and has far reaching implications for being able to reduce recidivism to make our state safer. MS. ROBSON said HB 329 gives the Department of Corrections the authority to establish a therapeutic community for the purpose of providing intensive drug treatment to incarcerated offenders. She referred to a brochure that was distributed and explained Harborview Developmental Center is in the process of being closed down and noted it is the facility that they are looking at having their therapeutic community at. Ms. Robson noted they have done preliminary studies with an architectural firm to look at programming and planning, and find that the therapeutic community would fit nicely into two wings of this building. Number 0348 MS. ROBSON further explained that it's part of the Department of Correction's plan for addressing our severe overcrowding issues, the facility will incarcerate 16 medium to minimum custody inmates. The inmates who are participating in this program are inmates who would not otherwise be eligible for furlough or parole situations but by participating in this program that will enhance their possibility for furlough and parole, thus freeing up the beds sooner. The program will also have a strong transition component into the community which means that those inmates that are releasing on probation, parole, or furlough will in fact be supervised in the community and will have treatments that will follow them into the community. Number 0356 MS. ROBSON pointed out this program will allow the department to address some of our seriously addicted inmates. She said they estimate approximately 80 percent of the people who come to them have had involvements with substance abuse. They're also aware that they have very seriously addicted offenders, and up until this point in time, they have not had the opportunity to address that serious addiction. Ms. Robinson said, "We do have substance abuse programs in our facilities, they include education, a pretreatment component, and then an outpatient model. With the addition of this therapeutic community we would be able to address those seriously addicted offenders in a 24-hour a day program." Number 0362 MS. ROBSON emphasized the significant impact on their success with this program is the fact that they are designing culturally relevant programming. Last year the Legislature appropriated $50,000 for them to look into their current treatment, and to look at their existing treatment as far as making it relevant to the population. With that funding they are putting together training that will be provided to the prison substance abuse councilors and probation officers so that they will be able to evaluate people that will be going to this program and will be able to address the cultural issues with our population. MS. ROBSON said she believes the most significant point of this program is that it has the potential to reduce recidivism. She called the members attention to the research summary of the pamphlet, April 1997, and noted they recently received it from the federal substance abuse folks. Ms. Robinson said the fifth program demonstrates the effectiveness of this type of treatment. Last week they meet with a national expert, Doctor Gary Field, who informed them that they tend to see anywhere from a 30 to 45 percent reduction in recidivism when this type of treatment is applied to offenders. Ms. Robinson indicated they expect to start out with a 25 percent decrease in recidivism by these offenders and anticipate that it will rise as the program gets underway. She noted that they are very excited about this program and are really urging that people give it due consideration. MS. ROBSON noted, "As part of the process of locating the therapeutic community, it is necessary for the State to convey a State facility, and that is the Harborview Hospital." She asked Dugan Petty, from Department of Administration to explain Section 2 of the bill which addresses the conveyance of the property. Number 0388 DUGAN PETTY, Director, Division of General Services, Department of Administration, came before the committee in support of HB 329. He said the Department of Administration has been working with the City of Valdez, the Departments of Health and Social Services, Corrections, Natural Resources and Transportation and Public Facilities in preparing an interim agreement to prepare for the conveyance of the property. He pointed out this building is approximately 89,000 square feet, with a replacement value that is estimated to be over $40 million. It's currently being used as the hospital in Valdez and, of course was used as the Harborview Development Center. MR. PETTY stated this is the first time they have decommissioned a (indisc.--coughing) building of this nature. He noted the Department of Administration has screened other state agencies and the only use within the system for this building, which has been expressed to them, is the one by the Department of Corrections. He reiterated they have been working with the City of Valdez to prepare an interim agreement based upon the indications that they received from the Legislature of last year in funding some funds to make available to explore this project. Mr. Petty said, "We have excessed the personal property from the building except for that will remain with the facility and are prepared to move forward with this project. We think it makes good sense and support the project." Number 0401 CHAIR JAMES asked if the current hospital is at one end of this. MR. PETTY replied yes. CHAIR JAMES asked who owns the hospital. MR. PETTY responded, "The hospital, it's been my understanding is owned by the..." [owned by the State of Alaska]. TAPE 98-33, SIDE B Number 0001 CHAIR JAMES said she understands that one of the reasons it was closed down and was not to be used as it was before was the high cost of operations. She asked what were the specific instances that caused it to be so expensive to operate in that building. MR. PETTY deferred to Larry Streuber, Department of Health and Social Services because he is more familiar with the operating costs of the facility. He said he knows that they have taken some efforts to put some energy conservation devices in there to both get a better read on the facility, to break them out, and also to reduce some of the operating cost. Number 0011 CHAIR JAMES expressed one of the concerns she has with these types of programs, of treating people who are subject to addictions, is that when they go back home sometimes they fall right back into it. She asked what kinds of provisions do they have for those kinds of conditions. MS. ROBSON explained they recognize that the return to the community is a very critical point for these individuals and in fact, as part of the staffing for this facility, they will have a transitional counselor and a counselor aid. They will begin working with that individual as soon as he enters the program to help design his release plan in terms of the type of employment he'll have, where he'll live, what kind of housing. Ms. Robinson explained that when they're ready to release the offender they will have made contact with the community to and make sure that support systems are in place because studies do show that there is a marked increase in success if you're able to have effective aftercare or transitional planning. CHAIR JAMES referred to the training program for the offenders. She asked "Are you going to be associated with some other ability for getting education such as the Prince William Community College or are you going to be doing all of the training for job opportunities throughout your program or is it associated in any other way with any kind of education for these people." MS. ROBSON replied they have been primarily focusing on the treatment aspect of it. She said they know they will have to have an education component and have had brief discussions with the community college in Valdez. That program has not been designed yet, but they understand that they need to have an educational program. CHAIR JAMES asked what is the time line. Number 0033 MS. ROBSON responded they are looking at the program opening in October of this year and indicated they do have some very real concerns in terms of the renovations that have to be made on the facility because the two wings that we will be occupying (indisc.-- coughing) will have to be renovated. She noted last year the Legislature approved a federal appropriation of $400,000 that came through grant funding which will be transferred to the City of Valdez to be used for (indisc.--coughing) process. The City of Valdez has also indicated a willingness to support, through funds, the renovation of the building. She added that they are concerned with the time line. Number 0046 VICE CHAIRMAN IVAN called the State Affairs Meeting at-ease due to a fire alarm at 11:46 a.m. CHAIR JAMES announced the meeting will be called back to order at 12:00 p.m. Number 0053 REPRESENTATIVE GENE KUBINA, Alaska State Legislature, came before the committees. He said, "...and as Health and Social Services shut it down, it would create great problems for us in our hospital in what we would do with it. You asked the question of why it was so expensive. Health and Social Services made a decision years ago that they would not put more people in Harborview. In the last six years or so, it's been housed at less than half its capacity. It was in my opinion housed in so that it was made to be expensive so they could close it. They philosophically did not want to house developmentally disabled people in a large institution. So it's just a philosophy, they've all gone out to community based so that's why it was so expensive. ... We did have a facility before the earthquake, in old town, and this facility was built pretty much on federal funds to house the hospital and Harborview Developmental Center after the quake mostly on federal dollars." Number 0065 REPRESENTATIVE KUBINA noted that this is the only real option that anybody's come up with of what to use the facility for. He said it's basically not to house people. Last year, in the budget, we did approve $400,000 of federal crime dollars. He read, "For a therapeutic treatment community program of up to 100 beds in Valdez where the cost per inmate-day exclusive of treatment costs would not exceed the statewide average per inmate day for correctional institutions." So they've put in a ceiling. They said, all right you can have this program, but you have to come in at this cost, and that's what we're approving. REPRESENTATIVE KUBINA mentioned they had a meeting in the fall with the Chairs of both Finance Committees and they gave a report. He pointed out members of the Finance Committee insisted they have a recording mechanism to ensure -- it says, according to backup the savings generated by treatment will be substantial. In other state programs a cost average of a seven-dollar return for every dollar invested. Future savings should be documented for each dollar invested in Harborview and that again was in the budget last year that we passed. He reiterated that the department knows that they cannot go over a certain price for this thing and they have to show, over a period of time, that it's cost-effective. Number 0080 REPRESENTATIVE KUBINA mentioned they weren't able to get Doctor Gary Field in front of the House State Affairs Committee. He noted Doctor Field runs a similar program in Oregon and reported, in the last seven years, they've been able to document huge savings that they now have added three other programs in Oregon - spread around the state. REPRESENTATIVE KUBINA mentioned HB 329 has three other referrals and there is a catch, in the budget of last year, of the price that is has to come in at. While it's not in the budget, it is included in the Governor's overall budget number that is there so it's not an add-on to his proposal. CHAIR JAMES reiterated her concern of the offenders returning to their community. She suggested the offenders work during the day and return to Harborview in the evening as a transition. Chair James mentioned she was also interested in the training they would be given because just getting them well isn't enough because most of the people, who have substance abuse problems, don't have any work skills either. She asked if there are halfway-houses anywhere else in the state where these people can go out to work and come back. She said she believes those suggestions may make it a more successful program in the long run. Number 0119 REPRESENTATIVE KUBINA responded Doctor Field said, statistically one of the big things about this program is that it is separated and away by itself during the program. Doctor Field said they have found that when the offenders are still in a prison setting, drug and alcohol programs don't work. He suggested isolating them from all other inmates, to keep them with people that are going through this same type of program - maybe staggered in there depending on how long they've been there, how far they've gone, etcetera. He also mentioned the program shouldn't be less than six months long and maybe, depending on the individual, maybe up to a year. Representative Kubina suggested, once they reach the point of being released, rather than just say go home, suggest a halfway-house. CHAIR JAMES said there are so many laws affecting this person, the length of their sentence, that whether or not you have enough time to do this, and if you don't you might as well not spend any time on it. Chair James noted, because we haven't had a system like this before, maybe the rest of our system needs to be amended or adjusted to be sure that this is an opportunity for these people. Number 0135 MS. ROBSON pointed out they did survey the population prior to beginning any planning on this project to determine if we had an inmate population that had the need that this type of treatment would provide. She said they have completed three different surveys and found that there is certainly a population that has the sentence length to be able to participate in this program. In fact, there are easily 60 individuals in our system right now that could benefit from that. Substance abuse councilors look at each individual offender to determine if they were individuals who would benefit from this program, if they had the kind of background that would make them good candidates for this program. MS. ROBSON explained this would allow them to address serious substance abuse problems so that these individuals could be considered for furlough, for parole and their chances for being granted those early release mechanisms would be greatly enhanced by having gone through the treatment. REPRESENTATIVE BERKOWITZ said he would assume that a lot of the folks that would come through this program would be felons, because of the duration of the program, which would mean that subsequent to participating in this they would get a halfway-house as a further transition and then be on some form of intensive parole. Number 0150 MS. ROBSON responded they could possibly be furloughed to a halfway-house situation. One of the things the experts tell us is that once an individual completes this very intensive treatment, you have to be very careful that you don't put them back into a more restrictive setting because what you can do is you can undo the work that you have done. Ms. Robson said, "But there are cases, in fact when we were talking with Doctor Field, where there maybe individuals who need that very structured environment, to go out to work, to have somebody to be accountable to when they come back. The individuals, once they've finished, if they were furloughed to a halfway-house, or go out to the community, they would be under supervision - either it would be mandatory parole, in some cases there maybe an instance of discretionary parole. So there would be some furlough status there. In almost all cases in Alaska felons do receive probation supervision, so there would be supervision of these individuals out in the community." REPRESENTATIVE BERKOWITZ asked Ms. Robson if she anticipates that there will be aftercare and that aftercare is going to be flexible enough so you can cater to the individual who's being treated. MS. ROBSON replied that's correct. She noted that is one of the reasons they have two transition counselors, is to begin working on that release planning the minute they come into that program. If the individual for instance wants to go back to his village they can start making contact and ask if they have that support system there, is community treatment available. If it's not, how can we address that issue. They're looking at trying to send people back into their communities safely. Number 0167 REPRESENTATIVE ELTON said he believes this makes economic sense. He stated, "One is we don't have enough beds in the system anyway, and so we're adding beds, ... and those beds will be no more expensive than the beds that you're already providing on a statewide average, and so you're kind of redirecting how the dollar is being spent on the prisoners. You're spending the same amount of dollars on each individual that's incarcerated but, as Pete Wilson notes, each dollar that you spend on treatment you're saving seven dollars down the road so it makes economic sense in future savings. You're nodding your head, so I'm understanding correctly about the economic benefits." MS. ROBSON replied yes it has been shown nationally that there are economic benefits to doing this type of treatment. When they've done the studies and look at what substance abuse costs when a person is in an addictive cycle in terms of hospital courts, criminal justice system. Number 0178 REPRESENTATIVE ELTON mentioned a dollar is not going to be an added-on dollar, that's a dollar you'd be spending on these people because they would be incarcerated elsewhere. So you're not adding dollars on because of the requirement that the cost of keeping that person in that bed, not exceed the cost of keeping that person in a bed - in any other part of the correctional system. MS. ROBSON responded that's correct. She said they've done an analysis and found that the cost of this program is comparable to the cost of their other facilities. REPRESENTATIVE ELTON asked is the flow of people into these beds going to be completely controlled by the correctional system. Or can the court, as part of the sentencing portion, can they say we sentence you to two years in Palmer and eight months at Harborview. MS. ROBSON explained this program would be similar to some of their other treatment programs and that is the courts frequently will make a recommendation for treatment, it may be sex offender treatment, substance abuse treatment, batterers program, and when the Department of Corrections receives those judgements, they will look carefully at those and try to honor the request if at all possible for treatment if the person has the length of time and custody level and all to fit into the programs. That would be the same with this program. Number 0192 MS. ROBSON further explained this program adds to their continual month care. She said they have substance abuse education, introduction to treatment and then an outpatient treatment model, but they don't have the end of that treatment continuum which is this therapeutic community. So, by adding this, they now have a full continuum of care so when the councilors in the jails see these individuals coming in they can say, "Okay this is an individual that needs therapeutic community introduction and education aren't going to do the bill, this guys been at this for 25 years and needs some serious intervention." So it adds that extra tool on so that we can actually meet the needs of the offenders. REPRESENTATIVE ELTON noted that is the department's tool and not the court's tool. The Department of Corrections would be in control of the flow of people. MS. ROBSON replied yes we would be in control of the flow. Number 0200 CHAIR JAMES asked if you have somebody who is really a victim of substance abuse and now they're incarcerated, and it's not available to them, how do you take care of those people, how do they survive. MS. ROBSON stated an institutional substance abuse treatment councilor will do an assessment on the individual and they will determine the level of treatment the individual needs. In the case of someone that needs intensive treatment, they don't have that currently available. She said they may decide to put them in the next lower level of treatment which is the outpatient model and have them treated there. They may also, when the individual comes up furlough or parole, they may say, "I think this person needs wait longer, we need to wait and see if we can get him in a treatment program in the community when they're close to the end of their sentence or at the end of their sentence." MS. ROBSON asked Chair James, "Treatment in the community." CHAIR JAMES replied any level of that treatment. She asked if that is part of the Department of Correction's budget, is there any reimbursement by the offender. MS. ROBSON explained the treatment that occurs in the institutions with the substance abuse councilor is part of the Department of Corrections budget. The treatment facility that individuals might be furloughed to are paid for by the Department of Health and Social Services who have a specific number of grant positions available to the department for that. She said she believes, in the case of the individual in the community, that some of that is paid for through alcohol and drug grants and then the individuals may pay some of that if they're in the community. Number 0216 CHAIR JAMES said, "Gene [Representative Kubina] indicated that with the budget that was authorized last year to review this opportunity - and that 400 beds - and also to keep the level exclusive of the health provider, exclusive of the medical part that the cost to keep them in this facility would be the same as the average statewide. So, if the cost of keeping them there is the average statewide, but then on top of that you have the medical coverage -- what we we're talking in the hallway when I said what do these people do all day, and you said their treatment is all day. But you did say they would be doing their laundry and they're working in the kitchen and doing the scrubbing and those kinds of things. And then I asked well do they get paid for that. It occurs to me that if there's additional expense, over and above the amount that it costs just to keep them at the average cost, and they're going to get medical treatment that's past that, which has a cost, that may be they could get credit for working to pay for that so that at least they have some responsibility for what they're getting." She asked if her suggestion makes sense. She said she doesn't know if our law allows that or not, but was thinking that might be a way to deal with that extra cost for the medical. MS. ROBSON replied yes it does. She said she believes that (indisc.--noise) cost of care per day that they do have, in fact the health care is built in here, including the amount for inmate gratuities and wages. She mentioned Joe Reeves could go over the cost of care per day. Number 0234 JOE REEVES, Deputy Director, Division of Administrative Services, Department of Corrections, Manager, Division of Administrative Services, Department of Corrections came before the committee. He said he has been on board with the Valdez therapeutic community transition from the Department of Health and Social Services to the Department of Corrections as a therapeutic community for the last couple of years and has helped Ms. Robson and other members of the agency's transition team develop costs that would be within the (indisc.) of the legislative intent that was given to them. MR. REEVES referred to page 4 of the handout, he said it shows the statewide average that they currently operate under in the institutions, and that captured all cost categories that were provided in the fiscal note they attached to this bill - institutional costs, inmate programs, inmate health care and the Division of Administrative Services in support cost for a total. He stated, "And you say that, apparently in 1998 the statewide average for the institutions is $100.07 a day. We took the proposed Harborview therapeutic community and derived the cost of that on the fiscal note and that made up $1,800,000 - 58.9 of which we broke out to be $84.88 a day. You add the inmate programs at $28.49 a day, you add inmate health care that was in the fiscal note of $10.68 a day, you add the admin. support cost which was basically the date of communication... It works out to be about thirty-one cents a day, and that makes out to a total -- statewide indirect is not included in the Valdez therapeutic community because statewide indirect in this calculation pertains to equipment of building depreciation and capital resources which we don't have any in this project. So the statewide total is $124.36 a day, and when you extrapolate that, the inmate treatment. It comes out to be $95.87 a day." Number 0255 CHAIR JAMES reiterated there is approximately $30 a day calculated in for the treatment. MR. REEVES replied treatment would now be $28.49 a day. CHAIR JAMES mentioned that has to be paid for by the state. She indicated Mr. Reeves said the statewide indirect, which refer to maintenance and so forth is zero. She asked who's going to maintain the facility. MR. REEVES responded that it will be maintained by the City of Valdez. CHAIR JAMES said she understands this building was under the Department of Health and Social Services and is currently being transferred to the City of Valdez, and then the city will contract with the Department of Corrections to do this. Number 0260 MR. REEVES stated the facility will be transitioned from the State of Alaska to the City of Valdez and we will lease the portion of the facility from the City of Valdez. CHAIR JAMES said, so you're going to lease it maintained. MR. REEVES replied yes. CHAIR JAMES asked who will these people be working for. MR. REEVES responded they will be working for the Department of Corrections. CHAIR JAMES indicated she would like to have them working for the City of Valdez. Number 0266 REPRESENTATIVE KUBINA pointed out, because some people have had a fear of what the cost will be to maintain the building, the city has taken on that responsibility and that liability. He said the Health and Social Services maintenance person is going to be transferred to the City of Valdez. So if the roof has a problem, the city's taken on that responsibility, it will not be a State one. CHAIR JAMES mentioned the Legislature has dealt with a lot of issues in the area of prevention with calculations of how much money you're going to save if you do this. They're really a hard- sell only because you really don't know until you've done it. Even though you use other people's experiences, it's really difficult for people to buy into that. She noted that's one of the things that she's ever found to sell are prevention programs of any kind no matter where it is. She asked Representative Elton if he had any other questions. Number 0279 REPRESENTATIVE ELTON said he was going to make a motion to move HB 329 out of committee. CHAIR JAMES stated we're not going to be able to move this out today. REPRESENTATIVE ELTON said he thought the packet of information that the people provided was pretty thorough and appreciated the comments and testimony and this does have some legislative history that goes before the drafting of the legislation. He said he agrees with Chair James comment that you don't know what's going to happen until you try it. He mentioned one of the things that has given him some comfort is the fact that somebody has tried this in another jurisdiction. Representative Elton said, "I think that the comments by Governor Pete Wilson, that are part of the supporting packet, where he talks about the value of the dollars that you invest in this, giving you a savings for every one dollar, giving a savings of seven dollars down the road, now that may or may not be accurate and that may or may not be what happens here. But, I think that I'm comfortable enough to give this a boost in the right direction and I think that it is something we ought to try." CHAIR JAMES said he could make a motion. Number 0292 REPRESENTATIVE ELTON withdrew his motion. CHAIR JAMES said she thinks we can move HB 329 out on Tuesday. ADJOURNMENT Number 0295 CHAIR JAMES adjourned the House State Affairs Committee at 12:21 p.m.