Legislature(2003 - 2004)

05/10/2003 09:05 AM Senate FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                              MINUTES                                                                                         
                     SENATE FINANCE COMMITTEE                                                                                 
                           May 10, 2003                                                                                       
                              9:05 AM                                                                                         
                                                                                                                                
                                                                                                                                
TAPES                                                                                                                       
                                                                                                                                
SFC-03 # 86, Side  A                                                                                                            
SFC 03 # 86, Side  B                                                                                                            
SFC 03 # 87, Side  A                                                                                                            
                                                                                                                              
CALL TO ORDER                                                                                                               
                                                                                                                                
Co-Chair Gary Wilken convened the meeting at approximately 9:05 AM.                                                             
                                                                                                                                
PRESENT                                                                                                                     
                                                                                                                                
Senator Gary Wilken, Co-Chair                                                                                                   
Senator Lyda Green,  Co-Chair                                                                                                   
Senator Con Bunde,  Vice Chair                                                                                                  
Senator Robin Taylor                                                                                                            
Senator Ben Stevens                                                                                                             
Senator Lyman Hoffman                                                                                                           
Senator Donny Olson                                                                                                             
                                                                                                                                
Also  Attending:   SENATOR  GARY   STEVENS;  SENATOR  FRED   DYSON;                                                           
REPRESENTATIVE TOM ANDERSON; MIKE  BARTON, Commissioner, Department                                                             
of  Transportation  and Public  Facilities;  TOM WRIGHT,  Staff  to                                                             
Representative John Harris; JACQUELINE TUPOU, Staff to Senator Lyda                                                             
Green;  DOUGLAS   BRUCE,  Director,  Division  of   Public  Health,                                                             
Department  of Health  and Social  Services; WES  KELLER, Staff  to                                                             
Senator  Fred Dyson; ANNE  CARPENETI,  Assistant Attorney  General,                                                             
Legal  Services Section-Juneau,  Criminal  Division, Department  of                                                             
Law;   JUANITA   HENSLEY,   Special  Assistant,   Office   of   the                                                             
Commissioner, Department  of Public Safety; LINDA SYLVESTER,  Staff                                                             
to Representative  Bruce Weyhrauch; KATHLEEN STRASBAUGH,  Assistant                                                             
Attorney  General, Governmental  Affairs  Section, Civil  Division,                                                             
Department of Law                                                                                                               
                                                                                                                                
Attending  via   Teleconference:  From   Offnet  Sites:   DR.  JOHN                                                         
ROBERTSON, Medical  Director, Department  of Corrections;  DR. BETH                                                             
FUNK, Epidemiology  Section, Division of Public Health,  Department                                                             
of Health and Social  Services; CHRIS BEHEIM, Director,  Scientific                                                             
Crime Detection Laboratory and Manager, DNA Database, Department of                                                             
Public  Safety;  LINDA WILSON,  Deputy  Director,  Public  Defender                                                             
Agency, Department of Administration                                                                                            
                                                                                                                                
SUMMARY INFORMATION                                                                                                         
                                                                                                                                
SB 185-ROYALTY REDUCTION ON CERTAIN OIL                                                                                         
                                                                                                                                
This bill was scheduled but not heard.                                                                                          
                                                                                                                                
HB 229-PAROLE FOR MEDICAL/COGNITIVE DISABILITY                                                                                  
                                                                                                                                
The Committee  heard from  the bill's sponsors,  the Department  of                                                             
Corrections, and the Department  of Health and Social Services. One                                                             
amendment was presented  but withdrawn from consideration,  and the                                                             
bill was held in Committee.                                                                                                     
                                                                                                                                
HB 105-COMMERCIAL FISHING LOANS                                                                                                 
                                                                                                                                
The Committee  heard testimony  from the  sponsor and reported  the                                                             
bill from Committee.                                                                                                            
                                                                                                                                
SCR 10-CHARTER SCHOOL TASK FORCE                                                                                                
                                                                                                                                
The Committee heard from the sponsor, considered two amendments and                                                             
adopted one, and reported the bill from Committee.                                                                              
                                                                                                                                
HB 49-EXPAND DNA DATABASE                                                                                                       
                                                                                                                                
The Committee heard from the bill's sponsor, the Department of Law,                                                             
and  the  Department  of Public  Safety.  The  bill  reported  from                                                             
Committee.                                                                                                                      
                                                                                                                                
HB 109-TREASURY WARRANTS/LAPSED APPROPRIATIONS                                                                                  
                                                                                                                                
The Committee  heard from  the sponsor and  reported the bill  from                                                             
Committee.                                                                                                                      
                                                                                                                                
SB 213-KNIK ARM BRIDGE AND TOLL AUTHORITY                                                                                       
                                                                                                                                
The  Committee heard  from  the Department  of  Transportation  and                                                             
Public Facilities  and the Department of Law. The bill  was held in                                                             
Committee.                                                                                                                      
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 229(FIN)                                                                                             
     "An Act relating to special medical parole and to prisoners                                                                
     who are severely medically or cognitively disabled."                                                                       
                                                                                                                                
                                                                                                                                
This was  the first  hearing for  this bill  in the Senate  Finance                                                             
Committee.                                                                                                                      
                                                                                                                                
Co-chair  Wilken stated  that this  legislation  would provide  the                                                             
Alaska Board of Parole  the flexibility to deny or  approve medical                                                             
parole.                                                                                                                         
                                                                                                                                
TOM WRIGHT,  Staff to Representative  John Harris, Co-Chair  of the                                                             
House Finance  Committee,  stated that Senator  Lyda Green's  staff                                                             
would  present  testimony  on  the  behalf  of  the  House  Finance                                                             
Committee, the bill's sponsor.                                                                                                  
                                                                                                                                
JACQUELINE TUPOU, Staff to Senator  Lyda Green, commented that this                                                             
bill  would allow  the Parole  Board  to grant  parole to  severely                                                             
disabled or  ill prisoners.  As a testament  to the Parole  Board's                                                             
"proven track record" regarding discretionary parole decisions, she                                                             
informed that prisoners who are released on mandatory parole have a                                                             
77-percent recidivism rate as compared  to a one-percent recidivism                                                             
rate for those prisoners awarded discretionary parole by the Parole                                                             
Board.                                                                                                                          
                                                                                                                                
Ms. Tupou stated that the State's inmate population is comprised of                                                             
430 individuals 50 years of age or older and that 23 percent of the                                                             
430 are  more than 60 years  of age. She  expressed that  the aging                                                             
prison population is incurring  great medical expense to the State,                                                             
as  she informed  that  people in  State  custody are  exempt  from                                                             
Medicaid  or Medicare  programs  and  Veterans or  Native  American                                                             
benefits. Therefore,  she communicated that this legislation  would                                                             
enable the Department  to formulate a release plan  for qualifying,                                                             
critically ill  prisoners provided  that such things as  where they                                                             
would live  and who their  caregivers would  be are addressed.  She                                                             
assured  the Committee  that  the release  plan  must be  developed                                                             
before a prisoner's name would be advanced to the Parole Board.                                                                 
                                                                                                                                
Ms.  Tupou stated  that even  though  some of  these prisoners  are                                                             
currently in a hospital or other care facility, because they are in                                                             
State custody, the State is required  to post a guard with them 24-                                                             
hours a day, regardless  of the patient's physical  situation. Were                                                             
these prisoners granted a medical  parole, she stated that the cost                                                             
of the  individual's  care would  be provided  by federal  matching                                                             
monies or by family  resources. She reiterated that,  under current                                                             
conditions, these funding options are not available.                                                                            
                                                                                                                                
Ms.  Tupou declared  that,  were the  medical  parole option  being                                                             
considered, the prisoner's victim  would be notified and allowed to                                                             
comment. She further attested that were the action "to diminish the                                                             
seriousness of the crime," the medical parole would not be granted.                                                             
                                                                                                                                
Ms. Tupou reiterated  that this legislation would grant  the Parole                                                             
Board the flexibility to make these discretionary parole decisions.                                                             
                                                                                                                                
Senator Bunde  asked whether  a prisoner must  be diagnosed  with a                                                             
terminal  medical condition  before  being considered  for  medical                                                             
parole.                                                                                                                         
                                                                                                                                
Ms. Tupou replied yes, the prisoner  should be experiencing a life-                                                             
threatening illness from which recovery is not expected.                                                                        
                                                                                                                                
Senator Bunde asked whether the  illness must have "a time certain"                                                             
death element.                                                                                                                  
                                                                                                                                
DR. JOHN  ROBERTSON, Medical Director,  Department of  Corrections,                                                             
testified via  teleconference from  an offnet site to  explain that                                                             
the general guidelines  of this legislation specify  that "the vast                                                             
majority"  of people  who would  be considered  for medical  parole                                                             
status would have  three to six months to live "with  a year at the                                                             
outside."  He  expressed  that  this bill  addresses  the  lack  of                                                             
flexibility  the  Parole  Board  currently  experiences   regarding                                                             
medical paroles.                                                                                                                
                                                                                                                                
Senator Bunde voiced support for the bill.                                                                                      
                                                                                                                                
Dr. Robertson  commented  that safeguards,  based on other  states'                                                             
experiences,  are incorporated  into the  process,  and that he  is                                                             
confident that the Parole Board  would take all factors such as the                                                             
crime, the medical  condition, the prognosis, and the  release plan                                                             
into  consideration during  its  medical parole  determination.  He                                                             
stated that one of the prime considerations  in the release plan is                                                             
that an appropriate care environment  would be in available for the                                                             
person.                                                                                                                         
                                                                                                                                
Amendment #1: This amendment changes  the bill's title by inserting                                                             
new language  on page 1, line 2,  following the word "disabled"  to                                                             
read as follows.                                                                                                                
                                                                                                                                
     "An Act  relating to special  medical parole and  to prisoners                                                             
     who are severely  medically or cognitively disabled;  relating                                                             
     to a  severe acute respiratory  syndrome control program;  and                                                             
     providing for an effective date."                                                                                          
                                                                                                                                
Additionally,  two new sections are  inserted on page  1, following                                                             
line 3. The new sections read as follow.                                                                                        
                                                                                                                                
     Section 1. The uncodified law of the State of Alaska is                                                                    
     amended by adding a new section to read:                                                                                   
          PURPOSE. (a) The purposed of sec. 2 of this Act is to                                                                 
     clarify  the  law  and  expressly  establish  a  comprehensive                                                             
     program  for health  care decisions  to  control severe  acute                                                             
     respiratory   syndrome   (SARS)  in   this  state,   including                                                             
     reporting, examinations, orders,  and detention to protect the                                                             
     public health.                                                                                                             
          (b) The purpose  of secs. 3   7 of this Act is to clarify                                                             
     standards for special medical  parole and to address prisoners                                                             
     who are severely medically or cognitively disabled.                                                                        
          Sec.  2 AS 18.15  is amended by  adding a new section  to                                                             
     read:                                                                                                                      
          Article 1A. Severe Acute Respiratory Syndrome (SARS).                                                                 
          Sec. 18.15.112. SARS control program authorization. (a) A                                                             
     severe  acute respiratory syndrome  (SARS) control  program is                                                             
     authorized in  the department. The SARS control  program shall                                                             
     be administered  in the same  manner and has the  same powers,                                                             
     authority,  obligations, and  limited immunities  as does  the                                                             
     program for  the control of tuberculosis under  AS 18.15.120                                                               
     18.15.149, except for the following:                                                                                       
          (1) the provisions of the control program described in AS                                                             
     18.15.120(1) and (7);                                                                                                      
          (2) reports to state medical officers under AS 18.15.131;                                                             
          (3) examinations of persons under AS 18.15.133;                                                                       
          (4)  title  to and  inventory  of equipment  allotted  to                                                             
     private institutions under AS 18.15.140;                                                                                   
          (5) the screening of school employees under AS 18.15.145.                                                             
     (b)  In this  section,  "SARS"  or "severe  acute  respiratory                                                             
     syndrome" means the infectious  disease caused by the SARS-CoV                                                             
     or the SARS coronavirus and the mutations of that disease."                                                                
                                                                                                                                
Furthermore, a new bill section is inserted on page 4, line 12 that                                                             
reads as follows.                                                                                                               
                                                                                                                                
     Sec. 8. Sections  1 and 2 of this Act take effect  immediately                                                             
     under AS 01.10.070(c).                                                                                                     
                                                                                                                                
Senator Bunde moved for adoption of Amendment #1.                                                                               
                                                                                                                                
Co-Chair  Wilken objected to  discuss the  status of the  amendment                                                             
with Co-chair Green, the Chair of the Committee's subcommittees for                                                             
the Department of Health and Social  Services and the Department of                                                             
Corrections.                                                                                                                    
                                                                                                                                
Co-chair Green asked that the motion be temporarily tabled.                                                                     
                                                                                                                                
Co-Chair Wilken requested that the motion be withdrawn.                                                                         
                                                                                                                                
Senator Bunde WITHDREW the motion to adopt Amendment #2; however,                                                               
he asked that the amendment be discussed.                                                                                       
                                                                                                                                
DOUGLAS BRUCE, Director,  Division of Public Health,  Department of                                                             
Health and Social  Services stated that this amendment  would allow                                                             
the Department  to develop a program,  similar to its  tuberculosis                                                             
program, to address a possible outbreak of Sudden Acute Respiratory                                                             
Syndrome (SARS) or other issues  that might require quarantines. He                                                             
stated that the amendment would additionally provide the Department                                                             
with the  authority to address  the particulars  of the disease  as                                                             
they differ from those of tuberculosis.                                                                                         
                                                                                                                                
Co-Chair  Wilken  clarified  that  this amendment  would  affect  a                                                             
different section  of the bill than the medical parole  issue does,                                                             
and in addition, he stated, it would require a title change.                                                                    
                                                                                                                                
Senator  Hoffman asked  the potential  for a SARS  outbreak in  the                                                             
State.                                                                                                                          
                                                                                                                                
DR. BETH  FUNK, Epidemiology  Section, Division  of Public  Health,                                                             
Department   of  Health   and   Social  Services,   testified   via                                                             
teleconference from an offnet site  in Anchorage and specified that                                                             
this amendment would provide the  State with the ability to develop                                                             
a program  to specifically  address  the particulars  of SARS.  She                                                             
noted  that  the  State  has  observed  the  various  international                                                             
reactions  to SARS outbreaks  and has determined  that the  regions                                                             
that moved quickly to test and  quarantine suspected outbreaks have                                                             
been the most successful in disease  control. She stated that while                                                             
most  people  voluntarily  comply  with  quarantine  requests,  the                                                             
State's  lack  of  enforcement  capability   might  hinder  disease                                                             
control.                                                                                                                        
                                                                                                                                
Dr.  Funk  informed   that  the  incubation  period   for  SARS  is                                                             
approximately two to ten days. She stated that this timeframe could                                                             
provide the opportunity for SARS  to be introduced to the State due                                                             
to the  fact that  Alaskans travel  so much  and that national  and                                                             
international travel is so "rapid."                                                                                             
                                                                                                                                
Senator Taylor  questioned why one  specific infectious  illness is                                                             
addressed in  this amendment, as he  suggested that a  more generic                                                             
approach  should be presented  to allow  the Department to  address                                                             
infectious illnesses as deemed necessary.                                                                                       
                                                                                                                                
Dr.  Bruce agreed  "that  more general  powers"  would be  welcome;                                                             
however, he stated that this is the initial step of a long process.                                                             
                                                                                                                                
Senator Taylor voiced support for the overall Department objective.                                                             
However;  he stated that  previous legislative  attempts to  change                                                             
regulations  to address a medical  outbreak, specifically  acquired                                                             
immunodeficiency  syndrome  (AIDS),  were unsuccessful;  partly  he                                                             
noted,  due to a  lack of cooperation  from  the medical field.  He                                                             
avowed that he has "no problem  with this amendment," but he voiced                                                             
"strong concern ? with the inability of the Department to react" to                                                             
medical emergencies  because of  "political sensibilities,"  rather                                                             
than "the appropriate medical response."                                                                                        
                                                                                                                                
Co-Chair Green questioned  whether this concern could  be addressed                                                             
in current Public  Health regulations, as specified  on page 267 of                                                             
the Alaska Statutes, Year 2002, Volume 5, that read as follow.                                                                  
                                                                                                                                
     Section 18.05.040 Regulations (a) The commissioner shall adopt                                                             
     regulations   consistent  with   existing  law  for   (1)  the                                                             
     definition,  reporting,  and  control  of diseases  of  public                                                             
     health significance" should  provide the Commissioner with the                                                             
     authority to address major health issues.                                                                                  
                                                                                                                                
Mr. Bruce responded  that this amendment would address  the concern                                                             
that  this  regulation   does  not  provide  the  Department   with                                                             
sufficient ability to quarantine individuals.                                                                                   
                                                                                                                                
Co-chair  Green suggested  that the  language could  be amended  to                                                             
include SARS under the tuberculosis program authority.                                                                          
                                                                                                                                
Mr. Bruce voiced  support for the establishment of  a separate SARS                                                             
program, similar to that specified for tuberculosis, as he stressed                                                             
that the program  must contain language and procedures  specific to                                                             
SARS.                                                                                                                           
                                                                                                                                
Mr. Bruce  asserted that  this amendment  would provide an  interim                                                             
approach  to providing  the more  generic authority  that would  be                                                             
required.                                                                                                                       
                                                                                                                                
Co-Chair Green asked whether existing  State statutes, specifically                                                             
Title 26.  Military Affairs and  Veterans. would provide  the State                                                             
with the authority to make decisions regarding State disasters such                                                             
as an epidemic situation.                                                                                                       
                                                                                                                                
Mr. Bruce commented that "the Department  of Law has indicated that                                                             
they  would  be much  more  comfortable"  were  this  clarification                                                             
provided.                                                                                                                       
                                                                                                                                
Co-Chair  Green  agreed  with Senator  Taylor's  comment  that  the                                                             
amendment's language should be  generic as opposed to being crafted                                                             
to address  one specific virus. She  stated that she would  revisit                                                             
the language of the  amendment to provide a more generic  approach.                                                             
                                                                                                                                
Co-chair  Wilken  commented that  the  amendment would  be  further                                                             
revised.                                                                                                                        
                                                                                                                                
The bill was HELD in Committee.                                                                                                 
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 105(FIN)                                                                                             
     "An Act relating to loans to satisfy past due federal tax                                                                  
     obligations of commercial fishermen and to the commercial                                                                  
     fishing loan program."                                                                                                     
                                                                                                                                
                                                                                                                                
This was  the first  hearing for  this bill  in the Senate  Finance                                                             
Committee.                                                                                                                      
                                                                                                                                
Co-chair  Wilken  announced  that  this   legislation  would  allow                                                             
commercial fisherman  to secure loans  to satisfy federal  Internal                                                             
Revenue Service (IRS) debt retirement.                                                                                          
                                                                                                                                
SENATOR  GARY STEVENS,  the  bill's  sponsor, expressed  that  this                                                             
legislation results  from the State's Salmon Task Force  efforts to                                                             
assist the  "in crisis" fishing industry.  He stated that  the bill                                                             
proposes changes to the Commercial Fishing Revolving Loan Fund that                                                             
is funded by its  participants and administered by  the Division of                                                             
Investments, Department  of Community and Economic  Development, by                                                             
reinstating  a  previous  loan  program   that  allowed  commercial                                                             
fishermen "to  access these funds  to satisfy past due  federal tax                                                             
obligations."                                                                                                                   
                                                                                                                                
Senator G. Stevens voiced that  the Salmon Task Force supports this                                                             
legislation  in  order  to protect  and  retain  in-state  resident                                                             
limited-entry salmon permits and continue providing jobs in regions                                                             
of the  State with limited  job opportunities.  He emphasized  that                                                             
these loans would be "secured" and have a maximum $40,000 limit. He                                                             
stated that in addition to loan requirements, applicants must prove                                                             
that they  are a current  resident of the  State, must have  been a                                                             
resident  for the  two previous  years;  must be  current on  their                                                             
federal tax  filings; and  must have a  payment agreement  with the                                                             
IRS.  He  stated  that  this  legislation  would  incur  a  $30,000                                                             
detriment in FY 04 and a detriment of $13,000 thereafter through FY                                                             
09.                                                                                                                             
                                                                                                                                
Senator G. Stevens noted that the removal of the word "promptly" in                                                             
Section  3, subsection  (b), line  31 on  page 4,  would allow  the                                                             
Department   flexibility  regarding   the  timeline  required   for                                                             
advertising the sale  of repossessed permits in order  to entertain                                                             
"quality offers." This language reads as follows.                                                                               
                                                                                                                                
     Sec. 3. AS 16.10.337(b) is amended to read:                                                                                
     (b) If  the commission  does not exercise  its right  of first                                                             
     refusal within 30 days after  it receives the offer, or if the                                                             
     permit  is  not  subject   to  a buy-back   program  under  AS                                                             
     16.43.290-16.43.330, the department shall [PROMPTLY] advertise                                                             
     and sell the permit.                                                                                                       
                                                                                                                                
     Next Text Underlined [DELETED TEXT BRACKETED]                                                                            
                                                                                                                                
Senator  Bunde   asked  whether   the  bill's  two-year   residency                                                             
requirement might incur a legal challenge.                                                                                      
                                                                                                                                
Senator G. Stevens  stated that the two-year residency  requirement                                                             
is not a new provision in the bill, and he stated that, to date, no                                                             
legal challenge has been introduced.  He clarified that in addition                                                             
to the  two-year  residency requirement,  the applicant  must  be a                                                             
current resident of the State.                                                                                                  
                                                                                                                                
Senator Taylor clarified  that federal law does not  allow for more                                                             
than a two-year residency requirement.                                                                                          
                                                                                                                                
Senator Taylor  offered a  motion to move  the bill from  Committee                                                             
with individual recommendations and attached fiscal note.                                                                       
                                                                                                                                
There being no objections, HB 105  was REPORTED from Committee with                                                             
previous  negative $30,000  fiscal note #1  from the Department  of                                                             
Community and Economic Development.                                                                                             
                                                                                                                                
                                                                                                                                
     CS FOR SENATE CONCURRENT RESOLUTION NO. 10(HES)                                                                            
     Establishing the Joint Legislative Charter School Task Force.                                                              
                                                                                                                                
                                                                                                                                
This was  the first  hearing for  this bill  in the Senate  Finance                                                             
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken explained  that this bill  would create an  eight-                                                             
member  charter  school  task  force   to  review  Alaska  statutes                                                             
pertaining to charter schools.                                                                                                  
                                                                                                                                
WES KELLER, Staff to the bill's  sponsor Senator Fred Dyson, voiced                                                             
that this resolution would establish a charter school task force to                                                             
review existing laws for compliance with such issues as the federal                                                             
No Child Left Behind Act of 2001 (NCLB) and present a report to the                                                             
Legislature. He  noted that, in addition,  the task force  would be                                                             
required "to propose alternative  governing of a school" were it to                                                             
fail to meet requirements.                                                                                                      
                                                                                                                                
Senator Taylor voiced support for  the bill as he agreed that it is                                                             
wise  to  review   charter  school  regulations  and   provide  the                                                             
Legislature with policy directives.                                                                                             
                                                                                                                                
Senator  Bunde asked whether  the omission  of language  specifying                                                             
whether  the Legislative  representation on  the review panel  task                                                             
force, as referenced on page two,  line 21, would be members of the                                                             
majority or minority party was intentional.                                                                                     
                                                                                                                                
Mr. Keller responded  that the intent would be to appoint  a member                                                             
of the majority  and a member of  the minority from each  house. He                                                             
noted  that the  Senate  President  and the  Speaker  of the  House                                                             
support this language.                                                                                                          
                                                                                                                                
Amendment #1: This  amendment inserts clarifying language  into the                                                             
resolution on  page two, lines 21  - 23,to specify that  a minority                                                             
and majority member from each house  would comprise the four-member                                                             
Legislative presentation.                                                                                                       
                                                                                                                                
Senator Bunde moved for adoption of Amendment #1.                                                                               
                                                                                                                                
Co-chair Wilken clarified that  the amendment would provide for the                                                             
inclusion of  a total of four members:  one member of  the majority                                                             
and one member of the minority parties in the Senate and one member                                                             
of the majority and one member of the minority parties in the House                                                             
of Representatives.                                                                                                             
                                                                                                                                
Senator   Taylor  understood   the  amendment   to  provide   equal                                                             
representation.                                                                                                                 
                                                                                                                                
Co-Chair Wilken  objected to the  amendment. He voiced  being "very                                                             
comfortable with having the President of the Senate and the Speaker                                                             
of the House appoint whomever, regardless of party."                                                                            
                                                                                                                                
Senator Bunde asserted that while the language might be appropriate                                                             
under  the current  leadership, this  situation  might differ  over                                                             
time; therefore, he supported the clarifying language.                                                                          
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR: Senator Bunde and Senator Hoffman                                                                                     
                                                                                                                                
OPPOSED: Senator B. Stevens. Senator Taylor, Co-chair Green and Co-                                                             
chair Wilken                                                                                                                    
                                                                                                                                
ABSENT: Senator Olson                                                                                                           
                                                                                                                                
The motion FAILED (2-4-1)                                                                                                       
Amendment #1 FAILED to be adopted.                                                                                              
                                                                                                                                
Co-Chair Green characterized the bill's accompanying $20,000 fiscal                                                             
notes as  "excessive," as  she declared  that existing staff  could                                                             
provide support  to the short-term  task force. She noted  that the                                                             
amount of the bill's fiscal notes  raised concern during the Senate                                                             
HES Committee discussions.                                                                                                      
                                                                                                                                
Co-Chair Wilken observed that a  school administrator, principal or                                                             
superintendent should be involved in the review process.                                                                        
                                                                                                                                
Amendment #2: This  amendment inserts language into  the resolution                                                             
on page 2, line 27 as follows.                                                                                                  
                                                                                                                                
               (5) that the ninth member of the body be a school                                                                
     administrator, superintendent, or principal."                                                                              
                                                                                                                                
Co-Chair Wilken moved for the adoption of Amendment #2.                                                                         
                                                                                                                                
Senator Taylor objected.                                                                                                        
                                                                                                                                
SENATOR  FRED  DYSON expressed  that  more  than five  groups  have                                                             
requested  representation on  the review panel.  He stated  that in                                                             
response to this,  the decision was made to address  the make-up of                                                             
the panel in a broad manner so  that the policy group could solicit                                                             
input from special interest groups such as bargaining units, school                                                             
administrators, and school financial  administrators. He noted that                                                             
the two groups  specified in the  bill have the authority  to enter                                                             
into agreements as opposed to other groups.                                                                                     
                                                                                                                                
Discussion ensued amongst Committee  members, during which Co-Chair                                                             
Green suggested that the language of the amendment specify that the                                                             
Governor  would be  the  appointing  authority for  these  persons;                                                             
Senator  Hoffman suggested  that  the amendment  language could  be                                                             
addressed as a component of Number (2) in that section; and Senator                                                             
Taylor  suggested that  the amendment  should  specify a  "retired"                                                             
principal, superintendent or administrator.                                                                                     
                                                                                                                                
Amendment-to-Amendment #2: This friendly amendment to the amendment                                                             
would read as follows:                                                                                                          
                                                                                                                                
               (2) two members, appointed by the Governor, one of                                                               
     which should be a principal, administrator or superintendent.                                                              
                                                                                                                                
Co-chair Wilken moved  for the adoption of the friendly  amendment-                                                             
to-Amendment #2.                                                                                                                
                                                                                                                                
Senator  Dyson noted  that the  Department of  Education and  Early                                                             
Development's  representative,  appointed  by the  Governor,  could                                                             
possess a school administrator's background.                                                                                    
                                                                                                                                
There being no objection, Amendment #2, as amended, was ADOPTED.                                                                
                                                                                                                                
Senator Taylor  moved to  report the resolution,  as amended,  from                                                             
Committee with individual  recommendations and accompanying  fiscal                                                             
notes.                                                                                                                          
                                                                                                                                
There  being  no objection,  CS  SCR  10 (FIN)  was  REPORTED  from                                                             
Committee with previous $10,000  fiscal note #1 from the Senate HES                                                             
Committee and  previous $10,000 fiscal  note #2 from Department  of                                                             
Education and Early Development.                                                                                                
                                                                                                                                
                                                                                                                                
     SENATE CS FOR CS FOR HOUSE BILL NO. 49(JUD)                                                                                
     "An Act relating to the deoxyribonucleic acid (DNA)                                                                        
     identification registration system and testing; and providing                                                              
     for an effective date."                                                                                                    
                                                                                                                                
                                                                                                                                
This was  the first  hearing for  this bill  in the Senate  Finance                                                             
Committee.                                                                                                                      
                                                                                                                                
Co-chair Wilken  informed that this  bill would expand  the State's                                                             
deoxyribonucleic  acid (DNA) database "registry to  include samples                                                             
from all persons who are convicted of a felony or a misdemeanor sex                                                             
offense."                                                                                                                       
                                                                                                                                
REPRESENTATIVE TOM ANDERSON, the bill's sponsor, explained that the                                                             
collection  of DNA  "is the  next step  in the  advancement in  the                                                             
science  of crime  investigation,"  and  has been  instrumental  in                                                             
providing  evidence in  convictions  that, otherwise,  "would  have                                                             
previously  been  impossible."  He  stated that  DNA  evidence,  in                                                             
addition to  assisting in convictions,  has also aided  in clearing                                                             
persons  wrongfully  accused  of  a  crime.  He  stated  that  this                                                             
legislation would provide law enforcement efficiencies, assist with                                                             
furthering unsolved  crimes, and  expand the State's DNA  database.                                                             
Furthermore, he noted that DNA samples would be acquired from those                                                             
juveniles adjudicated as a delinquent for felony or misdemeanor sex                                                             
offenses, would allow  for voluntary and anonymous  DNA donors, and                                                             
would require  that sex offenders  or child kidnappers  register as                                                             
such. He stated that DNA sampling is a nationwide trend.                                                                        
                                                                                                                                
Senator Bunde voiced support for the bill.                                                                                      
                                                                                                                                
                                                                                                                                
SFC 03 # 86, Side B 09:52 AM                                                                                                    
                                                                                                                                
Senator Bunde understood  that parents might voluntarily  desire to                                                             
have   their  children's   DNA   sampled   in  order   to   provide                                                             
identification  verification;   however,  he  asked  the  value  of                                                             
anonymous DNA donations.                                                                                                        
                                                                                                                                
ANNE CARPENETI, Assistant Attorney General, Legal Services Section-                                                             
Juneau,  Criminal  Division,  Department   of  Law  responded  that                                                             
anonymous DNA  donations could be  valuable in identifying  missing                                                             
person remains.                                                                                                                 
                                                                                                                                
Senator  Taylor  asked for  further  clarification  regarding  "the                                                             
scope" of  individuals who would be  affected by this  DNA sampling                                                             
legislation.                                                                                                                    
                                                                                                                                
Ms. Carpeneti stated that individuals  "convicted of felonies under                                                             
Title 11 and  Title 28, Chapter  35 felonies which is  felony drunk                                                             
driving,  felony  refusal  and  felony  leaving  the  scene  of  an                                                             
accident" would  be subject to  the legislation. Additionally,  she                                                             
noted it would affect  persons convicted of crimes  against persons                                                             
under AS 1141  that would include  "a few misdemeanor  sex offenses                                                             
and assaults."                                                                                                                  
                                                                                                                                
Senator Taylor asked how the legislation would affect juveniles.                                                                
                                                                                                                                
Ms. Carpeneti responded that it would affect "juveniles adjudicated                                                             
as delinquents" who are convicted for these offenses.                                                                           
                                                                                                                                
Senator Taylor asked the legislation's fiscal impact.                                                                           
                                                                                                                                
Co-chair  Wilken stated  that an  indeterminate  Department of  Law                                                             
fiscal note accompanies the bill.                                                                                               
                                                                                                                                
Senator Taylor asked whether federal  funding might be forthcoming.                                                             
                                                                                                                                
Ms. Carpeneti voiced  the understanding that federal  funding would                                                             
be available to provide for the additional testing expenses.                                                                    
                                                                                                                                
JUANITA  HENSLEY, Special  Assistant, Office  of the  Commissioner,                                                             
Department  of Public Safety,  noted that  this federal funding  is                                                             
unique  in  that the  federal  government  would  establish  direct                                                             
contracts with certified laboratories to which the State would send                                                             
the samples  for testing. She noted  that this indirect  funding is                                                             
anticipated to be available for a minimum of five years.                                                                        
                                                                                                                                
Senator Hoffman asked  what provisions are included  in the bill to                                                             
guarantee that the DNA samples would not be used for other purposes                                                             
such  as health  information  or cloning.  Additionally,  he  asked                                                             
regarding the  State's liability  regarding the protection  of this                                                             
information.                                                                                                                    
                                                                                                                                
Representative Anderson responded that Section 11.56.762 located on                                                             
page 2, lines 20 - 26 of the bill addresses this concern.                                                                       
                                                                                                                                
     Sec.  11.56.762. Unlawful  use of  DNA samples.  (a) A  person                                                             
     commits the crime of unlawful use of DNA samples if the person                                                             
     knowingly, without authorization under AS 44.41.035, possesses                                                             
     or  allows another  person  access to  (1) a  blood, oral,  or                                                             
     tissue sample collected for  inclusion in the deozyribonucleic                                                             
     identification registration  system under AS 44.41.035, or (2)                                                             
     identification data or records derived from those samples.                                                                 
          (b) Unlawful use of DNA samples is a class C felony.                                                                  
                                                                                                                                
Ms. Carpeneti qualified that the DNA testing would be limited to 13                                                             
specific criteria  and would not include medical DNA  testing which                                                             
determines health history. She stressed that, while the State crime                                                             
laboratory would  retain the DNA sample in a secured  facility, the                                                             
legislation  prohibits   a  wider  range  of  testing   from  being                                                             
conducted.                                                                                                                      
                                                                                                                                
Senator Hoffman clarified  that the testing would be  limited to 13                                                             
elements.                                                                                                                       
                                                                                                                                
Ms. Carpeneti stated that the 13  DNA molecule-sampling tests would                                                             
provide sufficient information  to the Department of Public Safety.                                                             
She continued  that the sample would  be securely retained  in case                                                             
the DNA results require double-checking.                                                                                        
                                                                                                                                
Senator  Olson  asked  how  this  legislation  provides  protection                                                             
against DNA being used for commercial purposes.                                                                                 
                                                                                                                                
Representative  Anderson  stated  that protection  is  provided  in                                                             
language on  page 3, line 23 through  page 4, line 1 that  reads as                                                             
follows.                                                                                                                        
                                                                                                                                
     Sec. 7. AS 44.41.035(f) is amended to read:                                                                                
        (f) The DNA identification registration system is                                                                       
     confidential,  is not  a public  record under  AS 40.25.110                                                                
     40.25.140, and may be used only for                                                                                        
             (1) providing DNA or other blood grouping tests for                                                                
        identification analysis;                                                                                                
             (2) [LAW ENFORCEMENT PURPOSES INCLUDING] criminal                                                                  
        investigations; [AND] prosecutions, and identification of                                                             
        human remains;                                                                                                        
             (3) statistical blind analysis; [OR]                                                                               
             (4) improving the operation of the system; or                                                                    
             (5) exoneration of the innocent.                                                                                 
                                                                                                                                
        New text underlined [DELETED TEXT BRACKETED]                                                                          
                                                                                                                                
Representative  Anderson asserted  "that parameters" pertaining  to                                                             
sampling use are provided in the legislation.                                                                                   
                                                                                                                                
CHRIS BEHEIM, Director,  Scientific Crime Detection  Laboratory and                                                             
Manager, DNA  Database, Department  of Public Safety testified  via                                                             
teleconference from an offnet site to share that in the previous 16                                                             
months, the State's DNA database  entertained 30 searches resulting                                                             
in 15 instances  where the DNA  database "actually connected  crime                                                             
scene  evidence  to  convicted  offenders."   He  stated  that  the                                                             
remaining  15 "hits linked  together unsolved  crimes" whereby  law                                                             
enforcement officials have been notified that "the same perpetrator                                                             
committed these seemingly unrelated  offenses." He shared successes                                                             
that other  states have experienced  by the expansion of  their DNA                                                             
programs.                                                                                                                       
                                                                                                                                
Mr. Beheim  communicated that while  the current program  is "very,                                                             
very successful,"  an expanded  program would  be beneficial  as it                                                             
would provide identification  information for children;  incur cost                                                             
savings   by   reducing   the  time   involved   in   crime   scene                                                             
investigations;  update  evidence  information on  older,  unsolved                                                             
crimes;  and exonerate some  individuals considered  suspects  in a                                                             
crime. He  continued that  this legislation  would align the  State                                                             
with  other  states'  programs   by  allowing  DNA  samples  to  be                                                             
retroactively  acquired from individuals  who are in jail  or under                                                             
probation  or  parole. He  noted  that  current policy  limits  the                                                             
collection of  DNA sampling to those  convicted since the  bill was                                                             
initially enacted in 1996.                                                                                                      
                                                                                                                                
Mr.  Beheim informed  that the  state  of Virginia,  which has  the                                                             
largest criminal "DNA database in the country," has determined that                                                             
were their DNA database  limited to only violent offenders,  a high                                                             
percentage of crimes would not have been solved as "there is a very                                                             
strong  correlation between  individuals  who might  not have  been                                                             
convicted  of violent  crimes but  are still  involved in  criminal                                                             
activity." Therefore, he anticipated that the State of Alaska would                                                             
experience a similar increase in  its ability to match perpetrators                                                             
to crime  scenes. He continued  that this  program would allow  the                                                             
State's DNA  database to  be uploaded into  the National DNA  Index                                                             
System   (NDIS)   to   allow  unsolved   crime   profiles   to   be                                                             
reciprocatively  matched against other  states' convicted  offender                                                             
databases.                                                                                                                      
                                                                                                                                
Mr. Beheim assured  that the testing of the "DNA markers"  would be                                                             
limited  to  law   enforcement  identification  purposes,   and  he                                                             
furthered that, rather  than being identified by name,  DNA samples                                                             
are identified by a laboratory  coding system that is known only to                                                             
that particular crime laboratory.                                                                                               
                                                                                                                                
Senator Bunde  asked Mr.  Beheim to comment  on whether the  coding                                                             
system would  provide adequate  security measures against  computer                                                             
hackers  who might  seek access  to the  information  to sell,  for                                                             
instance, to an insurance company.                                                                                              
                                                                                                                                
Mr. Beheim  assured that the coding  system would prevent  a sample                                                             
from being  traced to  an individual.  Additionally, he  emphasized                                                             
that medical  testing information  would be  unavailable, as  those                                                             
types of tests would not be conducted.                                                                                          
                                                                                                                                
LINDA WILSON, Deputy  Director, Public Defender Agency,  Department                                                             
of Administration testified via  teleconference from an offnet site                                                             
to   express  that   the  adoption   of  this   legislation   would                                                             
"significantly  expand" the  offenses" upon  which DNA sampling  is                                                             
conducted. She expressed  that the 80 offenses that  would be added                                                             
to the qualifying list would range from misdemeanor convictions for                                                             
indecent exposure and assaultive behavior to felony convictions for                                                             
such non-violent  crimes as shoplifting and refusal  to submit to a                                                             
Breathalyzer test and failure to  stop at the direction of a police                                                             
officer. In addition,  she stated that the retroactive  language in                                                             
the bill is going "to widen" the number of individuals who would be                                                             
required to give a sample.                                                                                                      
                                                                                                                                
Ms  Wilson anticipated  that  the  department would  experience  an                                                             
increase in its caseload due to  being appointed to represent those                                                             
individuals  refusing  to  adhere  to  the  DNA  requirements.  She                                                             
continued that  this expected increase  in caseloads is  the reason                                                             
that the department has submitted an indeterminate fiscal note. She                                                             
criticized  that  the bill  does not  include  a mechanism  to  re-                                                             
evaluate  a  crime  wherein  a  convicted  person  maintains  their                                                             
innocence. She  asserted that a  mechanism to retest old  evidence,                                                             
which  was processed  using  less  sophisticated methods  than  are                                                             
available today, should be included in the bill.                                                                                
                                                                                                                                
Senator  Olson  asked  whether  the  Department  of  Administration                                                             
supported the legislation.                                                                                                      
                                                                                                                                
Ms. Wilson  announced that the department  was not in favor  of the                                                             
legislation.                                                                                                                    
                                                                                                                                
Senator  Bunde asked for  further information  regarding  testimony                                                             
citing  that individuals  who commit  "petty  crimes or  relatively                                                             
minor felony offenses" commit more serious offenses.                                                                            
                                                                                                                                
Ms. Hensley shared that when the state of Virginia expanded its DNA                                                             
sampling database  to include individuals  who were convicted  of a                                                             
"white collar crime" such as forgery,  the inclusion of these "non-                                                             
violent crime" offenders in the  DNA data base enabled the State to                                                             
solve 63-percent of its property  crimes, 21-percent of sex offense                                                             
crimes, 14-percent  of homicide crimes,  and one-percent  of murder                                                             
crimes. She  asserted that this  is evidence that individuals,  who                                                             
commit  non-violent crimes  such  as shoplifting,  do commit  other                                                             
crimes including violent crimes.                                                                                                
                                                                                                                                
Senator Stevens asked how this legislation would expand the State's                                                             
DNA qualifying  offenses as  specified in  the "State DNA  Database                                                             
Laws Qualifying Offenses (As of October 2002)" chart in the October                                                             
15,  2002   National  Conference   of  State  Legislatures   (NCSL)                                                             
LegisBrief  [copy on  file]. He  voiced the  understanding that  it                                                             
would provide for the inclusion of all felony offenses.                                                                         
                                                                                                                                
Ms. Carpeneti agreed that all felony offenses listed in the State's                                                             
Title 11  and Title 28.35 would  qualify, including Felony  Driving                                                             
While  Intoxicated  (DWI)  and  refusal  to submit  to  an  alcohol                                                             
Breathalyzer  test, as well  as "juveniles  found to be  delinquent                                                             
based on similar acts." Additionally, she stated, "it would include                                                             
some misdemeanors  that are  crimes against  a person;" as  well as                                                             
arrestees or  suspects "if there's  a search warrant to  gather DNA                                                             
from the suspect;" however, she  clarified that their DNA would not                                                             
be  included in  the databank  were they  cleared  of the  offense.                                                             
Continuing,  she  stated  that the  DNA  sampling  expansion  would                                                             
include  individuals  currently on  probation  or parole  were  the                                                             
crimes they committed offenses that are being added.                                                                            
                                                                                                                                
Senator Stevens assumed, therefore, that other states listed on the                                                             
chart might "have limited versions" of offenses as well.                                                                        
                                                                                                                                
Ms. Carpeneti concurred.                                                                                                        
                                                                                                                                
Ms. Carpeneti clarified that the bill would not include individuals                                                             
on unsupervised probation or parole.                                                                                            
                                                                                                                                
Senator B. Stevens assumed that  the four states that are using DNA                                                             
sampling  to  its "fullest  advantage"  require  DNA  samples  from                                                             
arrestees and suspects.                                                                                                         
                                                                                                                                
Ms.  Carpeneti  noted  that Louisiana  does  require  suspects  and                                                             
arrestees to give DNA samples.  However, she noted that it does not                                                             
require all violent crime offenders to provide DNA samples.                                                                     
                                                                                                                                
Senator  B. Stevens surmised  that because  Louisiana requires  DNA                                                             
samples from arrestees and suspects, there is no need to require it                                                             
from the violent crime offenders as they might have previously been                                                             
sampled.                                                                                                                        
                                                                                                                                
Ms. Carpeneti replied that in some  states, including Alaska, a DNA                                                             
sample taken  from an arrestee or  suspect who is not  convicted or                                                             
whose conviction  is overruled, would be purged from  the databank.                                                             
                                                                                                                                
Senator Stevens  stated that  because all  crime scene evidence  is                                                             
retained indefinitely, a convicted  offender's DNA could be matched                                                             
against  the entire  field.  Therefore, he  asserted  that all  the                                                             
various offense qualifications  could be eliminated,  were the bill                                                             
simplified to require "all jailed offenders" to be tested.                                                                      
                                                                                                                                
Ms.  Hensley  puzzled as  to  the  reason that  all  violent  crime                                                             
offenders are not tested in some states.                                                                                        
                                                                                                                                
Senator B  Stevens asserted that DNA  testing of all offenders  was                                                             
originally the intent of presenting this legislation.                                                                           
                                                                                                                                
Representative Anderson could not verify that assertion.                                                                        
                                                                                                                                
Senator  B.  Stevens  stated  that  he would  not  be  offering  an                                                             
amendment  to  this   affect  because  it  would  experience   much                                                             
opposition.  However, he  pointed out  that were  all offenders  to                                                             
provide DNA samples, they would either be exonerated of a crime and                                                             
their DNA sample would be destroyed  or they would be convicted and                                                             
would be a jailed offender.                                                                                                     
                                                                                                                                
Representative Anderson agreed; however, he voiced that there would                                                             
not be support for such a blanket approach.                                                                                     
                                                                                                                                
Senator Stevens asserted that an all-inclusive approach would solve                                                             
more crimes.                                                                                                                    
                                                                                                                                
Senator Taylor  voiced concern  regarding the  security of  the DNA                                                             
databanks and urged that safeguards be instituted to warrant a high                                                             
level of confidence.                                                                                                            
                                                                                                                                
Ms. Carpeneti responded  that the Department of Law  has confidence                                                             
that adequate  safeguards  would be  in place. She  noted that  the                                                             
inclusion of language specifying that anyone found guilty of misuse                                                             
of the sample and  the data would be charged with a  Class C felony                                                             
would be a deterrent.                                                                                                           
                                                                                                                                
Senator  Olson voiced  concern that  a DNA match  might reflect  "a                                                             
false positive" and therefore convict an innocent person.                                                                       
                                                                                                                                
Mr. Beheim responded  that DNA profiles are essentially  unique and                                                             
that  it would  be  virtually  impossible,  with the  exception  of                                                             
identical twins, for two individuals  to have the same DNA profile.                                                             
He alerted that a sample mix-up  could occur, however, he qualified                                                             
that  samples are  retained  and are  re-analysised  for  "positive                                                             
assurance" whenever a positive "hit" is found.                                                                                  
                                                                                                                                
Senator Olson  asked how often  a mix-up  in the collection  of the                                                             
data and a DNA sample might occur.                                                                                              
                                                                                                                                
Mr. Beheim responded that no mix-ups  were found in the re-analysis                                                             
conducted on  the 15 positive hits  that have been experienced.  He                                                             
continued  that in addition  to the re-testing  of the crime  scene                                                             
evidence, a  new DNA sample from  the suspect is also  acquired and                                                             
tested previous to any criminal proceedings being undertaken.                                                                   
                                                                                                                                
Senator Olson  asked what is done  with DNA samples of  an unsolved                                                             
crime.                                                                                                                          
                                                                                                                                
Mr. Beheim responded  that all crime scene evidence  is permanently                                                             
retained in the laboratory.  He stated that all unsolved  crime DNA                                                             
profiles, which  are referred to as  a forensic index,  are entered                                                             
into a national database  and "are searched against  other unsolved                                                             
cases" on a State and national level.                                                                                           
                                                                                                                                
AT EASE 10:26 AM / 10:26 AM                                                                                                     
                                                                                                                                
Senator  Taylor  moved  to report  the  bill  from  Committee  with                                                             
individual recommendations and accompanying fiscal notes.                                                                       
                                                                                                                                
Without objection, SCS HB 49(JUD)  was REPORTED from Committee with                                                             
previous zero fiscal note # 1 from the Department of Public Safety,                                                             
previous zero fiscal  note #2 from Department of Law;  and previous                                                             
indeterminate fiscal note #3 from the Department of Administration.                                                             
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 109(FIN)                                                                                             
     "An  Act  relating  to  the limitation  on  payment  of  state                                                             
     treasury warrants and to the  payment of a claim for which the                                                             
     appropriation  has  lapsed;  and providing  for  an  effective                                                             
     date."                                                                                                                     
                                                                                                                                
                                                                                                                                
LINDA SYLVESTER, Staff to Representative  Bruce Weyhrauch, informed                                                             
the  Committee  that  this bill  would  streamline  the  accounting                                                             
functions  for two items:  stale-dated  warrants and  Miscellaneous                                                             
Claims. She  stated that rather than  the current process  in which                                                             
the funds  designated for warrants  are transferred to  the general                                                             
fund if  they are  not cashed  within two years  of issuance,  this                                                             
legislation would designate that  the funds for warrants not cashed                                                             
within  six  months  of  issuance   would  be  transferred  to  the                                                             
Department of Revenue's "Unclaimed Property Section." She explained                                                             
that this action would allow delinquent  claims to be paid when the                                                             
warrants   are  submitted,   without  requiring   the   originating                                                             
department to request funds to  be re-appropriated from the general                                                             
fund via the Fast Track Supplemental bill.                                                                                      
                                                                                                                                
Senator Olson asked  whether there is any opposition  to this bill.                                                             
                                                                                                                                
Ms. Sylvester stated there is none.                                                                                             
                                                                                                                                
Senator  Taylor  moved  to report  the  bill  from  Committee  with                                                             
individual recommendations and accompanying fiscal note.                                                                        
                                                                                                                                
There  being no  objections,  CS HB  109  (FIN) was  REPORTED  from                                                             
Committee  with  zero  fiscal   note  #1  from  the  Department  of                                                             
Administration.                                                                                                                 
                                                                                                                                
                                                                                                                                
     SENATE BILL NO. 213                                                                                                        
     "An Act establishing the Knik Arm Bridge and Toll Authority                                                                
     and relating to that authority; and providing for an effective                                                             
     date."                                                                                                                     
                                                                                                                                
                                                                                                                                
This was  the first  hearing for  this bill  in the Senate  Finance                                                             
Committee.                                                                                                                      
                                                                                                                                
Co-chair Wilken stated that this  legislation would provide for the                                                             
establishment  of an independent authority  to build and  operate a                                                             
Knik Arm Bridge.                                                                                                                
                                                                                                                                
MIKE BARTON, Commissioner, Department  of Transportation and Public                                                             
Facilities, expressed that this bill would establish a separate and                                                             
independent authority, which would  function in a similar manner as                                                             
the Alaska  Housing  Finance Corporation,  to build  and operate  a                                                             
bridge  across Knik  Arm.  In addition,  he  stated  that it  would                                                             
provide for  the creation of a  three-person board, which  would be                                                             
comprised of the commissioners of the Department of Revenue and the                                                             
Department of  Transportation and  Public Facilities, and  a public                                                             
member appointed  by the Governor. He specified that  each of these                                                             
persons  would  serve  a  five-year  term with  the  option  of  an                                                             
additional five-year term.                                                                                                      
                                                                                                                                
Mr. Barton declared  that the majority of the language  in the bill                                                             
pertains to the Authority's ability to: issue revenue bonds; accept                                                             
and receive  federal government  funding;  provide for  Legislative                                                             
oversight of  bonds; and manage  the construction and  operation of                                                             
the bridge.                                                                                                                     
                                                                                                                                
Co-chair Wilken  announced that the  purpose of this hearing  is to                                                             
entertain issues regarding the bill.                                                                                            
                                                                                                                                
Senator  Olson  asked  whether a  change  in  administration  would                                                             
"automatically change" the Board's membership.                                                                                  
                                                                                                                                
Commissioner Barton  replied that even though the commissioners  of                                                             
the  two  departments   might  change  as  the  result   of  a  new                                                             
administration,  this situation  would not  immediately affect  the                                                             
members of the Board as they are appointed for five-year terms.                                                                 
                                                                                                                                
Senator  Olson  asked the  reactions  to  this legislation  by  the                                                             
affected communities, particularly the reaction of the Municipality                                                             
of Anchorage which would be most impacted by this legislation.                                                                  
                                                                                                                                
Commissioner Barton  responded that "there is an amazing  amount of                                                             
support"  for the construction  of a  bridge. He  stated that  at a                                                             
recent  meeting in  Palmer  in the  Matanuska-Susitna  Borough,  no                                                             
opposition to the bridge was experienced.                                                                                       
                                                                                                                                
Senator Taylor  noted that the distance  across Knik Arm  is short.                                                             
Therefore, he suggested that a fast ferry and/or a hovercraft might                                                             
be viable alternatives to a bridge.                                                                                             
                                                                                                                                
Commissioner Barton acknowledged the suggestion.                                                                                
                                                                                                                                
Senator Hoffman, referring to the three-person administrative staff                                                             
as  outlined  in  the  accompanying   May  5,  2003  Department  of                                                             
Transportation and Public Facilities  fiscal note, asked whether it                                                             
is   imperative  that   staff  be   hired   immediately  upon   the                                                             
establishment  of the  Authority.  Additionally, he  asked at  what                                                             
point  the  tolls  generated  from the  bridge  would  support  the                                                             
bridge's administrative costs.                                                                                                  
                                                                                                                                
Commissioner  Barton  voiced   the  need  for  early  hire  of  the                                                             
administrative staff, as they would be able to assist the Authority                                                             
in securing  adequate  funding and  design  determinations for  the                                                             
bridge. He noted that the construction of the bridge is anticipated                                                             
to occur in the 2007  to 2009 timeframe, depending  upon the bridge                                                             
design.                                                                                                                         
                                                                                                                                
Senator Hoffman asked when the bridge design requests for proposals                                                             
should be conducted  in order to start construction  in the 2007 to                                                             
2009 timeframe.                                                                                                                 
                                                                                                                                
Commissioner  Barton responded that  it would depend on  the bridge                                                             
option  selected.  He stated  that  bridge  design work  should  be                                                             
conducted in 2005 and 2006.                                                                                                     
                                                                                                                                
Senator Olson voiced  surprise that there is no opposition  to this                                                             
legislation as,  he stated, this is  not typically the norm  when a                                                             
project could negatively affect property values in an area.                                                                     
                                                                                                                                
Commissioner  Barton reiterated  that,  while there  might be  some                                                             
concern, no opposition has been expressed.                                                                                      
                                                                                                                                
Co-Chair Wilken  voiced concern  regarding the Department's  fiscal                                                             
note and the subsequent impact on the FY 04 budget.                                                                             
                                                                                                                                
Co-Chair   Wilken  opined   that  communities,   specifically   the                                                             
Municipality of Anchorage and the Mat-Su Borough, should be able to                                                             
participate in discussions with the Bridge Authority. Therefore, he                                                             
questioned  whether the word  "confer," as denoted  in the  bill in                                                             
Article 2.  Powers and Duties, Subsection  (a)(17) on page  4, line                                                             
27, is "strong enough."                                                                                                         
                                                                                                                                
               (17) confer with municipal and other governments,                                                                
     metropolitan planning organizations, and the department,                                                                   
     concerning the Knik Arm bridge;                                                                                            
                                                                                                                                
Commissioner   Barton  referred  the   Committee  to  language   in                                                             
Subsection  (b)(5), on  page 5,  line  18 that  specifies that  the                                                             
Authority must coordinate activities with these communities.                                                                    
                                                                                                                                
               (5) coordinate the exercise of its powers to plan,                                                               
     design, construct, operate, and maintain the Knik Arm Bridge                                                               
     with the department, and with the mayors of the Municipality                                                               
     of Anchorage and the Matanuska-Susitna Borough.                                                                            
                                                                                                                                
Co-Chair Wilken acknowledged this language; however, he opined that                                                             
the word "coordinate is a soft word."                                                                                           
                                                                                                                                
Co-Chair Green testified to the  Mat-Su Borough's long-term support                                                             
of  this  project.   She  responded  to  Senator  Olson's   remarks                                                             
pertaining to  the project's adverse  effect on Anchorage  property                                                             
values  by asserting  that the  Mat-Su Borough  would similarly  be                                                             
affected by a loss of traffic in  its core area. However, she noted                                                             
that  allowing  traffic  to  be  expedited  from  the  area  toward                                                             
Anchorage would  relieve congestion  and provide other  communities                                                             
more direct access to Anchorage.                                                                                                
                                                                                                                                
Co-chair  Green  voiced,  however,   that  the  Mat-Su  Borough  is                                                             
concerned  about the primacy  of the  Department. Furthermore,  she                                                             
noted  that  while  the Mat-Su  Borough  and  the  Municipality  of                                                             
Anchorage  might not  always agree  on an  issue, both  communities                                                             
support  improvements in  the regional  transportation system.  She                                                             
voiced support of Co-Chair Wilken's  concern about "soft language,"                                                             
and  she  expressed  further  concern  regarding  the  Department's                                                             
"higher level of control;" particularly the Department's control on                                                             
project funding.                                                                                                                
                                                                                                                                
                                                                                                                                
SFC 03 # 87, Side A 10:41 AM                                                                                                    
                                                                                                                                
                                                                                                                                
Commissioner Barton responded that this legislation would establish                                                             
"a separate  legal authority  that would be  able to raise  revenue                                                             
through the sale of bonds." He  assured that the bonds would not be                                                             
an obligation  of the  State, as  the Authority  would issue  them.                                                             
Furthermore, he noted  that it would be Authority,  rather than the                                                             
Department that would  be working with the various  municipalities                                                              
                                                                                                                                
Co-Chair Green asked how the situation  would be resolved, were the                                                             
two communities "to totally disagree" on the project.                                                                           
                                                                                                                                
Senator Taylor declared  that the Bridge Authority  must be created                                                             
as an autonomous  entity in order  to issue bonds. Furthermore,  he                                                             
voiced  that while  it  might be  desired for  the  public to  have                                                             
greater input and that the affected communities should consult with                                                             
the Authority regarding the project, he attested that the action of                                                             
providing communities with a "primacy" control could jeopardize the                                                             
asset  that the  bonds  are pledged  to  "payoff."  He voiced  that                                                             
stronger language  might negatively affect the Authority's  ability                                                             
to sell bonds.                                                                                                                  
                                                                                                                                
Co-Chair Wilken asked the Department  to address these concerns and                                                             
report back to the Committee. Additionally, he asked the Department                                                             
how a delay in action on this legislation might impact the project.                                                             
                                                                                                                                
Commissioner Barton responded that  even if no action were taken on                                                             
the bill this Legislative session, the Department would continue to                                                             
"proceed  on the course  we're on."  However, he  asserted that  it                                                             
would  be beneficial  to pass  the legislation  this  year, as  the                                                             
establishment  of the  Bridge Authority  would  assist in  focusing                                                             
efforts  and  developing  methods  to  secure  funding  that  would                                                             
contribute to getting the bridge built.                                                                                         
                                                                                                                                
Senator  B. Stevens  voiced concern  regarding "the  extent of  the                                                             
power of the authority" and how  it would affect the communities of                                                             
Anchorage  and the Mat-Su  Borough. To  that end,  he asked  for an                                                             
explanation of the  term "appurtenant facilities" as  referenced in                                                             
Article 2.  Powers and Duties.  Section 44.90.111 subsections  (1),                                                             
(7), and (16) on page three and four that read as follows.                                                                      
                                                                                                                                
     Article 2. Powers and Duties.                                                                                              
          Sec. 44.90.111. Powers and duties of the authority. (a)                                                               
     In furtherance of its purposes, the authority may                                                                          
              (1) own, acquire, construct, develop create,                                                                      
     reconstruct, equip, operate, maintain, extend, and improve the                                                             
     Knik Arm bridge and its appurtenant facilities;                                                                            
                                                                                                                                
              (7) issue bonds and otherwise incur indebtedness, in                                                              
     accordance with AS 44.90.211,  in order to pay the cost of the                                                             
     Knik Arm bridge and its appurtenant  facilities; the authority                                                             
     may also secure payment of  the bonds or other indebtedness as                                                             
     provided in AS 44.90.221;                                                                                                  
                                                                                                                                
              (16) exercise powers of eminent domain or file a                                                                  
     declaration of taking as necessary for the Knik Arm bridge and                                                             
     appurtenant facilities under AS 09.55.240  09.55.460 to                                                                    
     acquire land or an interest in land;                                                                                       
                                                                                                                                
Senator B.  Stevens opined that  this language seemingly  specifies                                                             
that the Authority  is the entity  that is responsible  "for paying                                                             
the cost of the bridge  and its associated facilities,"  as well as                                                             
"defining in terms of land and facilities," what is required by the                                                             
Authority in order to build the bridge. He surmised therefore, that                                                             
the Authority  would be responsible  for the bridge section  of the                                                             
transportation corridor  between the two municipalities,  and would                                                             
issue bonds  to enable the  bridge to be  built as well as  levying                                                             
fees to pay for those bonds.                                                                                                    
                                                                                                                                
Commissioner Barton stated that is correct.                                                                                     
                                                                                                                                
Senator  B  Stevens   voiced  that  the  mechanism   for  including                                                             
communities  in the events  leading up to  the construction  of the                                                             
bridge is provided; however, he questioned how communities would be                                                             
involved after the bridge is built.                                                                                             
                                                                                                                                
Commissioner  Barton concurred  that this  language "addresses  the                                                             
crossing  itself and its  immediate environs."  He stated  that the                                                             
federal highway  program would  be involved  because the north  and                                                             
south  side approaches  to the  bridge would  affect the  federally                                                             
funded  road network  to such  place  as Houston  and Talkeetna  in                                                             
addition to the Mat-Su  Borough and the Municipality  of Anchorage.                                                             
He reminded Committee Members that  the federally mandated Regional                                                             
Transportation  Planning Organization  is  charged with  addressing                                                             
conflicts that  a transportation project  such as this  one, "might                                                             
incur to a great part of the State."                                                                                            
                                                                                                                                
Senator  B. Stevens  asked whether  the Knik  Arm Bridge  Authority                                                             
"would be  a participant  in the Regional  Transportation  Planning                                                             
Organization."                                                                                                                  
                                                                                                                                
Commissioner Barton responded that  while the Authority "would have                                                             
a lot  of involvement" with  the Organization,  he is unsure  as to                                                             
whether the Authority would be a member of it.                                                                                  
                                                                                                                                
Senator B. Stevens interjected that boroughs, cities, and the State                                                             
are members of that organization.                                                                                               
                                                                                                                                
Commissioner Barton agreed.                                                                                                     
                                                                                                                                
Senator Bunde pointed out that this project would require the State                                                             
to expend  "$2.5 million  of scare  dollars" to  access the  "free"                                                             
federal  highway fund  money. Therefore,  he stated  that while  it                                                             
might be  nice to have  this bridge, he  deemed it "unnecessary  at                                                             
this time."                                                                                                                     
                                                                                                                                
Senator Hoffman stated that this legislation appears to provide the                                                             
Knik Arm Bridge Authority with  the power to operate outside of the                                                             
Executive Budget Act. He asked  the justification for providing the                                                             
Authority with this ability as opposed to the State providing funds                                                             
and  maintaining control  of  such things  as  the Municipality  of                                                             
Anchorage International Airport improvements.                                                                                   
                                                                                                                                
Commissioner  Barton responded that  the Executive Budget  Act does                                                             
not apply to the Authority's ability to issue revenue bonds.                                                                    
                                                                                                                                
KATHLEEN  STRASBAUGH,  Assistant  Attorney   General,  Governmental                                                             
Affairs Section, Civil Division,  Department of Law, clarified that                                                             
the Authority would be required to comply with the Executive Budget                                                             
Act with the exception  that the revenues generated  by the sale of                                                             
the bonds would be obligated to pay off those bonds. She noted that                                                             
this  provision  is  mirrored  after  the  Alaska  Housing  Finance                                                             
Corporation (AHFC) that operates in this manner and has the duty to                                                             
repay its bonds.                                                                                                                
                                                                                                                                
Ms. Strasbuagh noted,  however, that the money appropriated  by the                                                             
State for operating expenses does  not qualify for exemption, as is                                                             
specified  in  Article  2.  Powers  and  Duties.   Sec.  44.90.111.                                                             
Subsection (b)(2) that reads as follows.                                                                                        
                                                                                                                                
     (2) comply with the provisions of AS 37.07 (Executive Budget                                                               
     Act), except that AS 37.07 does not apply to the activities of                                                             
     the  authority that  relate  to the authority's  borrowing  of                                                             
     money as  provided in this  chapter, including the  issuing of                                                             
     its  obligations  or  evidence   of  that  borrowing  and  the                                                             
     repayment of the debt obligation;                                                                                          
                                                                                                                                
Commissioner Barton noted that this exemption might be unnecessary;                                                             
however,  he suggested that  a person with  bond experience  should                                                             
advise on the matter.                                                                                                           
                                                                                                                                
Senator Hoffman noted that AHFC has collateral comprised of housing                                                             
and other properties that are readily  marketable as opposed to the                                                             
Knik  Arm Bridge  Authority.  Therefore, he  stated  that were  the                                                             
Authority not granted this exemption, the State could be liable for                                                             
the repayment of the bond debt.                                                                                                 
                                                                                                                                
Commissioner Barton voiced that the intent of the legislation is to                                                             
separate the State  from the sale of revenue bonds  in order to not                                                             
obligate the State.  He noted that an insurance company  as opposed                                                             
to the State would  be responsible were the aforementioned  airport                                                             
bonds defaulted upon.                                                                                                           
                                                                                                                                
Co-Chair Wilken  opined that while  language in the bill  specifies                                                             
that  the  State  would  not  be  obligated  for  these  bonds,  he                                                             
questioned  what  is  referred  by the  phrase  "other  monies"  as                                                             
referenced in Sec. 44.90.241 Nonliability  on Bonds. Subsection (b)                                                             
on page nine, lines 20-23 that reads as follows.                                                                                
                                                                                                                                
          (b) The bonds issued by the authority do not constitute                                                               
     an  indebtedness  or other  liability  of the  state  or of  a                                                             
     political subdivision  of the state other than  the authority,                                                             
     but  shall be  payable solely  from the  income, receipts,  or                                                             
     other money or property of the authority.                                                                                  
                                                                                                                                
Co-chair  Wilken  further  inquired   regarding  language  in  Sec.                                                             
44.90.221. Trust indentures and trust agreements. that provides for                                                             
the  establishment  of a  capital  reserve  fund. He  worried  that                                                             
because the  State would be "recognizing  the bridge and  the debt"                                                             
that the  "other  monies" specified  might be  the State's  "saving                                                             
account," and that  in future years, the State might  be allocating                                                             
"money  to pay  that debt  and/or the  operation of  a bridge  that                                                             
people aren't using."                                                                                                           
                                                                                                                                
Commissioner Barton replied that, "it is not the intent to obligate                                                             
the State."                                                                                                                     
                                                                                                                                
Co-Chair  Wilken  asked  whether  there are  other  State  programs                                                             
modeled in this fashion.                                                                                                        
                                                                                                                                
Commissioner  Barton responded  that  such programs  would  include                                                             
AHFC,  the  Alaska  Industrial  Development  and  Export  Authority                                                             
(AIDEA), some portions of the Alaska  Railroad Corporation, and the                                                             
Alaska Aerospace Development Corporation.                                                                                       
                                                                                                                                
Co-Chair  Wilken asked  whether any  of the  State's  international                                                             
airports have a similar authority.                                                                                              
                                                                                                                                
Commissioner Barton responded no.                                                                                               
                                                                                                                                
Co-Chair Wilken asked whether the Authority could be terminated and                                                             
its responsibilities  assumed by  the Department of  Transportation                                                             
and Public Facilities  once its financial obligations  are retired,                                                             
as  specified  in  Sec.  44.90.021.  Establishment   of  authority.                                                             
Subsection  (b) on  page two,  lines four  and five  that reads  as                                                             
follows.                                                                                                                        
                                                                                                                                
          (b) The authority may not be terminated as long as it has                                                             
     bonds, notes, or other obligations outstanding. Upon                                                                       
     termination of the authority, its rights and property pass to                                                              
     the state.                                                                                                                 
                                                                                                                                
Commissioner  Barton stated that  the toll revenues generated  from                                                             
the bridge would fund the operational costs of the bridge.                                                                      
                                                                                                                                
Co-Chair Wilken asked the role  of the Authority upon completion of                                                             
the  bridge,   specifically,  he   asked  why  the  Department   of                                                             
Transportation and Public Facilities  could not operate the bridge.                                                             
                                                                                                                                
Commissioner Barton stated that  the autonomy of the Authority must                                                             
be maintained  until the  bond obligation  is fulfilled or  another                                                             
mechanism of paying off the bonds is established.                                                                               
                                                                                                                                
Co-Chair  Wilken opined that  the three-person  Authority could  be                                                             
maintained;  however,  the  Department  could  oversee  the  bridge                                                             
operations.                                                                                                                     
                                                                                                                                
Commissioner Barton conveyed that this might be possible.                                                                       
                                                                                                                                
Senator Bunde pointed  out that the Department's fiscal  note could                                                             
be considered "seed money" as the  bridge's administrative expenses                                                             
would by paid by  toll revenue rather than by State  money once the                                                             
bridge was operational.                                                                                                         
                                                                                                                                
Senator Hoffman asked  whether other State boards include  Governor                                                             
appointees with no specific background or "ties" to the program.                                                                
                                                                                                                                
Commissioner  Barton  responded  that the  Governor  also  appoints                                                             
individuals to the Boards of the Alaska Railroad Corporation, AHFC,                                                             
and AIDEA.                                                                                                                      
                                                                                                                                
Senator Hoffman  expressed that he  would be sponsoring  amendments                                                             
that would  address  the composition  of the  Authority's Board  to                                                             
provide for  a higher level of  involvement by the Municipality  of                                                             
Anchorage and the  Mat-Su Borough as well as the inclusion  of non-                                                             
voting  State legislators,  one from  the Senate  and one from  the                                                             
House of Representatives, on the Board.                                                                                         
                                                                                                                                
Co-chair Wilken summarized that these issues would be addressed at                                                              
a follow-up meeting. He ordered the bill HELD in Committee.                                                                     
                                                                                                                                
ADJOURNMENT                                                                                                                 
                                                                                                                                
Co-Chair Gary Wilken adjourned the meeting at 11:02 AM                                                                          

Document Name Date/Time Subjects