Legislature(1999 - 2000)
03/08/1999 01:35 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
March 8, 1999
1:35 p.m.
MEMBERS PRESENT
Senator Tim Kelly, Chair
Senator Jerry Ward
Senator Lyman Hoffman
MEMBERS ABSENT
Senator Jerry Mackie, Vice Chair
Senator Randy Phillips
COMMITTEE CALENDAR
SENATE JOINT RESOLUTION NO. 12
Relating to new evaluation and selection criteria for military base
realignment and closure actions.
-MOVED SJR 12 OUT OF COMMITTEE
SENATE BILL NO. 80
"An Act relating to contracts for the provision of state public
assistance to certain recipients in the state; providing for
regional public assistance plans and programs in the state;
relating to grants for Alaska tribal family assistance programs;
and providing for an effective date."
-HEARD AND HELD
PREVIOUS SENATE COMMITTEE ACTION
SJR 12 - No previous Senate action.
SB 80 - No previous Senate action.
WITNESS REGISTER
Chris Nelson, Committee Aide
Joint Committee on Military Bases
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Testified in support of SJR 12.
Jim Nordlund, Director
Division of Public Assistance
Department of Health & Social Services
PO Box 110640
Juneau, AK 99811-0640
POSITION STATEMENT: Testified in support of the proposed committee
substitute for SB 80
Terry Hoefferle, Executive Officer
Bristol Bay Native Association
PO Box 310
Dillingham, AK 99576
POSITION STATEMENT: Testified in support of the proposed committee
substitute for SB 80
Michael Walleri
Tanana Chiefs Conference
2518 Riverview Drive
Fairbanks, AK 99709
POSITION STATEMENT: Testified in support of the proposed committee
substitute for SB 80
Don Shircel
Tanana Chiefs Conference
2518 Riverview Drive
Fairbanks, AK 99709
POSITION STATEMENT: Testified in support of the proposed committee
substitute for SB 80
ACTION NARRATIVE
TAPE 99-4, SIDE A
Number 001
CHAIRMAN TIM KELLY called the Senate Community & Regional Affairs
Committee meeting to order at 1:35 p.m. Present were Senators
Ward, Hoffman, and Kelly, Chair. The first order of business
before the committee was SJR 12.
SJR 12-MILITARY BASE REALIGNMENT/CLOSURE ACTIONS
CHRIS NELSON, staff to the Joint Committee on Military Bases,
stated the Secretary of Defense recently asked Congress to
authorize two new rounds of Base Realignment and Closure (BRAC)
actions to occur in 2001 and 2005. SJR 12 asks Congress to
consider a thorough review of the entire BRAC process. Previous
BRAC evaluations overlooked the key modern strategic factor of
total force considerations. Alaska military bases were shortchanged
during those evaluations. SJR 12 asks Congress to form joint
cross service study groups to look at power projection, joint
training and operations, and to make recommendations to the new
BRAC Commission to reflect the fact that the structure of military
forces has changed and that military bases must now move toward a
total force orientation.
CHAIRMAN KELLY stated SJR 12 asks that the BRAC Commission use new
criteria to consider the proximity and cooperation between army and
air force bases. The two combined bases have more strength than
individual bases situated in distant locations. The new criteria
will better reflect the strength of Alaska's military bases, which
is their proximity, and deflect from their weakness, which is a
higher operational cost.
There being no further testimony, SENATOR WARD moved SJR 12 out of
committee with individual recommendations. There being no
objection, the motion carried.
Number 107
SB 80-PUB.ASSISTANCE:PROGRAMS/GRANTS/CONTRACTS
CHAIRMAN KELLY announced the proposed CSSB 80(CRA), identified as
work draft 1-GS1011\D, had been circulated and would be addressed
today in lieu of the original bill. He further announced the
committee would not take action on the legislation today, but would
begin the hearing process. He added SB 80 was introduced by the
Senate Rules Committee at the request of the Governor.
JIM NORDLUND, Director of the Division of Public Assistance,
Department of Health and Social Services (DHSS), gave the following
overview of the proposed committee substitute. The 1996 federal
welfare reform law enabled tribal non-profit organizations to
administer regional welfare programs. Each state receives a
federal block grant: Alaska's block grant could be administered by
all or some of the thirteen Native organizations specifically named
in the federal legislation. Prior to 1996, the Alaska Families
with Dependent Children (AFDC) program was funded with a 50/50
match of state and federal funds. The 1996 federal law no longer
requires a 50 percent state match; it requires states to provide a
maintenance of effort (MOE) which, in Alaska, will equal 80 percent
of the state's AFDC match in FY 94. States however, are not
required to provide MOE's for Native-run programs. CSSB 80(CRA)
allows state funds to be used to contribute to a Native non-profit
program.
MR. NORDLUND noted that at present, the State has a grant agreement
with the Tanana Chiefs' Conference (TCC) to administer the Alaska
Temporary Assistance Program (ATAP) in the Interior region. In
1997, TCC submitted a proposal to the federal government to run a
Native program designed around a bill before the Legislature last
year allowing TCC to also receive State funds. After the bill did
not pass, the Department of Law reviewed the situation and
determined that if TCC's program is essentially the same as the
State's program, DHSS could provide state funds to TCC under its
granting authority. CSSB 80(CRA) goes one step further and allows
Native organizations, eligible for federal funds for welfare reform
programs, to also receive state funding to run customized welfare
programs that are comparable, but differ, from ATAP. State funds
transferred to Native organizations would otherwise be used to
serve the same clientele through a program administered by DHSS,
therefore no cost increase is associated with this legislation.
CHAIRMAN KELLY asked whether CSSB 80(CRA) merely sets up a
competing organization to provide services provided by DHSS. MR.
NORDLUND replied it does not; it sets up locally administered,
culturally relevant programs akin to school districts.
CHAIRMAN KELLY asked if the program would serve Native recipients
only. MR. NORDLUND explained the bill allows Native organizations
to serve non-Native clients in their regions as well.
CHAIRMAN KELLY questioned why DHSS will continue to need employees
for these programs if Native organizations will be taking over
those duties, and why the bill does not have a negative fiscal
note. MR. NORDLUND answered if many Native organizations decide to
participate, DHSS expects a reduction in its administrative staff,
but DHSS cannot predict at this time how many Native organizations
will take advantage of this opportunity.
Number 237
SENATOR WARD asked Mr. Nordlund to elaborate on the 13 non-profit
organizations. MR. NORDLUND clarified the federal welfare reform
law, at Senator Murkowski's request, specifically names the 12 non-
profit regional corporations and the Metlakatla community.
SENATOR WARD asked whether this legislation prevents a certified
group with a non-profit branch from receiving funds. MR. NORDLUND
replied the federal law allows only the 13 named organizations to
receive federal funds, therefore state funds could only be
allocated to those organizations.
SENATOR WARD questioned whether the bill limits the amount of funds
used for administrative costs. MR. NORDLUND answered the federal
law contains a 20 percent limit on federal funds but CSSB 80(CRA)
contains no limit on state funds.
Number 256
MR. TERRY HOEFFERLE, Executive Officer of the Bristol Bay Native
Association (BBNA), gave the following testimony via teleconference
from Dillingham. Most of the 13 regional organizations were
created over 30 years ago to work for resolution of Native land
claims in Alaska. The regional boundaries correspond to the
regional for-profit ANCSA corporation boundaries. The regional
non-profit and for-profit organizations are very separate and
distinct from each other. The 12 non-profit organizations named in
the federal legislation are: the Arctic Slope Native Association,
Manilaq, Kawerak, Doyon, the Association of Village Council
Presidents, BBNA, Cook Inlet Tribal Council, Copper River Native
Association, Chugach, Kodiak Area Native Association, the Aleutian
Pribilof Islands Association, and Tlingit Haida Central Council.
Collectively, those organizations receive over $400 million
annually to provide services from several federal agencies with
separate program and reporting requirements. The non-profit
organizations also run several state-funded programs, such as
Healthy Families. BBNA's 1999 budget is $16 million; it runs 42
programs and provides services in 32 villages. Of BBNA's 302
employees, 234 are employed in the villages. The local non-profit
organizations have experience in work training programs and
knowledge of the people and resources of their regions. With this
knowledge, they are better able to get people off of welfare and
back to work than a state agency.
Number 367
CHAIRMAN KELLY asked if funds were made available for the welfare
reform program in FY 97. MR. NORDLUND replied the federal
legislation was signed into law in August of 1996. Many states
implemented their welfare plans that same day and any Native
organization could have submitted a plan to the federal government
for approval. Alaska implemented its program on July 1, 1997.
CHAIRMAN KELLY asked whether the Alaska Native non-profit
organizations will be eligible for federal funds if CSSB 80(CRA)
does not pass. MR. NORDLUND clarified they are already eligible to
receive federal funds. TCC received funds directly from the
federal government on October 1, 1998 but it is the only
organization to do so at this time.
CHAIRMAN KELLY asked if the others are not as far advanced in the
design and application process as TCC. MR. NORDLUND said that is
correct.
MR. HOEFFERLE added while BBNA is eligible to receive federal
funds, it does not believe it is able to offer a program comparable
to the state's program with only half of the funding. CSSB 80(CRA)
will allow the state to match the federal dollars.
CHAIRMAN KELLY questioned why TCC is receiving state funds. MR.
NORDLUND clarified TCC had to amend its original plan to make it
identical to the state's program in order to receive state funds.
CSSB 80(CRA) will allow DHSS to fund programs that are comparable,
but not identical, to the state's program. TCC originally wanted
to reduce benefits by five percent and use the five percent to fund
drug and alcohol treatment programs for clients. Because that
would depart from the state's program, TCC had to modify its plan
and remove that provision.
Number 397
CHAIRMAN KELLY asked if the state's funding amount is a direct
50/50 match of federal funds. MR. NORDLUND said it was prior to
1996, but the 1996 federal law requires the state to contribute 80
percent of its FY 94 general fund amount. This year, the program
funds consist of about 60 percent federal funds and 40 percent
state funds.
SENATOR WARD questioned whether the TCC welfare reform program has
been audited and whether any public hearings have been held to
measure public opinion about TCC's delivery of services. MR.
NORDLUND noted TCC's program began operating January 1, 1999,
therefore no audits or hearings have occurred.
SENATOR WARD questioned whether DHSS has a mechanism in place to
deal with complaints about the delivery of services. MR. NORDLUND
replied TCC is a grantee of the State therefore DHSS auditing
requirements apply. DHSS also requires a dual appeal process:
individuals first appeal directly to TCC; if unsatisfied with the
resolution they may then appeal to DHSS.
SENATOR WARD asked if anyone has appealed, and whether clients are
aware of the appeal process. MR. NORDLUND said all clients are
notified of their right of appeal.
Number 429
SENATOR HOFFMAN asked Mr. Nordlund to elaborate on the state's
fixed funding level. MR. NORDLUND explained the 1996 federal law
changed the funding mechanism from a formula-based entitlement to
a block grant. Each states' block grant is limited to 80 percent
of the amount it spent for state welfare programs in FY 94.
SENATOR HOFFMAN asked if the amount of the block grant remains
constant whether the state contracts with a tribal entity or
administers its own program. MR. NORDLUND said it does, however
the state amount is based upon the tribal entity's proportion of
the caseload in a given year, and it will be proportional to the
general fund amount appropriated by the Legislature each year.
CHAIRMAN KELLY asked Mr. Nordlund to provide the section of the
federal law that relates to the FY 94 funding level.
Number 456
MICHAEL WALLERI, TCC, gave the following testimony via
teleconference from Fairbanks. TCC supports CSSB 80(CRA) but plans
to propose two amendments. TCC is a regional tribal consortium,
operating social service programs since 1972. TCC assumed
operation of the Bureau of Indian Affairs (BIA) general assistance
program in 1986, and developed the model which eventually became a
national program known as the Tribal Work Incentive Program (TWIP).
Under a transition agreement with DHSS, TCC jointly operated its
welfare reform program with DHSS from October 1, 1998 until January
1, 1999, at which time TCC took over. TCC now serves 450 Native
families in 37 federally recognized tribes. Its geographical area
is the largest area served in the United States. Under TCC's new
program, 35 percent of clients served in rural communities are now
employed (a 35 percent increase). One stop service centers have
been created in all 39 rural communities and in Fairbanks. The
State envisioned a system of one-stop service centers in its plan
but never implemented it. To date, no TCC clients have filed
appeals internally, or with DHSS.
MR. WALLERI said TCC supports CSSB 80(CRA) because the legislation
will enable regional non-profit organizations to further improve
the system. TCC amended its original plan to meet the substantial
similarity rule identified by the Department of Law, a standard
more stringent than the federal law requiring Native programs to be
comparable, not identical. TCC wanted to implement not only the 5
percent benefit reduction, but also mandatory alcohol and substance
abuse evaluations for recipients, stronger sanctions for non-
compliance with the work incentive requirement, and incentives for
parents to promote both local health screening of children and
parental participation in parent-teacher conferences. TCC would
also like to provide a $50 incentive for cooperation with child
support enforcement issues. Enactment of CSSB 80(CRA) will allow
TCC to implement those provisions.
MR. WALLERI discussed the changes made in the proposed committee
substitute. The time line for the notice of retrocession was
changed from 180 to 120 days to be consistent with the federal time
line. A six month start-up period was included which is consistent
with the federal law. He noted TCC supports Section 7, which
allows TCC to continue to implement its current program with the
two year grant it received from DHSS.
MR. WALLERI described TCC's first proposed amendment. Subsections
A - F on page 6, lines 3-22, contain the comparability standards
for the tribal and Alaska programs. TCC prefers that Subsection
(E) be substituted with the comparability standard negotiated with
DHSS Commissioner Karen Perdue. Under the federal program, tribal
programs are to receive child support assignments. TCC and the
State of Alaska are currently working to amend federal policy to
allow agreements about how those assignments are handled. The
amended federal policy will allow a tribal-state agreement to
govern the distribution of child support assignments.
MR. WALLERI noted TCC's second proposed amendment would add a new
section to read:
The receipts of assistance from programs operated under
grant or contract pursuant to AS 47.27.071 or AS
47.27.072 shall not be the basis for denial of services
provided by the department that are not funded from
appropriations for the state public assistance program
administered under this chapter.
He explained the section would clarify that families eligible for
assistance from regional non-profit organizations would not
automatically be denied services from the state for programs that
are not included in the non-profits' contracts. He suggested
including a non-discrimination clause to prevent incidents similar
to those that occurred during the transition phase.
TAPE 99-4, SIDE B
CHAIRMAN KELLY asked for an example of a benefit that a TCC
assistance recipient might apply for from the State.
DON SHIRCEL, Director of Family Services, TCC, indicated child care
assistance or work orientation services were denied to TCC
recipients because of a misunderstanding. State programs operated
under the assumption that recipients of assistance from tribal
programs were no longer eligible for State services.
MR. WALLERI stated other examples of state assistance include food
stamps and Medicaid. Those programs are funded through different
federal programs and can only be administered by the State.
Number 561
SENATOR WARD asked if TCC would be opposed to a provision
prohibiting disbursement of state funds to a non-profit
organization controlled by a for-profit organization.
MR. WALLERI replied he was unsure who that provision would apply
to, but that it would not apply to TCC. TCC's non-profit
organization is controlled by a separate, independently-elected
board, comprised of, and elected by, the village councils in the 37
tribal communities.
CHAIRMAN KELLY questioned whether any of the 13 Native non-profit
organizations are controlled by the 13 for-profit corporations.
MR. HOEFFERLE stated he believes, with the exception of the Cook
Inlet Tribal Council, all of the regional non-profit organizations
are controlled by boards of directors whose members are appointed
by the village councils in the communities they represent. He
thought the Cook Inlet Tribal Council may have a slightly different
arrangement.
SENATOR WARD stated he believes the Cook Inlet Tribal Council is
controlled by its for-profit arm. He suggested the committee
pursue that question before allowing state funds to be disbursed to
it.
SENATOR WARD again asked if any recipients of TCC's services have
appealed to TCC about the delivery of those services. MR. SHIRCEL
replied TCC program staff have received many calls from
individuals, some irate that they are required to work 20 hours per
week to receive welfare benefits. However, no formal appeals have
been filed. SENATOR WARD said he has also received calls, some
identical to those described by Mr. Shircel.
Number 515
CHAIRMAN KELLY indicated this legislation will allow the state to
contract some services out, yet the fiscal note contains no
assurance that a savings will result. He asked if the bill will
create a new general fund expense. MR. NORDLUND said it will not.
Existing funds from the Division of Public Assistance will be
transferred to another component, entitled the Native Family
Assistance Fund. If some of the larger organizations, such as
Tlingit and Haida Central Council, apply to run their own programs,
the Division of Public Assistance's administrative abilities would
be reduced.
CHAIRMAN KELLY cautioned it will be like pulling teeth to get DHSS
to admit it does not need the same number of administrative
employees. MR. NORDLUND said he appreciated the Chairman's
concern, but he pointed out the unique funding mechanism should
assure the committee that no new costs will arise. The federal
block grant amount will remain static, as well as the state's
share. He clarified the federal portion will increase by 2+ percent
each year because Alaska, as well as 16 other states, are
considered "high population states."
SENATOR WARD suggested if the federal government gave the state $10
which was handed to TCC, and the state did not incur any
administrative costs in that transfer, the state would save money,
therefore, the state's savings on administrative costs could be
added to the amount given to TCC.
MR. NORDLUND replied that is what will happen. DHSS is
transferring not only the benefit dollars, but the administrative
dollars as well. SENATOR WARD asked Mr. Nordlund to provide a
model of that process for committee members.
MR. WALLERI clarified federal funding does not increase based on
population increases or incentive payments. In determining the
state's share of administrative costs, two line items in the state
budget are used. The first is ATAP, the second is the state's
administrative costs. The total share of those two line items
passed to TCC through a grant of ATAP benefit money. That amount
was capped in a remarkable agreement requiring all of that money to
be paid directly to beneficiaries. TCC must use other funds to pay
administrative costs. Such an agreement is remarkable in that 100
percent of state funds must be used to pay ATAP beneficiaries.
CHAIRMAN KELLY asked if the 13 organizations are designated in CSSB
80 (CRA) by name. MR. NORDLUND said they are by reference to the
federal law.
There being no further testimony, CHAIRMAN KELLY announced CSSB
80(CRA) would be scheduled for a second hearing. He adjourned the
meeting at 2:37 p.m.
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