Legislature(1995 - 1996)
01/31/1996 01:37 PM Senate CRA
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
SENATE COMMUNITY & REGIONAL AFFAIRS COMMITTEE
January 31, 1996
1:37 p.m.
MEMBERS PRESENT
Senator John Torgerson, Chairman
Senator Randy Phillips, Vice Chairman
Senator Tim Kelly
Senator Fred Zharoff
Senator Lyman Hoffman
MEMBERS ABSENT
COMMITTEE CALENDAR
EXECUTIVE ORDER NO. 93
Transferring responsibility for Alaska Regional Economic Assistance
Program.
SENATE BILL NO. 206
"An Act relating to welfare reform by establishing the Alaska
Family Independence Program; repealing the aid to families with
dependent children and job opportunity and basic skills programs;
relating to an exemption to Alaska Wage and Hour Act for certain
work activities of the Alaska Family Independence Program; relating
to the duty to support children of minor parents; relating to
certain licenses and applications for a license for persons who are
not in substantial compliance with orders, judgments, or payment
schedules for child support; relating to an exemption to the state
procurement code for certain services for the general relief
program and Alaska Family Independence Program; relating to
eligibility for day care benefits administered by the Department of
Community and Regional Affairs; authorizing the Department of
Health and Social Services to operate a public assistance program
consistent with the Alaska Family Independence Program under
federal waivers and providing certain immunity from liability for
activities of that program; amending Alaska Rule of Civil Procedure
90.3; and providing for an effective date."
PREVIOUS SENATE COMMITTEE ACTION
EO 93 - No previous action to record.
SB 206 - No previous action to record.
WITNESS REGISTER
Lamar Cotten, Deputy Commissioner
Department of Community & Regional Affairs
P.O. Box 112100
Juneau, AK 99811-2100
POSITION STATEMENT: Testified in support of EO 93
Jay Livey, Deputy Commissioner
Department of Health & Social Services
P.O. Box 110601
Juneau, AK 99811-0601
POSITION STATEMENT: Offered information on SB 206
Jim Nordlund, Director
Division of Public Assistance
Department of Health & Social Services
P.O. Box 110640
Juneau, AK 99811-0640
POSITION STATEMENT: Presented overview on SB 206
Curtis Lomas
Welfare Reform Program
Division of Public Assistance
Department of Health & Social Services
P.O. Box 110640
Juneau, AK 99811-0640
POSITION STATEMENT: Responded to questions on SB 206
Shannon O'Fallon, Assistant Attorney General
Human Services Section
Civil Division
Department of Law
P.O. Box 110300
Juneau, AK 99811-0300
POSITION STATEMENT: Offered information on SB 206
Glenda Straube, Director
Child Support Enforcement Division
Department of Revenue
550 W. 7th Ave., Suite 312
Anchorage, AK 99501
POSITION STATEMENT: Offered information on SB 206
ACTION NARRATIVE
TAPE 96-1, SIDE A
Number 001
CHAIRMAN TORGERSON called the Senate Community & Regional Affairs
Committee meeting to order at 1:37 p.m., and introduced Executive
Order No. 93 as the first order of business.
LAMAR COTTEN , Deputy Commissioner, Department of Community &
Regional Affairs (DCRA), related that during the past summer both
his department and the Department of Commerce & Economic
Development (DCED) were given the assignment to review both of the
organizations internally and also with respect to how they
coordinate. As a result of that review, it was decided that it
would be more appropriate for the ARDORS program (Alaska Regional
Development Organizations) to be shifted from DCED to DCRA, a
compelling reason being that the needs of the program were largely
located with those ARDORS in rural Alaska. DCRA has offices in
Fairbanks, Dillingham, Bethel, Kotzebue and Nome, and it was felt
that the program could be better integrated into existing programs
at a cost savings to the state. He pointed out that this doesn't
preclude involvement by DCED or other departments with the program,
but that DCRA would take the lead and the administrative
responsibilities with the program.
Number 060
SENATOR TORGERSON directed attention to a letter from the Alaska
ARDOR Association stating their support for the change. He also
stated that it is not necessary to have a motion to pass an
executive order out of committee unless there is a stated
objection.
SB 206 WELFARE REFORM
SENATOR TORGERSON introduced SB 206 as the next order of business.
He said the department would be giving an overall section-by-
section review of the legislation and that another hearing would be
scheduled in the future to take up the parts of the bill that
relate to local government. The following teleconference sites
were participating in the meeting in a listen-only mode:
Anchorage, Bethel, Cordova, Dillingham, Fairbanks, Glennallen,
Homer, Kenai, Kodiak, Kotzebue, Ketchikan, Mat-Su and Tok.
JAY LIVEY , Deputy Commissioner, Department of Health & Social
Services, explained that the Aid to Families with Dependent
Children program (AFDC) is a joint federal/state program and any
changes made to AFDC in Washington, D.C. will greatly affect what
is done in Alaska.
The stand alone welfare reform bill was sent to President Clinton
and it was vetoed, primarily for reasons of lack of money in child
care. There are still similar welfare reform proposals that are
tied up in various budget reconciliation strategies, as well as a
welfare reform bill that is being promoted by conservative
Democrats and moderate Republicans. That bill still may be adopted
and go to the President. Mr. Livey said it is a very volatile
issue and there is still a good chance that federal reform will
occur this year.
Mr. Livey said SB 206 allows Alaska to move forward with reform
regardless of what happens in Washington, D.C., by providing the
framework for welfare reform in Alaska if federal reform were to
pass. If federal reform does not pass, it provides the state with
the ability to write waivers and to implement portions of the bill
and go forward with welfare reform.
Number 101
SENATOR TORGERSON inquired what would be required if it becomes
necessary to write waivers.
JIM NORDLUND , Director, Division of Public Assistance, answered
that his division is taking a close look at what it would take to
implement the governor's welfare reform plan through a waiver
process. They do know that there is a fast track process that
President Clinton made available to the states last fall, but they
are still in the process of investigating just how all of the
pieces would come together and the timing of those pieces. He
agreed to provide information to the committee that would identify
which sections of the bill would necessitate waivers and which
sections would not.
Mr. Nordlund explained that SB 206 is a piece of an overall
comprehensive welfare reform plan. It is an inter-agency
collaborative process between many departments in state government.
In developing SB 206, besides that inter-agency input, they had the
blueprint for welfare reform that was developed a year ago by the
Governor and the Administration; they held a series of community
meetings and call-ins; and they looked at welfare reforms that have
been tried in other states and incorporated some things that have
been working in other states, as well as incorporating parts of
last year's legislation introduced by the Governor and
Representative Hanley and Senator Green.
A principle that went into the legislation and is carried through
in the legislation and the budget is that in order to receive
welfare in the future, individuals are going to basically have to
work for it, either through community work activities or by moving
into paid employment. He added that there will be individuals who
will not be able to work and they do allow for those exemptions.
A major part of the new emphasis on work is the need to provide
adequate job training and child care for individuals so that they
can move into the work force, stay in the work force and then be
able to stay permanently off of AFDC.
The legislation also places a five-year limit on benefits. This
will place a greater responsibility on all of the agencies
represented to make sure that when that five-year limit runs out
the individuals have been given the opportunity to go into the work
force to be able to provide for their own self- sufficiency.
Number 290
SENATOR KELLY asked if the bill makes changes to benefits and JIM
NORDLUND responded that the bill carries forward the level of
benefits that the state pays right now. Generally, their approach
to dealing with the amount of state money that goes into AFDC and
their efforts to try to reduce that is by reducing the caseload --
taking the number of people who are currently on AFDC and moving
them into the workforce, thereby reducing the budget that's
necessary to fund benefits. He added that in this year's budget
request, the department is asking for reinvestment of dollars that
they have already saved due to lower caseloads; they are asking for
that money to be reinvested back into child care and job training.
SENATOR KELLY asked if there is any kind of automatic increase on
the cost of benefits or if they are established by statute. JIM
NORDLUND replied that the benefit level is established by statute
so it necessitates a statutory change to increase the benefit
level.
Number 320
SENATOR TORGERSON asked how many people are currently in the
system. JIM NORDLUND responded that there are approximately 12,500
families on AFDC, which translates into about 37,000 individuals,
24,000 of which are children.
Number 330
Continuing his overview, JIM NORDLUND said another principle of the
legislation is to maintain a safety net for the poor. He said
they recognize that AFDC primarily, right now, is a cash assistance
program for needy individuals in the state and they don't
anticipate that poverty is going to go away. There will be
citizens in Alaska, especially children, who are going to continue
to need help and this program still maintains that general
principle.
Another principle is the notion of promoting parental
responsibility, both in terms of child support, as well as taking
on the responsibility to do more to move off of public assistance
and into self-sufficiency.
Administratively, the division is taking a new direction. When
leases come up for Division of Public Assistance offices, they are
taking that opportunity to share space with the Employment Security
offices around the state. Also, they are looking towards changing
the role of their individual workers; eligibility technicians will
become case managers and will work with clients and provide them
with the necessary tools for them to move off of public assistance
and into a job.
Mr. Nordlund outlined the following features included in SB 206:
(1) The legislation repeals AFDC statutes and the JOBS program
entirely. It creates a new program called the Alaska Family
Independence Program. The bill is designed to take advantage
of what is anticipated will happen with federal welfare
changes.
(2) The Child Support Enforcement provisions in the bill give the
Child Support Agency additional tools to collect payments from
delinquent obligors, primarily through the threat of
revocation of occupational and drivers licenses.
(3) It establishes limits on assistance and achieves cost
reductions.
(4) It emphasizes work and job development through reinvestment of
benefit savings.
(5) It maintains a safety net for low income families.
(6) It involves communities in achieving meaningful reform of the
system.
Mr. Nordlund discussed the equalizing of benefit distribution.
Currently, there can be two families in the state in exactly the
same situation, but one family may receive subsidized housing or
free housing and the other family doesn't; however, they receive
the same cash benefit. It is proposed to equalize those benefits
through regulation, which will mean an appropriation level savings
to the state that the department plans to reinvest into providing
additional incentives for people to go to work.
Number 520
SENATOR KELLY asked if this means they are not going to give the
rent payment to the people who are living in subsidized housing.
CURTIS LOMAS , Division of Public Assistance, explained that the way
AFDC payments are currently calculated under law, housing costs are
simply not taken into consideration. The number of people in the
family and their income are the two main factors that go into the
calculation. Although they are still developing the details, in
effect, what they propose to do is to take a family's housing costs
into account when they calculate the payment for their overall
living expenses.
TAPE 96-1, SIDE B
Number 001
There was brief discussion on food banks in the state, and SENATOR
TORGERSON asked that the committee be provided with a list of where
these food banks are located.
Number 025
JIM NORDLUND pointed out that one thing that was heard through
their community meeting process this past summer was that local
communities would like to play a greater role in the administration
of the AFDC program or the Alaska Family Independence Program, if
SB 206 passes. The legislation provides the authority for local
organizations, nonprofits, as well as local communities to
administer parts of the program. Because there is still a lot of
uncertainty surrounding welfare reform, this idea has not really
been developed yet. He added that it is the intent of the Governor
and Commissioner Perdue to divest some of the services that are
currently provided by state government to local organizations in
the administration of the program.
Mr. Nordlund said the bill also asks the state to cooperate with
Native organizations in terms of the administration of the new
program. In the federal law, which is anticipated to pass, Native
organizations will be allowed to contract directly with the federal
government for provisions of services that the state currently
provides.
Number 060
JAY LIVEY related that federal welfare reform proposals contain a
provision that would allow Indian tribes to provide welfare
services directly to their tribal members. In Alaska, each village
is a tribe, so in Alaska, the term "Indian tribe" is defined as
meaning a regional corporation. Therefore, there would not be 200
different AFDC programs, there would be at a maximum of 12.
SENATOR KELLY asked if there was any reason why all 12 regional
corporations wouldn't take advantage of that provision. JAY LIVEY
answered that he thinks most tribes want to do it, and when the
committee takes public testimony on the legislation, he believes
that some of the tribes will be discussing that. He added that the
considerations are that the administrative responsibilities are
still fairly fierce in terms of meeting the reporting requirements
of federal law, even under the new block grant proposal. When the
cost of setting up administration versus the number of recipients,
etc., are considered, some tribes may just not be willing to take
that on. SENATOR KELLY commented that he could not imagine them
not wanting that to happen because this would mean jobs that could
be handled by the tribal members. JIM NORDLUND added that the idea
needs a lot more development, and one of his concerns is that just
the administrative infrastructure that it takes to do eligibility
alone is very costly and some of the smaller organizations may not
have enough recipients to pay for an eligibility system.
SENATOR KELLY asked if the provision is Native-specific only.
CURTIS LOMAS answered that the way the bill reads is that if a
corporation takes one of these block grants, their obligation is to
serve all Alaska Native and American Indian people who live within
the boundaries of the ANCSA region, regardless of their tribal
affiliation. He added that the American Indian population in the
AFDC caseload represents approximately one percent of the total.
SENATOR KELLY asked if there is going to be a finite number that
each of these 12 corporations are responsible for dollar wise. JAY
LIVEY answered that the way the current federal law is proposed,
the state would receive a block grant that is the amount of money
that was received for AFDC in 1994. However, if for some reason
the number of people that required benefits happened to increase,
there would be more people to serve with the same amount of money.
SENATOR KELLY'S concern is the 12 potential organizations that
might not feel the same pressures to come in at a budget that the
department comes in at and then will need more money. He asked
where the checks and balances are against that happening. JIM
NORDLUND said he thought the checks and balances would be the same
that the state would face and that is that there is basically no
more money. If they come to the department seeking more money and
if it is given to them, it has got to come out of the pot of the
rest of the people that AFDC is supposed to be taking care of. JAY
LIVEY pointed out that there is no requirement in the federal law
that the state provide a match to the Indian tribes should they
take on responsibility for their members, but the department
believes that there should be some level of general fund
appropriation to help that tribe provide services because they are
essentially taking cases away from the state and lowering the
state's obligation.
Number 200
SENATOR TORGERSON commented that there had been discussion earlier
about other nonprofits, as well as local governments, being
eligible to administer the state's portion of this program. The
question is how much competition are we actually trying to create
and how are these dollars going to be tracked through whatever it
is that we're trying to accomplish.
Number 300
SENATOR ZHAROFF commented that corporations that he has dealt with
have very limited resources and most of them are dependent upon
either state or federal dollars or private contributions. He said
they have been going through staff reductions, cutting expenses,
etc., just like everybody else.
Number 330
JAY LIVEY said the tribal representatives have said their concern
has been that the AFDC program, as currently configured, is not a
program that is particularly beneficial to rural Alaska. By
providing some kind of regional control, and through that more
local control, the program could be designed to be more beneficial
for rural Alaska in terms of job creation and job and work
activities that are more related to subsistence kinds of lifestyle
and those kinds of issues.
Number 410
SENATOR ZHAROFF asked if the state would have to provide matching
money. JAY LIVEY said he assumed the Native organizations that
would want to do this would need to get the state complement to
what they get from the federal government in order to run an
effective program. However, he also pointed out that the federal
law says that the state currently has to match up to 80 percent of
the federal contribution, but it doesn't say anything about the
state having to make a match if a Native organization decides to
pursue this.
Number 454
SENATOR KELLY asked how much the state's obligation would be in
matching general fund dollars. JAY LIVEY responded it would be 80
percent of what the general fund match was in FY 94, which would be
80 percent of approximately $68 million.
CURTIS LOMAS said the state basically is not required to
participate in this program at all. The 80 percent match is a
condition of the state getting a block grant, and, if the state is
not willing to provide that level of state funding, then we
basically don't have the federal block grant. However, the Native
portion could continue because that relationship would be directly
between the federal government and the tribal government.
Number 500
SENATOR TORGERSON said he is not opposed to the Native
organizations doing this, but he is concerned about the widely
disparate programs because the funding level available to the
Native organizations and to the state would be vastly different.
There is no definition of comparable services for Native or non
Native. JIM NORDLUND pointed out that there is the provision in
the federal bill that requires comparability of programs or
comparability of benefits.
SENATOR TORGERSON asked if there are federal matching dollars for
the jobs training program. JIM NORDLUND replied that there isn't
a federal share. The department is requesting the same level of
appropriation this year for AFDC, $130 million, but because they
have seen a reduction in caseload, they anticipate paying $122
million in benefits and they are asking the Legislature to put the
difference of $8 million into job training and child care.
SENATOR ZHAROFF asked how this whole program fits into communities
like Kodiak that experience seasonal unemployment because of the
way the allocations are handled in the offshore fisheries. JIM
NORDLUND responded that one of the things in the bill that deals
with the seasonality of employment in Alaska is to make reductions
to two-parent families in the summer when work is available to
those families.
TAPE 96-2, SIDE A
Number 035
SENATOR TORGERSON turned the discussion to local government
involvement as possibly being the contractor to administer part of
the program. He said a lot of the concern he has comes back to the
authority of local governments to even get involved administering
any part of this bill, and whether they have the statutory
authority to do so. The three elements that would be eligible to
contract with the department to administer the program would be the
regional corporations, the local governments and other nonprofits.
JAY LIVEY said the way the bill is currently written, it
essentially permits the department to contract for various pieces
of the program with nonprofit organizations, or tribes, or
municipalities. It doesn't mandate that any of those entities
become involved if they don't wish to. He pointed out that the
current program has contracts with nonprofit organizations, and
most of those contracts have to do with providing various kinds of
jobs-related services.
Number 060
SHANNON O'FALLON , Assistant Attorney General, Human Services
Section, Department of Law, said AS 29.35.010 talks about the
general powers of municipalities, but she agreed with Senator
Torgerson's concern that Title 29 should be amended to ensure that
first and second class boroughs have the authority to contract with
the state to do this.
SENATOR TORGERSON pointed out that the amendment should include
second class cities, third class cities, etc.
Number 175
GLENDA STRAUBE , Director, Child Support Division, Department of
Revenue, said one of the things that is very clear in the federal
welfare reform is a tougher approach to child support enforcement
in relationship to public assistance. One way to increase the
collections is through what is called the occupational drivers
license bill, and this section is within the Governor's bill. When
an individual applies for an occupational license or goes in for a
renewal, the Child Support Division will be matching up with
Occupational Licensing their list of people who are not in
compliance on their child support payments. Those individuals who
are not in compliance will be issued a temporary license and will
then have to work out a payment plan for back child support. A
similar process will apply for drivers licenses. The legislation
also contains a provision which provides a heightened
responsibility for grandparents.
Number 156
SENATOR TORGERSON said the occupational license provision makes
sense to him, but the drivers license provision is a pretty far
reaching change in policy, and he asked if this is something that
is done in other states. GLENDA STRAUBE clarified that the
occupational license provision also includes the drivers license.
A year ago approximately 17 other states had this provision. She
pointed out that the federal welfare reform bill is even stricter
than this legislation, and although the provision in this bill is
far reaching, it recognizes the fact that people really need to
support their children.
Number 194
There being no further testimony on SB 206, SENATOR TORGERSON said
the legislation would be scheduled for another committee hearing at
which time the committee will focus in on sections relating to
local government issues. He then adjourned the meeting at 3:26
p.m.
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