Legislature(2009 - 2010)SENATE FINANCE 532

03/08/2010 09:00 AM Senate FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 221 LEGISLATIVE TASK FORCE ON HIGHER ED TELECONFERENCED
Heard & Held
+= SB 269 ECON. STIMULUS BONDS: REALLOCATION/WAIVER TELECONFERENCED
Scheduled But Not Heard
+= SB 270 AK HOUSING FIN CORP DIVIDEND TELECONFERENCED
Moved SB 270 Out of Committee
+ SJR 21 CONST. AM: INCREASE NUMBER OF LEGISLATORS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                 SENATE FINANCE COMMITTEE                                                                                       
                       March 8, 2010                                                                                            
                         9:08 a.m.                                                                                              
                                                                                                                                
                                                                                                                                
9:08:09 AM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stedman called the Senate Finance Committee                                                                            
meeting to order at 9:08 a.m.                                                                                                   
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Dennis Egan                                                                                                             
Senator Donny Olson                                                                                                             
Senator Joe Thomas                                                                                                              
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Charlie Huggins, Vice-Chair                                                                                             
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Senator  Gary  Stevens;  Tim  Lamkin,  Staff,  Senator  Gary                                                                    
Stevens;  David   Gray,  Staff,  Co-Chair   Hoffman;  Gordon                                                                    
Harrison,  Former  Director,  Legislative  Research  Agency;                                                                    
Former Executive Director,  Alaska Redistricting Commission;                                                                    
Senator Gary Stevens                                                                                                            
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Marilyn Barry, Alaska Pacific University                                                                                        
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SB 221    LEGISLATIVE TASK FORCE ON HIGHER ED                                                                                   
                                                                                                                                
          SB 221 was heard and HELD in Committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
SB 269    ECON. STIMULUS BONDS: REALLOCATION/WAIVER                                                                             
                                                                                                                                
          SB 269 was scheduled but not heard.                                                                                   
                                                                                                                                
SB 270    AK HOUSING FIN CORP DIVIDEND                                                                                          
                                                                                                                                
          SB 270 was REPORTED out of Committee with a "do                                                                       
          pass" recommendation and with zero FN 1 (REV).                                                                        
                                                                                                                                
SJR 21    CONST. AM: INCREASE NUMBER OF LEGISLATORS                                                                             
                                                                                                                                
          SJR 21 was heard and HELD in Committee for                                                                            
          further consideration.                                                                                                
                                                                                                                                
SENATE BILL NO. 221                                                                                                           
                                                                                                                                
     "An Act establishing an advisory task force on higher                                                                      
     education in the legislative branch of government; and                                                                     
     providing for an effective date."                                                                                          
                                                                                                                                
9:08:31 AM                                                                                                                    
                                                                                                                                
SENATOR GARY STEVENS, sponsor of  SB 221, explained that the                                                                    
bill  was  a direct  result  of  having read,  Crossing  the                                                                  
Finish Line, by William G.  Bowen. He reported being shocked                                                                  
by the conclusions  on college completion made  in the book.                                                                    
The  University  of  Alaska  has  been  dedicated  to  equal                                                                    
opportunity to affordability for  students. It is a sobering                                                                    
fact that less than 60  percent of students entering a four-                                                                    
year college graduate.                                                                                                          
                                                                                                                                
Senator Stevens related  that the task force  created by the                                                                    
bill  will be  charged with  finding out  the reason  behind                                                                    
that statistic and solutions to  the problem. He quoted from                                                                    
Bowen's book,  "Educational attainment in the  United States                                                                    
today is  highly consequential." He  said he has  found that                                                                    
statement to be  true in his experience.  There are enormous                                                                    
consequences   from   getting   an  education.   He   shared                                                                    
statistics   about   individual,  economic,   and   societal                                                                    
benefits of  holding a  college degree.  He agreed  with the                                                                    
title of  the book's analogy of  comparing post-secondary to                                                                    
running a  foot race. Many  compete, but 40 percent  fall by                                                                    
the  wayside along  the  way. He  listed  the roadblocks  to                                                                    
success.                                                                                                                        
                                                                                                                                
Senator Stevens  informed the committee  as to the  goals of                                                                    
the task  force, such as  to decrease the need  for remedial                                                                    
education,   to  provide   counseling,  to   help  integrate                                                                    
students into campus life, and to increase retention rates.                                                                     
Senator Stevens  summarized that  the main  job of  the task                                                                    
force  is  to  help  the educational  community  to  prepare                                                                    
students for their future.                                                                                                      
                                                                                                                                
9:14:44 AM                                                                                                                    
                                                                                                                                
TIM LAMKIN,  STAFF, SENATOR GARY  STEVENS, stated  that CSSB
221 (EDC) would  establish as task force  that would consist                                                                    
of 18 members  and encompass all of the  stakeholders in the                                                                    
education pipeline  to identify ways to  improve preparation                                                                    
for  college,  decrease   remediation,  increase  access  to                                                                    
financial aid, increase retention  and graduation rates, and                                                                    
track  data. The  task force  members would  consist of  the                                                                    
governor or the governor's  designee, the executive director                                                                    
of the  Alaska Commission on Postsecondary  Education or the                                                                    
executive   director's   designee,   the   commissioner   of                                                                    
education  and  early   development  or  the  commissioner's                                                                    
designee,  one   member  appointed   by  the   governor  who                                                                    
represents     vocational,     technical    training,     or                                                                    
apprenticeship   programs   in    the   state,   a   student                                                                    
representative  appointed  by  the Board  of  Education  and                                                                    
Early  Development,  the  student  member of  the  Board  of                                                                    
Regents  of  the  University  of  Alaska  or  the  student's                                                                    
designee, the president  of the University of  Alaska or the                                                                    
president's   designee,  the   executive  director   of  the                                                                    
Association  of  Alaska  School   Boards  or  the  executive                                                                    
director's designee,  the executive  director of  the Alaska                                                                    
Association  of  School   Administrators  or  the  executive                                                                    
director's   designee,  the   president   of  the   National                                                                    
Education   Association  of   Alaska   or  the   president's                                                                    
designee, the president of the  Alaska Federation of Natives                                                                    
or  the  president's  designee,  the  chair  of  the  Senate                                                                    
committee having  jurisdiction over education, the  chair of                                                                    
the House committee having  jurisdiction over education, one                                                                    
member  appointed by  the  governor  who represents  private                                                                    
colleges  or  universities,  one  member  appointed  by  the                                                                    
governor  who represents  public postsecondary  institutions                                                                    
and who  is not  affiliated with  the University  of Alaska,                                                                    
three   members  appointed   by   the   governor  who   have                                                                    
specialized  knowledge, skill,  or  experience in  education                                                                    
remediation   and   who   are   employed   as   faculty   at                                                                    
postsecondary   institutions  located   in  separate   major                                                                    
administrative  units in  the state,  at least  one of  whom                                                                    
resides outside of Anchorage, Fairbanks, and Juneau.                                                                            
                                                                                                                                
Mr. Lamkin  summarized that the  task force would  be tasked                                                                    
with a  number of research  and data compilations.  The bill                                                                    
attempts to improve the education system in Alaska.                                                                             
                                                                                                                                
9:17:30 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman asked how the  selection for the task force                                                                    
would take place when there  are two co-chairs on the Senate                                                                    
Education Committee. Senator Stevens  replied that there was                                                                    
no  intention  to  exclude  anyone.   He  mentioned  that  a                                                                    
superintendent  was   added  to  the  task   force  after  a                                                                    
suggestion was  made. He  thought only  one member  from the                                                                    
education  committee should  be included  and suggested  the                                                                    
wording could be changed to "chairs or co-chairs."                                                                              
                                                                                                                                
Senator   Thomas  commented   that  from   looking  at   the                                                                    
governor's   proposed  scholarship   plan,  it   has  become                                                                    
apparent   that  the   current  education   structure  needs                                                                    
addressing.  The  legislation  will   address  some  of  the                                                                    
problems  related  to  why students  are  not  prepared  for                                                                    
college.                                                                                                                        
                                                                                                                                
9:19:08 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman noted  three  zero fiscal  notes: two  are                                                                    
from the Department of Education  and Early Development, and                                                                    
one is from the Legislature.                                                                                                    
                                                                                                                                
9:19:31 AM                                                                                                                    
                                                                                                                                
MARILYN  BARRY,  ALASKA  PACIFIC UNIVERSITY,  testified  via                                                                    
teleconference.  She spoke  in support  of the  legislation.                                                                    
She thought  it important  to distinguish  between different                                                                    
types of students and their  needs for remediation. Co-Chair                                                                    
Stedman asked what  her job was. Ms. Barry said  she was the                                                                    
academic dean.                                                                                                                  
                                                                                                                                
9:21:34 AM                                                                                                                    
                                                                                                                                
SB  221  was  heard  and   HELD  in  Committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
AT-EASE        9:22:25 AM                                                                                                     
RECONVENED     9:23:34 AM                                                                                                     
                                                                                                                                
                                                                                                                                
SENATE BILL NO. 270                                                                                                           
                                                                                                                                
     "An Act relating to the dividend paid to the state by                                                                      
     the Alaska Housing Finance Corporation; and providing                                                                      
     for an effective date."                                                                                                    
                                                                                                                                
9:24:53 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman noted  it was the second hearing  on SB 270                                                                    
and he  intended to move  it from committee.  He highlighted                                                                    
one zero fiscal note from the Department of Revenue.                                                                            
                                                                                                                                
Senator Ellis MOVED  to report SB 270 out  of Committee with                                                                    
individual  recommendations  and   the  accompanying  fiscal                                                                    
note.                                                                                                                           
                                                                                                                                
SB  270 was  REPORTED  out  of Committee  with  a "do  pass"                                                                    
recommendation and with zero FN 1 (REV).                                                                                        
                                                                                                                                
SENATE JOINT RESOLUTION NO. 21                                                                                                
                                                                                                                                
     Proposing amendments to the Constitution of the State                                                                      
     of Alaska relating to and increasing the number of                                                                         
     members of the House of Representatives to forty-eight                                                                     
     and the number of members of the senate to twenty-                                                                         
     four.                                                                                                                      
                                                                                                                                
9:24:59 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman turned to SJR 21.                                                                                              
                                                                                                                                
Senator  Olson,  sponsor  of  SJR 21  and  chair  of  Senate                                                                    
Community  and Regional  Affairs,  introduced  the bill.  He                                                                    
requested  that   his  staff  answer  questions   about  the                                                                    
resolution.                                                                                                                     
                                                                                                                                
DAVID  GRAY, STAFF,  CO-CHAIR HOFFMAN,  shared  that he  has                                                                    
been working on the legislation for a number of years.                                                                          
                                                                                                                                
Senator Olson  explained that SJR  21 puts  a constitutional                                                                    
amendment  before the  voters in  the 2010  general election                                                                    
that would increase  the size of the legislature  from 40 to                                                                    
48 representatives  and from 20  to 24 senators.  Upon voter                                                                    
approval, the measure would apply  to the 2012 determination                                                                    
of election district boundaries.                                                                                                
                                                                                                                                
Senator   Olson   provided   the  history   of   legislative                                                                    
representation.  In  1913,  Congress established  the  first                                                                    
territorial   legislature    with   8   senators    and   16                                                                    
representatives. The  size of the legislature  was increased                                                                    
to  12 senators  and 24  representatives in  1942. Seventeen                                                                    
years  later,  in 1959,  a  constitution  for the  state  of                                                                    
Alaska  was  ratified further  increasing  the  size of  the                                                                    
legislature to the current level.                                                                                               
                                                                                                                                
Senator  Olson  related  that  in  the  first  50  years  of                                                                    
statehood,  Alaska   has  not   changed  the  size   of  its                                                                    
legislative body. It continues  to be the smallest bicameral                                                                    
legislature in  the nation.  During this  span of  time, the                                                                    
population of the  state has more than  tripled. The state's                                                                    
operating budget, which was around  $100 million in 1960, is                                                                    
now up  to $10 billion.  In spite of those  increases, there                                                                    
has been no change to legislative representation.                                                                               
                                                                                                                                
Senator  Olson referred  to the  approaching census  and the                                                                    
resulting  need for  redistricting. He  noted that  the 1965                                                                    
Voter Rights Act will play  a part in the redistricting, and                                                                    
large  areas  containing   small  populations  will  further                                                                    
complicate  Alaska's  apportionment  process.  He  predicted                                                                    
population distributions,  as a  result of the  2010 census,                                                                    
that will  not reconcile Article VI,  section 6 requirements                                                                    
of the Alaska Constitution.                                                                                                     
                                                                                                                                
9:28:54 AM                                                                                                                    
                                                                                                                                
Senator Olson  recalled numerous lawsuits in  2000 regarding                                                                    
equal  access. He  related that  between 1960  and 2006,  29                                                                    
states have increased the size  of their legislative bodies.                                                                    
For  the  nine  states  that  have  populations  similar  to                                                                    
Alaska's  -  between  500,000 and  1,500,000  people  -  the                                                                    
average size of their legislative bodies is 134 members.                                                                        
                                                                                                                                
Senator  Olson stressed  that it  was time  to increase  the                                                                    
size of the legislature.                                                                                                        
                                                                                                                                
9:30:10 AM                                                                                                                    
                                                                                                                                
Senator   Olson  noted   that  a   constitutional  amendment                                                                    
requires a  two-thirds majority  in each  body and  then the                                                                    
voters must ratify  it. He emphasized that  the voters would                                                                    
make the  ultimate decision to  increase the  legislature or                                                                    
keep it the  same. He implored the committee  to support the                                                                    
legislation and vote on it today.                                                                                               
                                                                                                                                
Co-Chair Stedman understood the  urgency of the legislation.                                                                    
He thought there should also be  time for the public and the                                                                    
committee to process the bill.                                                                                                  
                                                                                                                                
Co-Chair  Stedman  referred  to  a table  in  the  committee                                                                    
members'  file  entitled,  "Population  Trend  for  Election                                                                    
Districts  in   2010"  (copy  on  file).   He  commented  on                                                                    
population differences and  requested more information about                                                                    
areas where the population has increased or decreased.                                                                          
                                                                                                                                
Senator Olson agreed that would  be valuable information. He                                                                    
pointed out that  there is a significant  population loss in                                                                    
election districts  1 -  6, which is  the Southeast  part of                                                                    
Alaska as  well as  part of  the Interior.  There is  also a                                                                    
significant loss in Northwest  Alaska and in Western Alaska,                                                                    
which  includes  Bristol  Bay,  Bethel,  Nome,  Barrow,  and                                                                    
Kotzebue.  There are  population losses  "in the  4000 area"                                                                    
which  significantly decreases  the number  of people  in an                                                                    
election district.  There are also significant  increases in                                                                    
MatSu, Anchorage, and Kenai.                                                                                                    
                                                                                                                                
Senator Olson  concluded that the effect  of the resolution,                                                                    
if approved  by the voters,  would keep the  rural districts                                                                    
the same in Southeast and  Western Alaska. It would increase                                                                    
the number of  election districts in the MatSu  area by 2.5,                                                                    
in Fairbanks  by 1, in Anchorage  by 3.5, and possibly  1 in                                                                    
the Kenai area.                                                                                                                 
                                                                                                                                
9:35:04 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman asked if there  has been any thought to the                                                                    
physical  accommodations in  the legislature.  Senator Olson                                                                    
suggested  Mr.  Gray  respond to  the  issue  of  population                                                                    
trends and  effects of  new election  districts, as  well as                                                                    
the matter of space accommodations.                                                                                             
                                                                                                                                
Mr. Gray clarified  that in some cases  rural districts have                                                                    
lost  population,  but  others  have not  had  a  population                                                                    
increase as fast as some  urban areas. He explained that the                                                                    
chart showing  where new election districts  would go simply                                                                    
looks  at population.  The reapportionment  board will  make                                                                    
the decision as to where  the new election districts will be                                                                    
located.                                                                                                                        
                                                                                                                                
Mr.  Gray   addressed  Co-Chair  Stedman's   question  about                                                                    
whether  the legislature  could  physically accommodate  new                                                                    
members. He  deferred to Legislative  Affairs to  answer. He                                                                    
speculated that it would require some modifications.                                                                            
                                                                                                                                
9:37:21 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman proposed a scenario  where there would be a                                                                    
loss of 3,700  people in Ketchikan's House  District One. He                                                                    
suggested that  the resolution  would hold  the geographical                                                                    
footprint constant  in District 1,  but allow the  number of                                                                    
elected representatives in the  MatSu and Anchorage areas to                                                                    
increase.  That  concept  would expand  to  include  all  of                                                                    
Southeast  Alaska as  well as  Western Alaska,  the Aleutian                                                                    
Chain, and Kodiak.                                                                                                              
                                                                                                                                
Mr.  Gray said  that was  correct. He  added that  the ideal                                                                    
district should  have 15,673 people  in it according  to the                                                                    
current  reapportionment plan.  If  the plan  is changed  in                                                                    
2010, the ideal population per  district would be 17,309. He                                                                    
noted that an  increase in the size of the  legislature by 8                                                                    
representatives  would  change  the average  population  per                                                                    
district  to  14,424,  which  is   closer  to  the  required                                                                    
population in the  2000 census and the  possibility that the                                                                    
rural districts would remain the same.                                                                                          
                                                                                                                                
9:39:46 AM                                                                                                                    
                                                                                                                                
Senator Thomas suggested  that a balance of  power exists in                                                                    
the state  and expanding the  numbers would create  a change                                                                    
in  that balance.  Mr. Gray  pointed out  that it  is a  one                                                                    
person, one vote state. When  the population shifts there is                                                                    
still  equal representation.  The  population  growth is  in                                                                    
urban  areas,  not  rural  areas.  He  maintained  that  the                                                                    
distribution  under the  48 House  District scheme,  has the                                                                    
same balance of power.                                                                                                          
                                                                                                                                
Senator Olson  stressed that power  in rural Alaska  will be                                                                    
lost  if the  current distribution  continues, because  they                                                                    
will  be assimilated  into  more  populated districts.  This                                                                    
legislation  attempts to  facilitate the  balance of  power.                                                                    
Senator Thomas  understood that the  balance of  power would                                                                    
be lost unless a change  in the number of representatives is                                                                    
made.                                                                                                                           
                                                                                                                                
9:44:12 AM                                                                                                                    
                                                                                                                                
Senator  Olson  requested  that Mr.  Harrison  address  that                                                                    
issue.                                                                                                                          
                                                                                                                                
GORDON   HARRISON,  FORMER   DIRECTOR  OF   THE  LEGISLATIVE                                                                    
RESEARCH  AGENCY;   FORMER  EXECUTIVE  DIRECTOR   OF  ALASKA                                                                    
REDISTRICTING  COMMISSION, requested  that  the question  be                                                                    
repeated.   Senator  Thomas   restated  his   question.  Mr.                                                                    
Harrison  did  not  see  how  the  proposal  to  expand  the                                                                    
legislature  would  change  the  distribution  of  electoral                                                                    
power between the rural and  urban areas because it is based                                                                    
on population. He said the  rural districts would be able to                                                                    
maintain  their physical  size,  while  the urban  districts                                                                    
would be  smaller in area. Proportionally,  the relationship                                                                    
between rural and urban Alaska would remain the same.                                                                           
                                                                                                                                
Senator   Thomas   pointed   out    that   the   number   of                                                                    
representatives  is being  added to  urban areas,  therefore                                                                    
there would  be more  influence. Co-Chair  Stedman requested                                                                    
an  explanation of  the  difference  between a  geographical                                                                    
area  and a  population  area. Mr.  Harrison explained  that                                                                    
without an  expansion of the  legislature, there would  be a                                                                    
loss of  three rural districts. In  the expanded legislature                                                                    
the   rural   districts   would  be   maintained   and   the                                                                    
relationship between  rural and  urban areas would  stay the                                                                    
same.                                                                                                                           
                                                                                                                                
9:48:46 AM                                                                                                                    
                                                                                                                                
Senator  Olson  noted   valid  concerns  regarding  physical                                                                    
space. Co-Chair Stedman  noted the recent purchase  of a new                                                                    
building for the purposes of expansion.                                                                                         
                                                                                                                                
Co-Chair  Stedman commented  on  the two  fiscal notes.  One                                                                    
note is from  the Division of Elections for  $1.5 million to                                                                    
cover the  cost of  printing the ballots.  One note  is from                                                                    
the Legislature reflecting the cost  of adding 12 additional                                                                    
legislators beginning in FY 13  for $6,140,000. In FY 14 the                                                                    
cost is estimated to decrease to $4,470,000.                                                                                    
                                                                                                                                
SJR  21  was  heard  and   HELD  in  Committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
SENATE BILL NO. 269                                                                                                           
                                                                                                                                
     "An Act relating to the waiver of volume cap of                                                                            
     recovery zone economic development bonds authorized by                                                                     
     26 U.S.C. 1400U-2 and reallocation by the Alaska                                                                           
     Municipal Bond Bank Authority of the waived volume                                                                         
     cap; relating to the waiver of volume cap of recovery                                                                      
     zone facility bonds authorized by 26 U.S.C. 1400U-3                                                                        
     and reallocation by the Alaska Industrial Development                                                                      
     and Export Authority of the waived volume cap;                                                                             
     increasing the total amount of bonds and notes that                                                                        
     the Alaska Municipal Bond Bank Authority may have                                                                          
     outstanding; relating to revenue bonds issued by the                                                                       
     Alaska Municipal Bond Bank Authority; and providing                                                                        
     for an effective date."                                                                                                    
                                                                                                                                
Senate Bill 269 was scheduled but not heard.                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 9:50 AM.                                                                                           

Document Name Date/Time Subjects
NCSL Presentation on Alaska Higher Ed Task Force_SB221[1].ppt SFIN 3/8/2010 9:00:00 AM
SB 221
SB221 NCSL Path to a Degree - Overview[1].pdf SFIN 3/8/2010 9:00:00 AM
SB 221
SB221_Sectional[1].pdf HEDC 3/26/2010 8:00:00 AM
SFIN 3/8/2010 9:00:00 AM
SB 221
SB221_SponsorStatement[1].pdf HEDC 3/26/2010 8:00:00 AM
SFIN 3/8/2010 9:00:00 AM
SB 221
SB 221 NCSL Path to a Degree - Engaging Students_ College Success Strategies[1].pdf SFIN 3/8/2010 9:00:00 AM
SB 221
SB 221 The Path To A Degree[1].pdf SFIN 3/8/2010 9:00:00 AM
SB 221
SB 269 Principal Amortization-Update (2 24 10).pdf SFIN 3/8/2010 9:00:00 AM
SB 269
SB 269 2005 Resolution Borrower Loan Payments.pdf SFIN 3/8/2010 9:00:00 AM
SB 269
SJR 21 Alaska Supreme Court. redistricting[1].pdf SFIN 3/8/2010 9:00:00 AM
SJR21 sponsor statement[1].pdf SFIN 3/8/2010 9:00:00 AM
SFIN 3/15/2010 9:00:00 AM
SJR 21
SJR 21 Population Trend 2010 districts[1].pdf SFIN 3/8/2010 9:00:00 AM
SFIN 3/15/2010 9:00:00 AM
SJR 21