Legislature(1999 - 2000)

04/26/1999 09:06 AM Senate FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
MINUTES                                                                                                                         
SENATE FINANCE COMMITTEE                                                                                                        
April 26, 1999                                                                                                                  
9:06 AM                                                                                                                         
                                                                                                                                
TAPES                                                                                                                           
                                                                                                                                
SFC-99 # 110, Side A and Side B                                                                                                 
                                                                                                                                
CALL TO ORDER                                                                                                                   
                                                                                                                                
Co-Chair John Torgerson convened the meeting at                                                                                 
approximately 9:06 AM.                                                                                                          
                                                                                                                                
PRESENT                                                                                                                         
                                                                                                                                
Senator John Torgerson, Senator Sean Parnell, Senator Randy                                                                     
Phillips, Senator Gary Wilken, Senator Al Adams and Senator                                                                     
Pete Kelly were present when the meeting convened.  Senator                                                                     
Dave Donley arrived later.  Senator Loren Leman was absent.                                                                     
                                                                                                                                
Also Attending:                                                                                                                 
                                                                                                                                
ALISON ELGEE, Deputy Commissioner, Department of                                                                                
Administration; JIM BALDWIN, Assistant Attorney General,                                                                        
Governmental Affairs Section, Civil Division, Department of                                                                     
Law; KAREN PERDUE, Commissioner, Department of Health and                                                                       
Social Services; ELMER LINDSTROM, Special Assistant, Office                                                                     
of the Commissioner, Department of Health and Social                                                                            
Services; BOB BRIGGS, Staff Attorney, Disability Law Center                                                                     
of Alaska; TIM WEISS, Program Director and Past President,                                                                      
Parent's Incorporated; MANYA KONGOWYIE (last name spelling                                                                      
not provided), Developmental Disability Specialist; KEN                                                                         
DANE (last name spelling not provided), Independent Living                                                                      
Specialist; BARRY BURNETT; CHERYL HALL, Alaska Independent                                                                      
Living; WALTER MAJOURIS, Executive Director, Mental Health                                                                      
Board; JEFF JESSEE, Executive Director, Alaska Mental                                                                           
Health Trust Authority;                                                                                                         
                                                                                                                                
Attending via Teleconference: From Anchorage: HEATHER                                                                           
FLYNN, UAA Adult Learning Center; JAN MCGILLIVARY, Chief                                                                        
Executive Officer, Alaska Mental Health Association, and                                                                        
Coordinator, Building Bridges Campaign for Mental Health;                                                                       
GAIL IGO, President, Anchorage Foster Care Association and                                                                      
Member, Statewide Foster Care Association; ERNEST DUMMANN;                                                                      
From Fairbanks: MONTA LANE, Alaska Caregivers; GENE GRASTO;                                                                     
JEANETTE GRASTO, President, National Alliance for the                                                                           
Mentally Ill - Alaska; From Kenai: LEIGH HAGSTROM-SANGER,                                                                       
Frontier Community Services; EDWARD MARTIN, SR.; WINI                                                                           
CROSBY; HOLLI KRISTIANSEN; From Mat-Su: SANDRA ADAMS; JO                                                                        
RENK; JOHN CANNON, Member, Key Coalition, and Lifequest;                                                                        
From Sitka: MOIRA MCBRIDE, Occupational Therapist                                                                               
                                                                                                                                
SUMMARY INFORMATION                                                                                                             
                                                                                                                                
HB 161-REDUCTIONS IN BENEFIT PROGRAMS                                                                                           
                                                                                                                                
The committee heard from the Department of Health and                                                                           
Social Services, the Department of Law and the Department                                                                       
of Administration. Public testimony was taken. The bill was                                                                     
held in committee.                                                                                                              
                                                                                                                                
                                                                                                                                
CS FOR HOUSE BILL NO. 161(FIN)(efd fld)                                                                                         
"An Act relating to reduction in payments to                                                                                    
individuals under certain benefit programs."                                                                                    
                                                                                                                                
                                                                                                                                
KAREN PERDUE, Commissioner, Department of Health and Social                                                                     
Services testified in opposition to the bill.  She felt                                                                         
there were issues that had not been fully explored when it                                                                      
was heard in the House of Representatives. The bill eroded                                                                      
decades of statutory protections for thousands of the most                                                                      
vulnerable Alaskans. It was one of the most far-reaching                                                                        
bills she believed the Legislature would address this                                                                           
session.                                                                                                                        
                                                                                                                                
In her opinion, the biggest problem was that provisions of                                                                      
the bill were so vague that the implementing agencies were                                                                      
unsure how to execute them. Therefore, she thought it was                                                                       
poorly executed and was too broad of an approach. She                                                                           
recommended the committee should slow down and take a look                                                                      
at some of the issues raised.                                                                                                   
                                                                                                                                
As one who would be expected to execute the bill, she had                                                                       
two questions. "What programs would this apply to and how                                                                       
would it work?" When she asked that question of the co-                                                                         
chair of the House Finance Committee and was told "No                                                                           
programs come to mind." There was no clear statement on the                                                                     
record to reflect the Legislature's intent.                                                                                     
                                                                                                                                
She noted the bill had received limited public input in the                                                                     
House of Representatives. There was only one evening                                                                            
hearing and the House Finance Committee did not accept                                                                          
testimony on the committee substitute.                                                                                          
                                                                                                                                
Her interpretation of the bill was that the agency was to                                                                       
reduce the amount of payments to individuals on a pro-rated                                                                     
basis if the appropriation for the benefit program was not                                                                      
fully sufficient to fund all the payments.  That was a                                                                          
simple statement.  However, she read the bill to also say                                                                       
that no supplementals would be allowed for these programs.                                                                      
                                                                                                                                
She pointed out that supplementals occurred frequently in                                                                       
formula programs and that the bill would result in benefit                                                                      
reductions as early as next year. She shared her vision of                                                                      
formula programs as a special category of programs given                                                                        
extra care in state and federal statutes to define criteria                                                                     
of age, income, disabilities, medical conditions and                                                                            
children in foster care. The intent is that when an                                                                             
individual meets the criteria, the programs will serve                                                                          
them.                                                                                                                           
                                                                                                                                
It was determined that these programs were so important                                                                         
that waiting lists were inappropriate. They addressed basic                                                                     
life, health and safety needs of food, shelter or the                                                                           
safety of children in the case of foster care.                                                                                  
                                                                                                                                
She addressed the requirement for the agencies to prepare                                                                       
formula estimates nearly eighteen months in advance of the                                                                      
end of the fiscal year. This was guessing far into the                                                                          
future about how many people would need assistance with                                                                         
these services.  These projections were always wrought with                                                                     
uncertainty and there was tremendous discussion in the                                                                          
budget subcommittees about the accuracy of the predictions.                                                                     
There was debate on the merits of conservative versus                                                                           
liberal estimates. The Legislature and the Governor had                                                                         
more recently determined that it was more advantageous to                                                                       
underestimate rather than overestimate demand due to                                                                            
federal funding requirements. Therefore, the supplemental                                                                       
was consistently used to correct shortages in calculations.                                                                     
                                                                                                                                
It was impossible to accurately predict the exact need of                                                                       
funding for each program.                                                                                                       
                                                                                                                                
She spoke to some of the programs that would be affected.                                                                       
This included the Longevity Bonus Program, foster care,                                                                         
subsidized adoption and adult public assistance, all of                                                                         
which had been conservatively estimated as to their funding                                                                     
requirements for FY00.                                                                                                          
                                                                                                                                
She compared the funding formulas to building construction,                                                                     
where allowances were made for changes, cost-overruns, and                                                                      
unforeseen expenses.                                                                                                            
                                                                                                                                
Some of the programs were subject to the state of the                                                                           
economy. If the state suffered an economic downturn, the                                                                        
demand for services would go up.                                                                                                
                                                                                                                                
She detailed the adult public assistance programs and the                                                                       
people it served. It was the state's supplement to social                                                                       
security. Many participants in this program were not                                                                            
qualified for social security benefits. The eligibility of                                                                      
the program was tied to Medicaid and required the recipient                                                                     
to be very poor with little assets. Therefore, these                                                                            
participants would not be able to make up for a reduction                                                                       
in benefits from their personal finances.                                                                                       
                                                                                                                                
She warned that this legislation could result in the loss                                                                       
of Medicaid coverage for many participants.                                                                                     
                                                                                                                                
Another program was the Alaska Temporary Assistance Program                                                                     
(ATAP).  She told of the recent reductions in the cost of                                                                       
operating the program due to the rewrite of the Welfare                                                                         
Bill. Half of the participants in the program were                                                                              
currently working, which resulted in reductions in the                                                                          
payments and savings to the state. Wages were replacing the                                                                     
payments. She stressed that this was the way an entitlement                                                                     
program should be done.                                                                                                         
                                                                                                                                
Further reductions to this program would result in the                                                                          
state violating its "Maintenance of Efforts" and cause                                                                          
significant financial penalties. The bill did not make                                                                          
allowances for federal penalties.                                                                                               
                                                                                                                                
The program also serviced "child-only" situations where                                                                         
someone was caring for a child other than a legal guardian                                                                      
or foster parent.  These cases were held harmless for work                                                                      
requirements. She wanted to know if it was the intent of                                                                        
the bill to reduce payments for these children also.                                                                            
                                                                                                                                
[RECORDING INTERRUPTION - APPROX. 10 SECONDS]                                                                                   
                                                                                                                                
She spoke of poor elderly participants that the department                                                                      
paid Medicaid premiums for.  She wanted to know if this was                                                                     
considered an individual benefit, or if it would be exempt.                                                                     
                                                                                                                                
The Legislative Legal Services Division raised concerns                                                                         
about other programs, such as state employee health                                                                             
benefits and worker's compensation payments.                                                                                    
                                                                                                                                
She continued by saying that there was great confusion on                                                                       
the effective date of the bill. The bill stated that it was                                                                     
to go into effect July 1999. The effective date did not                                                                         
pass the House of Representatives so it could go into                                                                           
effect ninety days after that. However, the House Finance                                                                       
Committee co-chair was quoted in the media as saying that                                                                       
this would not affect payments this year.  She didn't see                                                                       
how that was possible when the caseload estimates were so                                                                       
conservative in many of the formula programs.                                                                                   
                                                                                                                                
[RECORDING DIFFICULTIES]                                                                                                        
                                                                                                                                
She surmised that because the bill gave a mandate that the                                                                      
agencies "shall" reduce benefits.  Therefore, it did not                                                                        
matter what direction the committee gave as to intent; the                                                                      
letter of the law would have to be followed.                                                                                    
                                                                                                                                
She had been asked her preference of whether to pro-ration                                                                      
payment amounts or to simply cease payments when the funds                                                                      
ran out. She had never had a serious public discussion with                                                                     
any member of the Legislature about completely cutting off                                                                      
benefits.  She hoped this Legislature would not consider it                                                                     
either. She felt this was the last area the government                                                                          
should cut because participants were unable to cover the                                                                        
shortfalls. The department considered it a failure if a                                                                         
benefit check arrived one or two days late since the                                                                            
participants relied on the money.                                                                                               
                                                                                                                                
She compared the matter to expenditures for the Y2K issue.                                                                      
                                                                                                                                
Logistics and timing were a big issue. She wanted to know                                                                       
if the Legislature intended the department to prorate                                                                           
several times a year or once a year. One of the impacts                                                                         
could be caused if the department was over conservative and                                                                     
pro-rated too much.                                                                                                             
                                                                                                                                
Only the Longevity Bonus Program was clear in how this                                                                          
provision could be applied. That was because the bill                                                                           
language stated, "programs that have already had a pro-                                                                         
rationing factor would not be included." She wondered if                                                                        
that meant the Legislature intended to continue to honor                                                                        
the formula nature of foster care.  There were statutory                                                                        
protections in many of the programs addressing the basic                                                                        
income standards so participants could meet their expenses.                                                                     
                                                                                                                                
She thought it was clear that the Legislature had the                                                                           
authority and the ability to do statutory reform of                                                                             
entitlements. It had been done in the Longevity Bonus                                                                           
Program and the ATAP program thoughtfully and carefully.                                                                        
                                                                                                                                
This bill lacked a couple features present in the past                                                                          
reform bills. First, it gave sufficient notice of two                                                                           
years.  It also tended to not cut off participants who                                                                          
currently depended upon payments.                                                                                               
                                                                                                                                
There would be substantial cumulative effects for                                                                               
participants who had limited alternatives. If the Longevity                                                                     
Bonus Program and the ATAP were both prorated and the                                                                           
senior property tax exemption bill was adopted and                                                                              
municipalities took advantage of that.  The impact on an                                                                        
elderly person would be tremendous.  That was why it was                                                                        
important to do changes in a statutory manner looking at                                                                        
all the options.                                                                                                                
                                                                                                                                
She recommended that this bill needed review. She did not                                                                       
feel individuals were overpaid.                                                                                                 
                                                                                                                                
Senator Pete Kelly said one of the things he felt motivated                                                                     
the bill were reports that showed Alaskan's benefits were                                                                       
so far ahead of other states.  He didn't know if this bill                                                                      
was the answer, but he also felt that too many people were                                                                      
pulled into the system.  When he saw outreach programs and                                                                      
inter-agency cooperation that brought in people to many                                                                         
different programs.  He described someone he knew who did                                                                       
fair with family support, and then received one benefit                                                                         
that was needed. But then she kept getting more information                                                                     
from the state about other programs she could participate                                                                       
in.                                                                                                                             
                                                                                                                                
He believed that the amounts paid in Alaska might be too                                                                        
high and that there was too much outreach. He wanted to see                                                                     
less pro-ration of medical benefits and more on the ATAP                                                                        
portion. He felt that the state should determine the amount                                                                     
it would spend on the program and begin to bring down the                                                                       
discrepancy with other states.                                                                                                  
                                                                                                                                
Karen Perdue suggested dividing the programs into those for                                                                     
people who were able-bodied and able to work currently or                                                                       
at some point in the future, and those who did not have the                                                                     
ability to support themselves. She gave children in foster                                                                      
homes as an example of those who would not be expected to                                                                       
support themselves.                                                                                                             
                                                                                                                                
The ATAP program had made substantial changes and gave time                                                                     
limits for benefits. She did not feel it was safe to say                                                                        
that the paridine of the past was the paridine of the                                                                           
future.  She felt that to allow those who could work part                                                                       
time and still be eligible for medical benefits the program                                                                     
was more successful.  Some of the programs allowed people                                                                       
to be very productive, but they needed to continue to                                                                           
qualify for medical coverage in order to do so.                                                                                 
                                                                                                                                
Senator Al Adams stated that the language of the bill was                                                                       
very broad.  He wanted to determine which programs would be                                                                     
affected and listed ATAP, Adult Public Assistance, General                                                                      
Relief Assistance, Medicaid, chronic acute medical                                                                              
assistance, foster care, subsidized adoption and                                                                                
guardianship, the Longevity Bonus Program, K-12 education                                                                       
entitlement programs. Were there any other programs, he                                                                         
asked. Karen Perdue said the listed programs were what came                                                                     
to mind. However, there had not been enough dialog with the                                                                     
Legislature to determine if there were other programs.                                                                          
                                                                                                                                
Co-Chair John Torgerson asked the effect on Medicare.                                                                           
Karen Perdue stated Medicaid was an entitlement program                                                                         
that was tied to the individual eligibility. Health care                                                                        
was not provided to anyone just because they are poor.  The                                                                     
individual had to be disabled, elderly or a child.  The                                                                         
payments were made to the providers so the interpretation                                                                       
made on the record in the House was that this legislation                                                                       
would not apply to Medicaid.  However, there were many                                                                          
questions within that assumption. One was the payment of                                                                        
Medicare premiums to the federal government for 8000                                                                            
elderly and poor Alaskans. That was cheaper than paying for                                                                     
the health care directly. Therefore, that was actually an                                                                       
individual benefit and subject to the provisions of the                                                                         
bill.                                                                                                                           
                                                                                                                                
Co-Chair John Torgerson said the bill stated "payments to                                                                       
individuals" and the witness kept referring to payments to                                                                      
programs.  He wondered if the different intents were not                                                                        
distinct to her.  Karen Perdue said it was not and                                                                              
explained that was because there were parts of the Medicaid                                                                     
program that paid premiums. She noted that the Legislative                                                                      
Legal Services Division had raised the questions about                                                                          
state employee health benefits. The bill specifically                                                                           
exempted state employee retirement benefits but not active                                                                      
employee health benefits. She was unclear if that would be                                                                      
considered an individual benefit.                                                                                               
                                                                                                                                
JIM BALDWIN, Assistant Attorney General, Government Affairs                                                                     
Section, Civil Division, Department of Law testified to the                                                                     
memorandum he had sent the committee. He had two major                                                                          
areas of legal concern with the bill.                                                                                           
                                                                                                                                
He touched on the legal framework involving formula or                                                                          
entitlement programs. The entitlement program was one where                                                                     
the beneficiaries were identified in law as having a                                                                            
mandatory right to receive the benefits. This right became                                                                      
complete where there were sufficient funds available to pay                                                                     
the benefit. When all the elements were present, the                                                                            
individual involved had a "property interest" or vested                                                                         
right that could only be deprived by due process of law.                                                                        
The purpose of the bill, in an expansive way, was to remove                                                                     
one of the three elements; the sufficient funding.                                                                              
                                                                                                                                
Past practice created the assumption that the Legislature                                                                       
would appropriate what was necessary to pay the benefits as                                                                     
stated in the law. If a specific dollar amount or a                                                                             
specific formula was stated, the legal assumption had been                                                                      
that Legislature would provide sufficient funds. A property                                                                     
right was created under that statute and an individual had                                                                      
vested rights, which were protected under the due process                                                                       
clause, the state constitution or the fourteenth amendment                                                                      
as applicable to the states under the US Constitution.                                                                          
                                                                                                                                
The other element of legal concern with the bill dealt with                                                                     
the blanket, single concept approach applied to several                                                                         
different benefit programs. It was done in a skeletal                                                                           
manner as a broad delegation of legislative power to the                                                                        
Executive Branch. He compared it to a former law in the                                                                         
Executive Budget Act where the Legislature gave the                                                                             
Executive Branch the power to reduce amounts to all                                                                             
appropriations if there was insufficient revenues. The                                                                          
Fairbanks Northstar Borough during the Sheffield                                                                                
Administration successfully challenged that law in court.                                                                       
He felt this legislation would be vulnerable to attack                                                                          
based on the findings in the previous suit because of its                                                                       
similarity. It would be a delegation of power to the                                                                            
administrator of a program to decide when funds were                                                                            
insufficient and amend the entitlement established in law.                                                                      
                                                                                                                                
Another problem was that the approach could imply the                                                                           
repeal of other statutes. Such implied repeals were not                                                                         
favored in Alaska law. He was concerned that this                                                                               
legislation, as a command to a state agency not to pay the                                                                      
benefit, may be interpreted as not interfering with an                                                                          
individual's right to receive the benefit. However, it                                                                          
would impede the recipient's right to recover in the form                                                                       
of judgements or claims against the state. He suggested the                                                                     
solution was to address specific programs individually and                                                                      
place the limitations in the enabling act for the grant                                                                         
program.                                                                                                                        
                                                                                                                                
Senator Randy Phillips wanted to know if the Legislature                                                                        
had ever implemented a pro-ration to the Executive Branch                                                                       
for various programs in the past. Jim Baldwin said there                                                                        
had been specific statutory programs where pro-ration had                                                                       
been expressly provided for.  Senator Randy Phillips asked                                                                      
for examples. He remembered the Longevity Bonus Program was                                                                     
pro-rationed at one time.  Jim Baldwin responded there was                                                                      
a provision in the General Relief Medical program to pro-                                                                       
rate, but none for the General Relief Assistance program.                                                                       
He reviewed the Adult Public Assistance and found mention                                                                       
of sufficiency of appropriations, but it was imprecise and                                                                      
would be inadequate to sustain a claim against pro-ration.                                                                      
The revenue sharing program, Power Cost Equalization and                                                                        
several other programs had pro-ration language.                                                                                 
                                                                                                                                
He warned that on the federal level, the argument relating                                                                      
to directing the provisions toward benefit programs for                                                                         
individuals was tried and failed. The court found that if                                                                       
the grantee worked on behalf of individuals, the property                                                                       
right claim was not defeated.  To say that this legislation                                                                     
applied to individuals would not necessarily protect non-                                                                       
governmental service providers. He gave an example of                                                                           
schools providing services and felt they would not be                                                                           
insulated from rights of service claims.                                                                                        
                                                                                                                                
He was hesitant to give excessive detail on the record in                                                                       
case it was held against the state during a later                                                                               
discovery. He did say the imprecision and vagueness of the                                                                      
bill was an area that concerned him a great deal as it                                                                          
would damage the ability to defend.                                                                                             
                                                                                                                                
He felt the ultimate approach would be to do this on a                                                                          
program by program basis.                                                                                                       
                                                                                                                                
Senator Randy Phillips interjected and again asked if pro-                                                                      
rationing had been done in the past.  Jim Baldwin confirmed                                                                     
that it had been done for specific programs. Senator Randy                                                                      
Phillips noted this was therefore not breaking new ground.                                                                      
                                                                                                                                
Jim Baldwin said when it was done, it removed one of the                                                                        
three elements that created the vested right and could be                                                                       
legally defended.  However, there still could be federal                                                                        
requirements that could place the state in the difficult                                                                        
position of deciding to either cease operation of the                                                                           
program or to fully fund it, he qualified.                                                                                      
                                                                                                                                
Senator Al Adams again referenced the broad language of the                                                                     
bill and asked if the state had liability exposure under                                                                        
class actions lawsuits on behalf of beneficiaries.  Jim                                                                         
Baldwin agreed with Karen Perdue's understanding of the                                                                         
testimony heard in the House Finance Committee regarding                                                                        
past instances of short-funded programs. The committee told                                                                     
the departments that certain programs would not be required                                                                     
to immediately pro-rationing benefits. One of his legal                                                                         
concerns was the arbitration of that approach.  "What are                                                                       
the limits on reasonable agency activities, then? What are                                                                      
we to do in making those decisions when we have an absolute                                                                     
command like this, which tells us we have to pro-ration?                                                                        
But yet we have a wink and a nod from finance committee                                                                         
members. Can we act on those kinds of assurances legally                                                                        
and validly and withhold benefits or are we required under                                                                      
the law to go forward and pay full benefits?"                                                                                   
                                                                                                                                
He warned of class action litigation brought on behalf of                                                                       
the beneficiaries testing the legality of the broad                                                                             
application.                                                                                                                    
                                                                                                                                
Other unanswered questions were "what was a benefit                                                                             
program?" When referring to an individual, did that mean                                                                        
organizations that represented individuals or only benefit                                                                      
programs to individuals? Also, what was an insignificant                                                                        
appropriation? Expensive class action litigation was in                                                                         
store for the state if more definitive terms were not                                                                           
adopted.                                                                                                                        
                                                                                                                                
Senator Al Adams wanted to know if state statute had a                                                                          
definition of "benefit".  Jim Baldwin said there was one in                                                                     
the PDS program but was unaware on any that could be                                                                            
applied to Title 1.  Senator Al Adams asked the witness to                                                                      
state for the record the benefit program was for an                                                                             
individual or an organization. Jim Baldwin only knew how                                                                        
the bill was explained in the House Finance Committee. He                                                                       
thought those terms could be read to include organizations                                                                      
based on the federal precedent.                                                                                                 
                                                                                                                                
As Senator Sean Parnell read the benefit programs                                                                               
provision, it was clearly defined.  He didn't think it was                                                                      
vague.                                                                                                                          
                                                                                                                                
Jim Baldwin responded that he didn't think that this area                                                                       
was the only area of statutory construction that would be                                                                       
applied to this. When the intent was to impliably amend                                                                         
many statutory programs the courts would try to construe                                                                        
the two statutory schemes together and harmonize them if                                                                        
possible. If not, the area with necessary aide going to                                                                         
individuals for necessities, strict construction may not be                                                                     
applied by a court. He didn't believe it was clear.                                                                             
                                                                                                                                
ALISON ELGEE, Deputy Commissioner, Department of                                                                                
Administration testified against the bill and the                                                                               
implications it would have to the Longevity Bonus Program.                                                                      
She stated there were a number of seniors who were                                                                              
dependent on the payments. She told of the methods that the                                                                     
department applied to determine funding needs using a                                                                           
computer model.  However, there was no way to ensure the                                                                        
exact amount needed. If the department had begun to pro-                                                                        
rate payments based on the first model generated in                                                                             
September, benefits would have been withheld unnecessarily.                                                                     
There was nothing in the legislation to give the department                                                                     
direction on how to deal with a circumstance like that.                                                                         
                                                                                                                                
In projecting the program for the fiscal year 2000, a low-                                                                      
case scenario anticipated the amount appropriated by the                                                                        
Legislature would be short by approximately $2.4 million.                                                                       
Under those circumstances, the department saw no other                                                                          
option but to prorate the payments beginning on the                                                                             
effective date of this legislation if it passed. Based on                                                                       
committee testimony from the House Finance Committee, that                                                                      
was not their desire.                                                                                                           
                                                                                                                                
The department supported the income cap legislation and                                                                         
felt that was a better way to reduce the program.                                                                               
                                                                                                                                
BOB BRIGGS, Staff Attorney, Disability Law Center of                                                                            
Alaska, testified. He asked the committee to not pass the                                                                       
legislation.                                                                                                                    
                                                                                                                                
                                                                                                                                
Tape: SFC - 99 #110, Side B    9:53 AM                                                                                          
                                                                                                                                
                                                                                                                                
He spoke of the current funding options.  This legislation                                                                      
would eliminate one of them.  He felt that was bad policy.                                                                      
                                                                                                                                
He quoted Harry S. Truman.  The federal government provided                                                                     
support that was inadequate to meet the needs of those                                                                          
living in Alaska.  The Legislature had decided to provide                                                                       
the remaining funds to supplement the federal poverty                                                                           
level.                                                                                                                          
                                                                                                                                
He suggested changing the formula or the level of support.                                                                      
                                                                                                                                
He had concerns with the legal problems in the bill. He                                                                         
disagreed with Senator Sean Parnell's assessment on the                                                                         
clarity of the language. He detailed his interpretation.                                                                        
                                                                                                                                
Alaskan's with disabilities were not faceless.  He told of                                                                      
a logger in Coffman Cove who had been denied social                                                                             
security benefits.  His injuries were work related.                                                                             
                                                                                                                                
He wanted the Legislature to balance the budget but felt                                                                        
this bill was the wrong approach.                                                                                               
                                                                                                                                
TIM WEISS, Program Director and Past President, Parent's                                                                        
Incorporated, the statewide organization of parents of                                                                          
children with disabilities, testified in opposition to the                                                                      
bill. He told of his son's multiple disabilities.                                                                               
                                                                                                                                
BARRY BURNETT testified on behalf of his family in                                                                              
opposition to cuts to disability payments. In his opinion,                                                                      
there should be not cuts whatsoever to these benefits. He                                                                       
spoke about the difficulties of families where a spouse                                                                         
receives a paycheck and the benefits are eliminated. He                                                                         
didn't want to ask for a handout, but felt that the state                                                                       
should provide job training instead of cutting benefits.                                                                        
                                                                                                                                
Senator Sean Parnell asked if the witness was under the                                                                         
impression that this bill or the current budget reduced                                                                         
benefits to the disabled.  Barry Burnett responded that any                                                                     
legislation passed that cut any funding from the Department                                                                     
of Health and Social Services resulted in cuts to the                                                                           
disabled. Senator Sean Parnell made further comments about                                                                      
the budget this year that increased funding for the                                                                             
disabled.                                                                                                                       
                                                                                                                                
[Audio Interruption]                                                                                                            
                                                                                                                                
MANYA KONGOWYIE (last name spelling not provided),                                                                              
Developmental Disability Specialist since 1987, testified.                                                                      
She told the committee of her past work history in the                                                                          
social services field. She was the mother of a child who                                                                        
had multiple disabilities and had multiple disabilities                                                                         
herself.  She spoke of her reliance on the programs at                                                                          
different times in her life.  She was afraid this bill                                                                          
skewed the priorities. She said the recent Legislators' per                                                                     
diem increase equaled the amount of monthly payments to                                                                         
many program participants.                                                                                                      
                                                                                                                                
KEN DANE (last name spelling not provided), Independent                                                                         
Living Specialist, testified. He felt this created a type                                                                       
of cast system. He said this bill would not provide any                                                                         
happiness for those living on less than $1100 a month. He                                                                       
thought this bill could affect the veteran's preference                                                                         
programs. He had problems with denial of benefits to                                                                            
disabled veterans who were injured in service to their                                                                          
country.                                                                                                                        
                                                                                                                                
HEATHER FLYNN, UAA Adult Learning Center, testified via                                                                         
teleconference from Anchorage. She had concerns with the                                                                        
welfare reform efforts. She congratulated the Legislature                                                                       
for the success of the programs.  However, the child care                                                                       
programs were essential for the continued success of                                                                            
maintaining welfare recipients in the workforce.                                                                                
                                                                                                                                
JAN MCGILLIVARY, Chief Executive Officer, Alaska Mental                                                                         
Health Association, and Coordinator, Building Bridges                                                                           
Campaign for Mental Health, testified via teleconference                                                                        
from Anchorage in opposition to the bill.                                                                                       
                                                                                                                                
Co-Chair John Torgerson announced that written testimony                                                                        
was welcome and would be distributed to members.                                                                                
                                                                                                                                
GENE GRASTO, representing himself, testified via                                                                                
teleconference from Fairbanks. He felt it was demeaning for                                                                     
disabled Alaskans to have to plead and beg for no benefit                                                                       
reductions. He noted these people were not corporate                                                                            
executives.                                                                                                                     
                                                                                                                                
JEANETTE GRASTO, President, National Alliance for the                                                                           
Mentally Ill - Alaska, testified via teleconference from                                                                        
Fairbanks in opposition to the bill.  She was ashamed the                                                                       
bill was even before the Legislature.  She spoke to the                                                                         
need of many individuals. She noted that many mentally ill                                                                      
could participate in the work force if they were given                                                                          
opportunities.  She compared this to a family in need                                                                           
deciding to feed the baby and the grandmother less to make                                                                      
up the shortfall.                                                                                                               
                                                                                                                                
EDWARD MARTIN, SR., testified via teleconference from                                                                           
Kenai. He was against the bill. He spoke about collecting                                                                       
signatures for the dividend program, which gave him an                                                                          
opportunity to speak to many about this bill.  Most of the                                                                      
feedback he received told him Alaskan's did not want the                                                                        
budget balanced in this manner.                                                                                                 
                                                                                                                                
WINI CROSBY testified via teleconference from Kenai about                                                                       
her concerns with the bill.  The bill was too vague.  She                                                                       
talked about the need to move children from foster homes                                                                        
into adopted families. She recommended the bill be returned                                                                     
to the Senate Health and Social Services Committee for                                                                          
further review.                                                                                                                 
                                                                                                                                
JO RENK, Foster Mother and Adoptive Mother, testified via                                                                       
teleconference from Mat-Su. She opposed the bill, as it                                                                         
would adversely impact foster children.                                                                                         
                                                                                                                                
JOHN CANNON, Member, Key Coalition, and Lifequest,                                                                              
testified via teleconference from Mat-Su.  He felt the bill                                                                     
was unfair and threatened the lives of Alaskan's with                                                                           
disabilities.                                                                                                                   
                                                                                                                                
MOIRA MCBRIDE, Occupational Therapist, testified via                                                                            
teleconference from Sitka. She said the bill was not well                                                                       
conceived.                                                                                                                      
                                                                                                                                
CHERYL HALL, Alaska Independent Living, testified in person                                                                     
to the need of the Longevity Bonus Program. She asked that                                                                      
the committee not pass this bill.                                                                                               
                                                                                                                                
WALTER MAJOURIS, Executive Director, Mental Health Board                                                                        
testified in person.  He told about his organization. He                                                                        
was concerned that this bill would threaten the basic life                                                                      
needs of many mentally ill.  He spoke of programs that                                                                          
would be affected. He appreciated past efforts by the                                                                           
Legislature to support programs for disabled and mentally                                                                       
ill.  However, he felt this legislation would be a setback                                                                      
to the many advances.                                                                                                           
                                                                                                                                
JEFF JESSEE, Executive Director, Alaska Mental Health Trust                                                                     
Authority testified against the bill.  He referred to                                                                           
comments made by the House Finance Committee that this was                                                                      
only one of many attempts to reduce the budget. He spoke of                                                                     
the difficulties in determining the funding levels needed                                                                       
each year and compared it to predictions of annual snowfall                                                                     
amounts. He detailed the methods used to predict the needs                                                                      
of these programs.  He suggested the committee look at each                                                                     
program individually and to address cost-overruns                                                                               
specifically.  The alliance would assist in that process.                                                                       
                                                                                                                                
Fundamentally the point was who would face the risk. It                                                                         
would not be the Legislature; it would be the                                                                                   
beneficiaries.                                                                                                                  
                                                                                                                                
GAIL IGO, President, Anchorage Foster Care Association and                                                                      
Member, Statewide Foster Care Association, testified via                                                                        
teleconference from Anchorage. She spoke against the bill.                                                                      
She had spoken to many foster families and learned that                                                                         
many would be unable to continue to provide foster care if                                                                      
the benefit amounts were cut.                                                                                                   
                                                                                                                                
ERNEST DUMMANN, Parent of a child with a disability,                                                                            
testified via teleconference from Anchorage. He said it was                                                                     
a misperception that this bill would not affect programs.                                                                       
                                                                                                                                
                                                                                                                                
Tape: SFC - 99 #111, Side A   10:40 AM                                                                                          
                                                                                                                                
                                                                                                                                
He also commented on behalf on the Key Coalition.                                                                               
                                                                                                                                
MONTA LANE, Alaska Caregivers, testified via teleconference                                                                     
from Fairbanks. He disagreed with the statement that too                                                                        
many people were pulled into the system.  He also disagreed                                                                     
that the benefit levels were too high.  The Legislature had                                                                     
already imposed a cap.                                                                                                          
                                                                                                                                
He warned that the programs needed to be addressed                                                                              
individually and not left to future legislatures and                                                                            
commissioners to repair.                                                                                                        
                                                                                                                                
HOLLI KRISTIANSEN testified via teleconference from Kenai                                                                       
in opposition to the bill. She felt this was a dangerous                                                                        
bill that worked against everything the state had done to                                                                       
help children.  She believed this would only broaden the                                                                        
gap between the "haves" and the "have-nots".                                                                                    
                                                                                                                                
LEIGH HAGSTROM-SANGER, Frontier Community Services,                                                                             
testified via teleconference from Kenai. She told of a                                                                          
demonstration planned at the Kenai LIO to show opposition                                                                       
to the bill.                                                                                                                    
                                                                                                                                
SANDRA ADAMS, Representing her children and all of                                                                              
Alaskan's needy, testified via teleconference from Mat-Su.                                                                      
She spoke of the disabilities of her children and wondered                                                                      
about the level of support if this bill passed. She asked                                                                       
the members' to search their souls to find a solution.                                                                          
                                                                                                                                
Co-Chair John Torgerson announced that time did not allow                                                                       
for further public testimony. He ordered the bill held in                                                                       
committee.                                                                                                                      
                                                                                                                                
                                                                                                                                
SB 4 was added to the next meeting's agenda.                                                                                    
                                                                                                                                
ADJOURNED                                                                                                                       
                                                                                                                                
Senator Torgerson adjourned the meeting at 10:49AM.                                                                             
SFC-99 (3) 4/26/99                                                                                                              

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