Legislature(2001 - 2002)
05/17/2002 05:01 PM Senate FIN
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* first hearing in first committee of referral
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+ teleconferenced
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MINUTES
SENATE FINANCE COMMITTEE
SECOND SPECIAL SESSION
May 17, 2002
5:01 PM
TAPES
SFC-02 2nd SS #1, Side A
CALL TO ORDER
Co-Chair Kelly convened the meeting at approximately 5:01 PM.
PRESENT
Senator Dave Donley, Co-Chair
Senator Pete Kelly, Co-Chair
Senator Jerry Ward, Vice Chair
Senator Lyda Green
Senator Alan Austerman
Senator Lyman Hoffman
Senator Donald Olson
Also Attending: SENATOR GENE THERRIAULT; JIM DUNCAN, Commissioner,
Department of Administration
Attending via Teleconference: There were no teleconference
participants.
SUMMARY INFORMATION
SB 2006-APPROP: CAPITAL PROJECTS
The Committee adopted a committee substitute and moved the bill
from Committee.
SB 2007-APPROP: CONST. CBR
The bill moved from Committee.
SB2001-PIONEERS' AND VETERANS' HOME/ADVISORY BD
The Committee heard from Senator Therriault and the Department of
Administration. The bill moved from Committee.
Co-Chair Kelly announced that the following two pieces of
legislation individually address the FY 03 Capital Budget and the
provision to withdraw funds from the Constitutional Budget Reserve
(CBR) fund, neither of which passed the House of Representatives
during the regular legislative session.
AT EASE 5:03 PM / 5:04 PM
SENATE BILL NO. 2007
"An Act making an appropriation to reverse the effect of art.
IX, sec. 17(d), Constitution of the State of Alaska; making an
appropriation to balance revenue and general fund
appropriations; making an appropriation to the Department of
Revenue for management of the constitutional budget reserve
fund; making appropriations under art. IX, sec. 17(c),
Constitution of the State of Alaska, from the constitutional
budget reserve fund; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Donley commented this legislation is the mechanism by
which the State would access the CBR fund and that passage requires
a vote of three-quarters of the members of both the Senate and the
House of Representatives. He stated that the need for these funds
is dependant upon whether revenue is sufficient to fund the
activities of state government in the upcoming fiscal year. He
remarked that current estimates indicate CBR funds would be needed.
Senator Leman furthered that, although small compared to the
proposed total withdrawal from the fund, the $125,000 CBR
withdrawal for the Department of Revenue, Division of Treasury, as
contained in this bill, is part of the efforts of the Senate
Majority to meet spending limitations.
Senator Ward offered a motion to move SB 2007 from Committee with
individual recommendations.
Without objection SB 2007 MOVED from Committee.
AT EASE 5:07 PM / 5:27 PM
SENATE BILL NO. 2006
"An Act making and amending appropriations and
reappropriations; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Kelly explained the intent to adopt the language of SB
247, the FY 03 Capital budget as passed by the Senate, with the
exception of the CBR fund access provisions.
Senator Ward moved to adopt an unnumbered bill, work order number
22-LS1818\A, as a working draft committee substitute to SB 2006.
Co-Chair Donley objected.
Co-Chair Donley restated earlier concerns that Anchorage wastewater
and water quality projects "traditionally have been seriously
under-funded". He compared the amount of funds appropriated for
Cordova and Juneau as higher than that appropriated for Anchorage.
He remarked that a more equitable statewide distribution system
must be developed in the future for funding such projects.
Co-Chair Donley removed his objection to adoption of the committee
substitute as a working draft and it was ADOPTED without objection.
Senator Ward offered a motion to move from Committee CS SB 2006
(FIN) "as amended, Version A," with individual recommendations.
There was no objection and CS SB 2006 (FIN) MOVED from Committee.
AT EASE 5:29 PM / 5:32 PM
SENATE BILL NO. 2001
"An Act changing the name of the Alaska Pioneers' Home to the
Alaska Pioneers' and Veterans' Home and of the Alaska
Pioneers' Homes Advisory Board to the Alaska Pioneers' and
Veterans' Home Advisory Board; relating to housing and
services for veterans; relating to the advisory board for the
home; making other amendments to the statutes relating to the
home; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Kelly pointed out this is similar to legislation passed by
the Senate during the regular legislative session but not adopted
by the House of Representatives.
SENATOR GENE THERRIAULT detailed the differences between the
version originally introduced by Governor Tony Knowles and that
adopted by the Senate Rules Committee and passed by the Senate. He
stated the Senate Rules committee substitute and SB 2006 specify a
limit of 30 percent of beds in each Pioneers' Home that could be
dedicated to veterans. He noted the Administration had proposed
instating this limit in regulation rather than statute.
Senator Therriault listed the second change from the Governor's
original version specifies that this legislation only takes effect
if an agreement is reached with the US Veterans' Administration
(VA). He explained this provides that veterans' federal per diem
payments are paid to the veterans, and the veterans would then use
those funds to pay the State for services provided to them in the
Pioneers' Homes. He clarified the per diem payments are different
than VA benefits, which include prescriptions and other coverage.
He informed that if the per diem payments were made directly to the
Homes, the federal government could impose regulations on the
Homes. He read language from Section 24 of SB 2001, CONTINGENT
EFFECTIVENESS, specifying that the receipt of the per diem payments
from resident veterans, are accepted, "without any need for changes
in the state ownership and authority to operate and manage the home
under the state laws as they would exist after being amended by
this Act." He emphasized the intent that this legislation would not
"trigger" any changes to the manner in which the State owns and
operates the Pioneers' Homes.
Senator Hoffman asked if the Department of Administration fiscal
note, dated 5/17/02, reflects the aforementioned changes.
Senator Therriault replied the fiscal note "operates separately
from this bill" and explained that the fiscal note addresses the
cost of opening additional beds. He noted there are currently 90-95
veterans residing in the Pioneer's Homes, and this legislation
would allow receipt of these patients' VA per diem payments, at no
cost to the State. He stated that additional beds could be opened
under this legislation for new veteran residents as well, if funds
were appropriated.
Senator Therriault qualified this legislation contains a provision
in Section 21 relating to a study, which would entail additional
expense.
Co-Chair Kelly asked for further explanation of the consequences of
the VA per diem payments made directly to the State, versus the
payments made to veteran residents and forwarded to the State.
Senator Therriault responded there is some concern that if money is
directly appropriated to the Homes, there are "all kinds of strings
attached", in the form of VA regulations that would dictate how the
State must operate the Homes. On the contrary, he explained if
funds are appropriated to the veteran and used by the veteran to
pay the out-of-pocket cost of residency in the Home, the VA
regulations would not apply.
Senator Hoffman asked if once agreement is reached with the VA
whether the fiscal note would become invalid.
Senator Therriault responded the matter is dependent upon whether
the Committee chose to appropriate State funds to open additional
beds at the Homes.
Senator Hoffman restated his impression of negotiations that
determined that this bill would not be enacted until there was an
understanding by Alaska's Congressional delegation related to
funding. He asked how this agreement would impact the fiscal note.
JIM DUNCAN, Commissioner, Department of Administration, replied
that Section 24 stipulates that this legislation would only take
effect when the Alaska Department of Administration and the VA
reach agreement regarding the per diem payments and the ownership
and operation of the facilities by the State.
Mr. Duncan added that, under this legislation, the Department is
required to report to the Legislative Budget and Audit Committee
once such an agreement is reached.
Mr. Duncan informed that the negations are on-going and that the
goal is to reach an agreement as quickly as possible to allow
veterans to receive the benefits "they deserve" and are "entitled
to."
Senator Hoffman cited the fiscal note indicates the intent to fill
50 additional beds at a cost of $1.5 million. He again asked
whether the fiscal note must be changed if these beds could not be
filled until the agreement is reached.
Mr. Duncan replied the fiscal noted is based on the assumption
there would be an agreement and the legislation would take effect
by July 1, 2002. He stated it is uncertain whether an agreement
would be reached by that date and suggested the Committee could
consider an effective date of October 1, 2002, as he was certain
the beds would be open by that date. He stressed any fiscal note is
an estimate and this fiscal note estimates the beds would be open
by October 1.
Senator Leman asked for further explanation of the fiscal note. He
referenced the analysis indicates the funding would be used to open
50 beds for veterans, although there are currently 95 veterans who
are residents of the Pioneer Homes, and the intent is to designate
115 beds for veterans. He surmised that 35 veterans would reside in
the Homes in beds not designated for veterans.
Mr. Duncan replied there is currently no preference given for
veterans in the Pioneer Home system. He noted the language in SB
2001 states a preference could be assigned for up to 21 percent of
the total number of beds, but no more than 30 percent of the beds
in any one Home. He calculated 21 percent of the currently
available 500 beds, plus the proposed addition of 50 beds, in all
of the Homes to be 115 beds that could be designated with a
preference for veterans. Therefore, he said, the 95 current
veterans would reside in the designated beds and there would be
space available for up to an additional 20 veterans. He stressed
the additional 50 beds are necessary to provide the 20 veteran-
designated beds because of the 21-percent provision. He pointed out
more than 20 veterans could access the 50 additional beds depending
on their placement on the waiting list.
Senator Leman clarified the remaining 30 additional beds would be
available to those first on the waiting list regardless of whether
they are a veteran.
Mr. Duncan affirmed.
Senator Leman asked the assumption of "money flow" of the new
veteran residents.
Mr. Duncan replied the estimates are based on the assumption of 115
veteran residents. He qualified this could be an underestimation as
more veterans could be accepted into a Home.
Senator Leman next referred testimony given by the witness when
similar legislation was before the Committee during the regular
session. Senator Leman had assumed from this testimony that this
legislation could be enacted with fewer than 50 new beds made
available.
Mr. Duncan stated this fiscal note is "not inconsistent" with his
recollection of the earlier conversation. He noted the fiscal note
accompanying the original legislation was $2.6 million general
funds and $2.6 million Pioneer Home program receipts. He stated the
goal was to fill all 600 beds possible in the Pioneer Home system.
He informed that due to concerns about the level of State spending,
the Department submitted a fiscal note for SB 2001 to allow the
opening of 50 beds and to start the program. He stated this matter
is a policy call for the Committee to determine. He recommended the
Committee provide funding to open the maximum number of beds
possible.
Senator Leman asked the amount of time between when an agreement is
reached and when the residents are moved into the Homes. He asked
if there would be delay caused by current leases or other living
arrangements that must be addressed by the future residents.
Mr. Duncan surmised these factors would not cause delay because the
future residents have been listed on the waiting list for a period
of time and have already made necessary arrangements. However, he
pointed out additional staff must be hired, which could require
time. He assured that a portion of the beds would be opened as soon
as adequate staff is in place; with the remaining beds opened as
allowable.
Senator Leman calculated that the addition of 30 beds would provide
111 veteran preference designated beds statewide.
Mr. Duncan agreed.
Mr. Duncan next pointed out the fiscal note includes $250,000 for a
private contractor to conduct a study of the unmet needs of
veterans in Alaska under the age of 65, which he stressed is an
important element of the legislation.
Senator Ward moved SB 2001 from committee with individual
recommendations and the accompanying fiscal note.
There was no objection and SB 2001 MOVED from Committee with
accompanying $3 million fiscal note from the Department of
Administration.
RECESS TO CALL OF THE CHAIR 5:52 PM
ADJOURNMENT
Co-Chair Kelly adjourned the meeting at 05:57 PM.
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