Legislature(2013 - 2014)SENATE FINANCE 532

03/26/2013 09:00 AM Senate FINANCE


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09:21:46 AM Start
09:22:08 AM HB65 || HB66
04:30:43 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 65 APPROP: OPERATING BUDGET/LOANS/FUNDS TELECONFERENCED
Moved SCS CSHB 65(FIN) Out of Committee
+= HB 66 APPROP: MENTAL HEALTH BUDGET TELECONFERENCED
Moved SCS CSHB 66(FIN) Out of Committee
Bills Previously Heard/Scheduled
                 SENATE FINANCE COMMITTEE                                                                                       
                      March 26, 2013                                                                                            
                         9:21 a.m.                                                                                              
                                                                                                                                
                                                                                                                                
9:21:46 AM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Kelly called the Senate Finance Committee meeting                                                                      
to order at 9:21 a.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Pete Kelly, Co-Chair                                                                                                    
Senator Kevin Meyer, Co-Chair                                                                                                   
Senator Anna Fairclough, Vice-Chair                                                                                             
Senator Click Bishop                                                                                                            
Senator Mike Dunleavy                                                                                                           
Senator Lyman Hoffman                                                                                                           
Senator Donny Olson                                                                                                             
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Karen Rehfeld, Director, Office of Management and Budget,                                                                       
Office of the Governor; James Armstrong, Staff, Senator                                                                         
Pete Kelly.                                                                                                                     
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
CSHB 65(FIN)   APPROP: OPERATING BUDGET/LOANS/FUNDS                                                                             
                                                                                                                                
          SCS CSHB 65(FIN) was REPORTED out of committee                                                                        
          with a "do pass" recommendation.                                                                                      
                                                                                                                                
CSHB 66(FIN)   APPROP: MENTAL HEALTH BUDGET                                                                                     
                                                                                                                                
          SCS CSHB 66(FIN) was REPORTED out of committee                                                                        
          with a "do pass" recommendation.                                                                                      
                                                                                                                                
CS FOR HOUSE BILL NO. 65(FIN)                                                                                                 
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     loan  program  expenses  of state  government  and  for                                                                    
     certain  programs,   capitalizing  funds,   and  making                                                                    
     reappropriations;  and   providing  for   an  effective                                                                    
     date."                                                                                                                     
                                                                                                                                
CS FOR HOUSE BILL NO. 66(FIN)                                                                                                 
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     capital    expenses   of    the   state's    integrated                                                                    
     comprehensive  mental  health   program  and  making  a                                                                    
     reappropriation; and providing for an effective date."                                                                     
                                                                                                                                
9:22:08 AM                                                                                                                    
                                                                                                                                
Senator Dunleavy noted that the concept of funding                                                                              
education at the district level would still occur and                                                                           
explained that "this" was the department's budget.                                                                              
                                                                                                                                
Co-Chair Kelly observed that Senator Olson was absent for a                                                                     
medical issue.                                                                                                                  
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 1.                                                                                      
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 1                                                                                         
                                                                                                                                
     OFFERED BY: Senator Kelly                                                                                                  
                                                                                                                                
     LANGUAGE                                                                                                                 
                                                                                                                                
     Amend  the SALARY  AND  BENEFIT ADJUSTMENTS  subsection                                                                    
     (a) as follows:                                                                                                            
                                                                                                                                
     SALARY  AND  BENEFIT  ADJUSTMENTS.  (a)  The  operating                                                                    
     budget  appropriations  made  in  sec. 1  of  this  Act                                                                    
     include amounts for salary  and benefit adjustments for                                                                    
     public  officials,  officers,   and  employees  of  the                                                                    
     executive  branch,   Alaska  Court   System  employees,                                                                    
     employees of  the legislature,  and legislators  and to                                                                    
     implement  the terms  for the  fiscal year  ending June                                                                    
     30,  2014,  of   the  following  collective  bargaining                                                                    
     agreements:                                                                                                                
                                                                                                                                
     (1)  Alaska   Vocational  Technical   Center  Teachers'                                                                    
     Association,     National    Education     Association,                                                                    
     representing  the employees  of  the Alaska  Vocational                                                                    
     Technical Center;                                                                                                          
                                                                                                                                
     (2) International  Organization of Masters,  Mates, and                                                                    
     Pilots, for the masters, mates, and pilots unit;                                                                           
                                                                                                                                
     (3)  Inlandboatmen's  Union   of  the  Pacific,  Alaska                                                                    
     Region, for the unlicensed marine unit;                                                                                    
                                                                                                                                
     (4)    Marine   Engineers'    Beneficial   Association,                                                                    
     representing licensed engineers  employed by the Alaska                                                                    
     marine highway system;                                                                                                     
                                                                                                                                
     (5) Public  Safety Employees  Association, representing                                                                    
     the  regularly  commissioned   public  safety  officers                                                                    
     unit;                                                                                                                      
                                                                                                                                
     (6) Public  Employees Local 71,  for the  labor, trades                                                                    
     and crafts unit;                                                                                                           
                                                                                                                                
     (7) Teachers' Education Association of Mt. Edgecumbe;                                                                      
                                                                                                                                
     (8)    Alaska   Correctional    Officers   Association,                                                                    
     representing correctional officers;                                                                                        
                                                                                                                                
     (9)  Alaska  Public   Employees  Association,  for  the                                                                    
     supervisory unit;                                                                                                          
                                                                                                                                
     (10)  Alaska  Public  Employees  Association,  for  the                                                                    
     confidential unit;                                                                                                         
                                                                                                                                
     (11)  Alaska  State   Employees  Association,  for  the                                                                    
     general government unit;                                                                                                   
                                                                                                                                
     EXPLANATION:                                                                                                               
     The State  of Alaska  Department of  Administration has                                                                    
     reached  agreements on  three-year successor  contracts                                                                    
     with   the   Alaska    Public   Employees   Association                                                                    
     representing  the   Supervisory  Unit,   Alaska  Public                                                                    
     Employees  Association  representing  the  Confidential                                                                    
     Unit,  and  the   Alaska  State  Employees  Association                                                                    
     representing the General  Government Unit, covering the                                                                    
     period of July 1, 2013 through June 30, 2016.                                                                              
                                                                                                                                
     DEPARTMENT: Various                                                                                                        
     DEPARTMENT: Various                                                                                                        
     DEPARTMENT: Various                                                                                                        
                                                                                                                                
     (See  table on  the second  page of  Amendment 1  for a                                                                    
     copy on file.)                                                                                                             
                                                                                                                                
     EXPLANATION:                                                                                                               
     The  State of  Alaska Department of  Administration has                                                                    
     reached agreements on three-year successor contracts with                                                                  
     the Alaska Public Employees Association (representing the                                                                  
     Supervisory Unit),  Alaska Public Employees Association                                                                    
     (representing the  Confidential Unit),  and  the Alaska                                                                    
     State  Employees Association (representing  the General                                                                    
     Government Unit),  covering the  period of  July 1,2013                                                                    
     through June 30, 2016. This amendment provides funding to                                                                  
     implement the terms of the agreements in FYI4.                                                                             
                                                                                                                                
     DEPARTMENT: Branch-wide Unallocated                                                                                        
     APPROPRIATION: Branch-wide Unallocated                                                                                     
     ALLOCATION: Branch-wide Unallocated                                                                                        
                                                                                                                                
     LANGUAGE                                                                                                                 
                                                                                                                                
     Amend: Sec.  21. OFFICE OF  THE GOVERNOR., by  adding a                                                                    
     new subsection to read:                                                                                                    
     (f) The  amount necessary, estimated to  be $9,328,500,                                                                    
     is  appropriated  to the  Office  of  the Governor  for                                                                    
     distribution to  state agencies to  pay for a  lump sum                                                                    
     payment  as  negotiated  in the  collective  bargaining                                                                    
     agreement  between  the  State  and  the  Alaska  State                                                                    
     Employees   Association   (representing   the   General                                                                    
     Government Unit) from the  following fund sources: (see                                                                    
     copy on file for the table of fund sources)                                                                                
                                                                                                                                
     EXPLANATION:                                                                                                               
     Under the new contract  negotiated between the State of                                                                    
     Alaska  and  the  Alaska  State  Employees  Association                                                                    
     (representing the  General Government  Unit), employees                                                                    
     in pay status  on July 1,2013, will receive  a lump sum                                                                    
     payment  of$755  in the  second  pay  period in  August                                                                    
     2013.                                                                                                                      
                                                                                                                                
     The  estimated  amounts  listed in  the  amendment  are                                                                    
     based on  9,488 employees being  in pay status  on that                                                                    
     date  (which   is  the   budgeted  number   of  General                                                                    
     Government Unit  employees in FY20 14).  The Department                                                                    
     of  Administration will  issue  payments  based on  the                                                                    
     fund sources used to pay  regular paychecks to eligible                                                                    
     employees.  Funding  amounts  have  been  adjusted  for                                                                    
    vacancy and include the following employer charges:                                                                         
                                                                                                                                
     SBS- 6.13%                                                                                                                 
     PERS- 22.00%                                                                                                               
     Terminal Leave- 1.14%                                                                                                      
     Leave Cash in- 2.30%                                                                                                       
     Medicare tax- 1.45%                                                                                                        
     Unemployment- 0.50%                                                                                                        
     Workers Compensation % varies by department                                                                                
     For DEC, leave/holiday pool- 26.50%                                                                                        
                                                                                                                                
Co-Chair Meyer OBJECTED for the purpose of discussion.                                                                          
                                                                                                                                
Co-Chair  Kelly related  that  Amendment  1 represented  the                                                                    
contracts that were just negotiated.                                                                                            
                                                                                                                                
KAREN REHFELD,  DIRECTOR, OFFICE  OF MANAGEMENT  AND BUDGET,                                                                    
OFFICE  OF THE  GOVERNOR, discussed  Amendment 1  and shared                                                                    
that it  was a request for  three bargaining-unit agreements                                                                    
that  were negotiated  by the  Department of  Administration                                                                    
(DOA)  for  the  general government  unit,  the  supervisory                                                                    
unit, and  the confidential employees unit.  She stated that                                                                    
DOA had  been able to  negotiate a 1  percent cost-of-living                                                                    
adjustment (COLA)  for FY14, as  well as 1  percent increase                                                                    
in FY15  and a  2.5 percent increase  for FY16.  She pointed                                                                    
out that  the amendment  also included a  one-time, lump-sum                                                                    
payment for the general government unit.                                                                                        
                                                                                                                                
JAMES  ARMSTRONG, STAFF,  SENATOR PETE  KELLY, related  that                                                                    
later in the process there  would be a motion for conforming                                                                    
language and  that Amendment 1  would be the target  of that                                                                    
motion.                                                                                                                         
                                                                                                                                
9:25:05 AM                                                                                                                    
                                                                                                                                
Vice-Chair   Fairclough  expressed   appreciation  for   the                                                                    
presentation  on  state  employee  contracts  that  Co-Chair                                                                    
Kelly  had put  together and  observed that  there had  also                                                                    
been a  presentation on fiscal  policy and the  direction of                                                                    
the  budget.  She  was  thankful  for  the  efforts  of  the                                                                    
negotiation teams that were  representing state employees in                                                                    
the   bargaining   contract.   She  also   appreciated   the                                                                    
administration's  effort to  hold  cost  controls down.  She                                                                    
mentioned  that some  of  the  information under  "contracts                                                                    
101"  had  indicated  that  there  had  been  a  28  percent                                                                    
increase  in wages  that were  negotiated in  the past;  she                                                                    
offered that  the committee needed  to "hold  those numbers"                                                                    
as  tight  as  possible.  She  explained  that  the  current                                                                    
revenue  stream had  fiscal shortfalls  and  that the  state                                                                    
could be reaching  into its savings account as  early as the                                                                    
current year. She expressed a  need to maintain a tight rein                                                                    
on the  budget in order  to insure that Alaska  could manage                                                                    
the cost increases.                                                                                                             
                                                                                                                                
Co-Chair Kelly  stated that he  did not have his  notes from                                                                    
"contracts  101" in  front  of him,  but  believed that  the                                                                    
figure Vice-Chair Fairclough had  referenced was actually 38                                                                    
percent and not  28 percent. He pointed out  that the system                                                                    
not  only had  contract  increases, but  also had  automatic                                                                    
increases.   He   expressed   appreciation  for   what   the                                                                    
administration   had  done   regarding  leave   accrual.  He                                                                    
concluded that  "it" was  a topic  that the  committee would                                                                    
have  to discuss  throughout the  session and  possibly over                                                                    
the interim.                                                                                                                    
                                                                                                                                
Vice-Chair  Fairclough  related  that   she  had  talked  to                                                                    
members  of the  Alaska State  Employees Association  (ASEA)                                                                    
and  other unions  and restated  that their  leave would  be                                                                    
"grandfathered"  in. She  furthered that  even though  there                                                                    
was a $164  million debt inside the  budget, the legislature                                                                    
would make sure  the leave was "held harmless"  and would be                                                                    
available to the people that had served Alaska.                                                                                 
                                                                                                                                
Co-Chair  Meyer  WITHDREW  his  OBJECTION.  There  being  NO                                                                    
further OBJECTION, Amendment 1 was ADOPTED.                                                                                     
                                                                                                                                
9:27:55 AM                                                                                                                    
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 2.                                                                                      
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 2                                                                                         
                                                                                                                                
     OFFERED BY: Senator Kelly                                                                                                  
                                                                                                                                
     DEPARTMENT: Fish and Game                                                                                                  
     APPROPRIATION: Commercial Fisheries                                                                                        
     ALLOCATION: Southeast Region Fisheries Management                                                                          
                                                                                                                                
     ADD: $150,000, Unrestricted General Fund Receipts                                                                          
     (1004)                                                                                                                     
                                                                                                                                
     EXPLANATION:                                                                                                               
     This amendment adds  $150,000 Unrestricted General Fund                                                                    
     Receipts  (UGF)  to  the Southeast  Regional  Fisheries                                                                    
     Management   allocation   to  continue   salmon   stock                                                                    
     identification projects expiring under the Federal                                                                         
     Alaska Sustainable Salmon Fishery Grants, restoring                                                                        
     the FY14 Governor's Request.                                                                                               
                                                                                                                                
Vice-Chair   Fairclough   OBJECTED   for  the   purpose   of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Co-Chair  Kelly discussed  Amendment 2  and inquired  if the                                                                    
amendment  reflected  something  that  was  removed  in  the                                                                    
House.  Mr. Armstrong  replied that  the  increment had  not                                                                    
been funded in the "other  body," but that $400,000 had been                                                                    
funded  in  the  subcommittee  process.  Amendment  2  would                                                                    
restore  the   governor's  request  of  $550,000   for  this                                                                    
particular southeast fisheries issue.                                                                                           
                                                                                                                                
Co-Chair Kelly  stated that there had  been public testimony                                                                    
regarding  southeast   regional  fisheries   management  and                                                                    
related  that former  State Representative  Bill Thomas  had                                                                    
made  a compelling  case  to  put the  funding  back in  the                                                                    
budget. He offered that most  of the people at the committee                                                                    
table were  on record as  supporting efforts to  create more                                                                    
fish.                                                                                                                           
                                                                                                                                
Vice-Chair  Fairclough WITHDREW  her OBJECTION.  There being                                                                    
NO further OBJECTION, Amendment 2 was ADOPTED.                                                                                  
                                                                                                                                
Co-Chair Kelly stated  that Amendment 3 had  been offered by                                                                    
Senator Hollis  French. He  recalled telling  Senator French                                                                    
that  he  would  gladly  consider ideas  to  ameliorate  the                                                                    
$19,000 cut to the advertising budget.                                                                                          
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 3.                                                                                      
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 3                                                                                         
                                                                                                                                
     OFFERED BY: Senator Kelly                                                                                                  
                                                                                                                                
     DEPARTMENT: Alaska Court System                                                                                            
     APPROPRIATION: Judicial Council                                                                                            
     ALLOCATION: Judicial Council                                                                                               
                                                                                                                                
     ADD: $19,000 Unrestricted General Fund 1004                                                                                
     ADD: It is the intent  of the legislature that no funds                                                                    
     allocated to  the Alaska Judicial  Council may  be used                                                                    
     for  advertising  in  response   to  campaigns  for  or                                                                    
     against a specific judge.                                                                                                  
                                                                                                                                
     Explanation:  Restores  funds   used  by  the  Judicial                                                                    
     Council  for public  advertising, with  the recommended                                                                    
     intent language.                                                                                                           
                                                                                                                                
Vice-Chair   Fairclough   OBJECTED   for  the   purpose   of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Co-Chair Kelly  continued explaining Amendment 3  and stated                                                                    
that it  added the  $19,000 and gave  clarification language                                                                    
that  the legislature  did not  want judicial  council being                                                                    
involved in campaigns.                                                                                                          
                                                                                                                                
Vice-Chair  Fairclough WITHDREW  her OBJECTION.  There being                                                                    
NO further OBJECTION, Amendment 3 was ADOPTED.                                                                                  
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 4.                                                                                      
                                                                                                                                
     FY14 OPERATING BUDGET AMENDMENT 4                                                                                          
                                                                                                                                
     OFFERED BY: Senator Kelly                                                                                                  
                                                                                                                                
     DEPARTMENT: Natural Resources                                                                                              
     APPROPRIATION: Parks & Outdoor Recreation                                                                                  
     ALLOCATION: Parks Management and Access                                                                                    
                                                                                                                                
     ADD:  It is  the  intent of  the  legislature that  the                                                                    
     Department  of  Natural  Resources negotiate  with  the                                                                    
     Office  of  the  Governor  to establish  the  House  of                                                                    
     Wickersham  State  Historic  Site as  lodging  for  the                                                                    
     Lieutenant  Governor while  in  the  capital; that  the                                                                    
     house  remain accessible  to the  public for  tours and                                                                    
     special  events  as  scheduled by  the  Office  of  the                                                                    
     Lieutenant  Governor;  and  that the  site  be  managed                                                                    
     within  the  existing  budgets of  the  Office  of  the                                                                    
     Lieutenant  Governor  and  the   Division  of  Parks  &                                                                    
     Outdoor Recreation.                                                                                                        
                                                                                                                                
Vice-Chair   Fairclough   OBJECTED   for  the   purpose   of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Co-Chair Kelly related that Amendment  4 had been offered by                                                                    
Senator Egan.                                                                                                                   
                                                                                                                                
Vice-Chair  Fairclough WITHDREW  her OBJECTION.  There being                                                                    
NO further OBJECTION, Amendment 4 was ADOPTED.                                                                                  
                                                                                                                                
9:31:22 AM                                                                                                                    
                                                                                                                                
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 5.                                                                                      
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 5                                                                                         
                                                                                                                                
     OFFERED BY: Senator Kelly                                                                                                  
                                                                                                                                
     DEPARTMENT: Department of Health and Social Services                                                                       
                                                                                                                                
     ADD INTENT:  It is the  intent of the  legislature that                                                                    
     the Department  of Health and Social  Services submit a                                                                    
     quarterly  report to  the legislature  of transfers  of                                                                    
     funding between appropriations.                                                                                            
                                                                                                                                
     EXPLANATION: Because  the Senate Finance  Committee has                                                                    
     provided  language  allowing  transfers of  up  to  $50                                                                    
     million  across appropriations,  the legislature  would                                                                    
     like quarterly  reports indicating where  the transfers                                                                    
     occur.                                                                                                                     
                                                                                                                                
Vice-Chair   Fairclough   OBJECTED   for  the   purpose   of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Co-Chair  Kelly observed  that  the  subcommittee had  given                                                                    
broad  authority  in  this  appropriation  and  that  intent                                                                    
language  would be  added that  required  the Department  of                                                                    
Health   and  Social   Services  to   report  back   to  the                                                                    
legislature  on a  quarterly  basis  regarding the  transfer                                                                    
activity.                                                                                                                       
                                                                                                                                
Vice-Chair  Fairclough WITHDREW  her OBJECTION.  There being                                                                    
NO further OBJECTION, Amendment 5 was ADOPED.                                                                                   
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 6.                                                                                      
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 6                                                                                         
                                                                                                                                
     DEPARTMENT:   Department   of   Education   and   Early                                                                    
     Development APPROPRIATION: N/A                                                                                             
     ALLOCATION: N/A                                                                                                            
                                                                                                                                
     ADD CONDITIONAL LANGUAGE:                                                                                                  
     A school  district may not receive  state education aid                                                                    
     for K-12  support appropriated  under this  section and                                                                    
     distributed by  the Department  of Education  and Early                                                                    
     Development under  AS 14.17 if the  school district (1)                                                                    
     has  a  policy refusing  to  allow  recruiters for  any                                                                    
     branch   of  the   United   States  military,   Reserve                                                                    
     Officers' Training Corps,  Central Intelligence Agency,                                                                    
     or Federal Bureau of  Investigation to contact students                                                                    
     on  a  school  campus  if the  school  district  allows                                                                    
     college, vocational school, or  other job recruiters on                                                                    
     a campus to contact students;  (2) refuses to allow the                                                                    
     Boy  Scouts of  America  to use  school facilities  for                                                                    
     meetings or  contact with students if  the school makes                                                                    
     the facility  available to  other non-school  groups in                                                                    
     the community; or (3) has  a policy of refusing to have                                                                    
     an in  school Reserve Officers' Training  Corps program                                                                    
     or a Junior Reserve Officers' Training Corps program.                                                                      
     EXPLANATION:  Support  our   troops  and  the  agencies                                                                    
     critical to the security of our country.                                                                                   
                                                                                                                                
Vice-Chair   Fairclough   OBJECTED   for  the   purpose   of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Co-Chair Kelly  noted that  this increment  had been  in the                                                                    
budget  for some  time and  inquired how  many years  it had                                                                    
been included. Mr. Armstrong replied  that the increment had                                                                    
probably been in the budget for eight or nine years.                                                                            
                                                                                                                                
Co-Chair Kelly  stated that  Amendment 6  sent a  message to                                                                    
the school districts that the  state was not in the business                                                                    
of  keeping  military  recruiters  and  boy  scouts  out  of                                                                    
schools.  He  observed  that the  amendment's  language  was                                                                    
self-exclamatory and was "good" language.                                                                                       
                                                                                                                                
Vice-Chair  Fairclough WITHDREW  her OBJECTION.  There being                                                                    
NO further OBJECTION, Amendment 6 was ADOPTED.                                                                                  
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 7.                                                                                      
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 7                                                                                         
                                                                                                                                
     OFFERED BY: Senator Meyer                                                                                                  
     DEPARTMENT: Commerce, Community  & Economic Development                                                                    
     APPROPRIATION:   Alaska  Seafood   Marketing  Institute                                                                    
     ALLOCATION: Alaska Seafood Marketing Institute                                                                             
                                                                                                                                
     LANGUAGE:                                                                                                                  
     Amend section 12(h)(3), page 59, lines 15-17, to read:                                                                     
                                                                                                                                
     (3)  the  sum  of   $7,772,200  [$7,286,400]  from  the                                                                    
     general  fund, for  the  purpose  of matching  industry                                                                    
     contributions   collected   by   the   Alaska   Seafood                                                                    
     Marketing Institute for the fiscal year ending June                                                                        
     30, 2012;                                                                                                                  
                                                                                                                                
     EXPLANATION: This amendment  adds $485,800 Unrestricted                                                                    
     General  Fund  Receipts  (UGF) to  the  Alaska  Seafood                                                                    
     Marketing  Institute's   appropriation,  restoring  the                                                                    
     FY14 Governor's Request for UGF.                                                                                           
                                                                                                                                
Vice-Chair   Fairclough   OBJECTED   for  the   purpose   of                                                                    
discussion.                                                                                                                     
                                                                                                                                
Co-Chair Meyer  stated that  Amendment 7  clarified language                                                                    
and that  the change would  be better explained  by Co-Chair                                                                    
Kelly's staff.                                                                                                                  
                                                                                                                                
9:33:34 AM                                                                                                                    
                                                                                                                                
Mr. Armstrong  related that in  the other body,  the tourism                                                                    
marketing  funding  had  been cut  from  the  Department  of                                                                    
Commerce,  Community  and   Economic  Development's  (DCCED)                                                                    
budget from $16  million to $15 million. He  stated that the                                                                    
joint  House  and  Senate  Finance   Committee  had  made  a                                                                    
conforming  reduction   to  the  Alaska   Seafood  Marketing                                                                    
Institute  (ASMI), which  was  also  within DCCED's  budget;                                                                    
ASMI's funding had been reduced  by one-sixteenth, which was                                                                    
$485,800. He  stated that when  HB 65  had come over  to the                                                                    
Senate, the  Senate Labor  and Commerce  Subcommittee, which                                                                    
was chaired  by Senator Meyer,  had requested that  the ASMI                                                                    
funding be  restored; the amendment conformed  to the wishes                                                                    
of the subcommittee.                                                                                                            
                                                                                                                                
Co-Chair Meyer noted that Mr.  Armstrong had done a good job                                                                    
expressing  the intent  of the  committee to  keep ASMI  and                                                                    
tourism  marketing   at  the  governor's   proposed  funding                                                                    
levels.                                                                                                                         
                                                                                                                                
Vice-Chair  Fairclough WITHDREW  her OBJECTION.  There being                                                                    
NO further OBJECTION, Amendment 7 was ADOPTED.                                                                                  
                                                                                                                                
9:34:50 AM                                                                                                                    
                                                                                                                                
Senator Bishop MOVED to ADOPT Amendment 8.                                                                                      
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 8                                                                                         
                                                                                                                                
     OFFERED BY: Senator Olson                                                                                                  
                                                                                                                                
     DEPARTMENT: Commerce, Community & Economic Development                                                                     
     APPROPRIATION: Community and Regional Affairs                                                                              
     ALLOCATION: Community and Regional Affairs                                                                                 
                                                                                                                                
     ADD: $400,000, general funds, fund code 1004                                                                               
                                                                                                                                
     EXPLANATION:   Add  back   the   operating  funds   for                                                                    
     Ilisagvik  College. These  funds were  removed so  they                                                                    
     could   be  requested   through  the   capital  budget.                                                                    
     However, they are not capital  in nature. These are the                                                                    
     regular,  ongoing,  operating  funds that  the  College                                                                    
     relies  on to  run its  programs, similar  to what  the                                                                    
     operating  budget funds  for  K-12  and the  University                                                                    
     system. Because they are not  a part of the University,                                                                    
     they must go through the Department for their funding.                                                                     
                                                                                                                                
Co-Chair Kelly OBJECTED for the purpose of discussion.                                                                          
                                                                                                                                
Senator Bishop  related that Amendment 8  contained language                                                                    
that added back funds to  Ilisagvik College; these funds had                                                                    
been removed,  so that they  could be requested  through the                                                                    
capital budget. He  related that the funds  were not capital                                                                    
in nature, but were day-to-day  operating funds to help with                                                                    
the   college's  career   and   technical  education   (CTE)                                                                    
programs. He  recalled that he had  toured Ilisagvik College                                                                    
eight times and that it  performed a good service. He stated                                                                    
that with the increase  in offshore, outer continental shelf                                                                    
(OCS)  work, the  college was  doing a  lot more  "with that                                                                    
program." He  concluded that adding  the $400,000  back into                                                                    
the  CTE programs  at Ilisagvik  College would  help further                                                                    
train Alaskan's for jobs on land and offshore.                                                                                  
                                                                                                                                
Co-Chair Kelly  clarified that the  original amount  for the                                                                    
Ilisagvik College  was $600,000. He  stated that it  was not                                                                    
Senator Olson's intent to cut  $200,000, but that the intent                                                                    
was to  transfer $200,000  to the  capital budget.  He added                                                                    
that  there needed  to be  discussion in  the future  on the                                                                    
issue, but  that Senator Olson  had talked to  the committee                                                                    
and  expected full  funding. He  added  that he  had made  a                                                                    
commitment to Senator Olson that  he would work to make sure                                                                    
the  other   $200,000  was   picked  up   during  Conference                                                                    
Committee or "somewhere else."                                                                                                  
                                                                                                                                
Co-Chair  Kelly  WITHDREW  his  OBJECTION.  There  being  NO                                                                    
further OBJECTION, Amendment 8 was ADOPTED.                                                                                     
                                                                                                                                
9:36:52 AM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough MOVED to ADOPT Amendment 9.                                                                               
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 9                                                                                         
                                                                                                                                
     OFFERED BY: Senator Fairclough                                                                                             
     DEPARTMENT: Commerce, Community  & Economic Development                                                                    
     APPROPRIATION:   Alcoholic   Beverage   Control   Board                                                                    
     ALLOCATION: Alcoholic Beverage Control Board                                                                               
                                                                                                                                
     ADD: $189,500, General Fund/Program Receipts, (1005)                                                                       
                                                                                                                                
     EXPLANATION:  This  amendment   adds  $189,500  General                                                                    
     Fund/Program   Receipts  to   the  Alcoholic   Beverage                                                                    
     Control    Board   allocation    to   meet    allocated                                                                    
     administrative   support   costs  ($127,000)   and   to                                                                    
     maintain Department of  Law legal assistance ($62,500),                                                                    
     restoring the FY14 Governor's Request.                                                                                     
                                                                                                                                
Co-Chair Kelly OBJECTED for the purpose of discussion.                                                                          
                                                                                                                                
Vice-Chair  Fairclough related  that a  previous legislature                                                                    
had moved  the Alcoholic  Beverage Control (ABC)  Board from                                                                    
the Department of Public Safety  to the DCCED. She explained                                                                    
that during the  budget process, the funding  did not follow                                                                    
the  positions and  that Amendment  9 would  reestablish the                                                                    
$189,500 in general funds and program receipts.                                                                                 
                                                                                                                                
Co-Chair  Meyer stated  that funding  had been  removed from                                                                    
the DCCED's budget  because the intent was  that the funding                                                                    
would  follow  the ABC  Board  when  it was  transferred  to                                                                    
DCCED;  however,  "for  some reason"  the  funding  did  not                                                                    
follow  the ABC  Board. He  related that  the amendment  was                                                                    
acceptable  because it  would  still  be a  "conferenceable"                                                                    
item.                                                                                                                           
                                                                                                                                
Co-Chair Kelly WITHDREW his OBJECTION.                                                                                          
                                                                                                                                
Senator  Hoffman  pointed  out a  technical  correction  and                                                                    
opined that the comma after  the $189,500 should be a period                                                                    
instead.                                                                                                                        
                                                                                                                                
There being NO further OBJECTION, Amendment 9 was ADOPTED.                                                                      
                                                                                                                                
9:38:28 AM                                                                                                                    
                                                                                                                                
Vice-Chair Fairclough MOVED to ADOPT Amendment 10.                                                                              
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 10                                                                                        
                                                                                                                                
     OFFERED BY: Senator Fairclough                                                                                             
                                                                                                                                
     DEPARTMENT:    Education    and    Early    Development                                                                    
     APPROPRIATION:    Teaching    and   Learning    Support                                                                    
     ALLOCATION: Early Learning Coordination                                                                                    
                                                                                                                                
     ADD: $37,500 General Fund (l004)                                                                                           
                                                                                                                                
     EXPLANATION:  This amendment  restores  $37,500 to  the                                                                    
     Best Beginnings  program. Best  Beginnings is  a public                                                                    
     private partnership  that works  to ensure  children in                                                                    
     Alaska  begin  school  ready to  learn  in  communities                                                                    
     statewide.                                                                                                                 
                                                                                                                                
Co-Chair Kelly OBJECTED for the purpose of discussion.                                                                          
                                                                                                                                
Vice-Chair  Fairclough  indicated  that  during  the  public                                                                    
testimony,   Best   Beginnings  had   received   significant                                                                    
support.  She  stated  that there  had  been  comments  that                                                                    
20,000  books per  month were  being  delivered to  children                                                                    
across Alaska.  She offered that  the money would  serve the                                                                    
program well  and that it  required very  little management;                                                                    
she urged the committee's support.                                                                                              
                                                                                                                                
Co-Chair  Kelly  WITHDREW  his  OBJECTION.  There  being  NO                                                                    
further OBJECTION, Amendment 10 was ADOPTED.                                                                                    
                                                                                                                                
Vice-Chair  Fairclough   requested  that  Amendment   11  be                                                                    
distributed to committee members.                                                                                               
                                                                                                                                
Co-Chair Kelly  related that  Amendment 11  was a  result of                                                                    
public  testimony.   He  stated   that  during   the  public                                                                    
testimony,   funding  for   the   Southeast  Region's   fish                                                                    
management, Best  Beginnings, and  AVTEC had  been testified                                                                    
for fairly consistently.                                                                                                        
                                                                                                                                
Vice-Chair Fairclough MOVED to ADOPT Amendment 11.                                                                              
                                                                                                                                
     FY 14 OPERATING BUDGET AMENDMENT 11                                                                                        
                                                                                                                                
     OFFERED BY: Senators Fairclough and Bishop                                                                                 
                                                                                                                                
     DEPARTMENT:   Department   of   Labor   and   Workforce                                                                    
     Development                                                                                                                
     APPROPRIATION: Alaska Vocational Technical Center                                                                          
     ALLOCATION: Alaska Vocational Technical Center                                                                             
                                                                                                                                
     ADD: $200,000 GF (1004) Inc OTI                                                                                            
                                                                                                                                
     EXPLANATION: This increment gives A VTEC $200,000 for                                                                      
     increased program costs                                                                                                    
                                                                                                                                
Co-Chair Kelly OBJECTED for the purpose of discussion.                                                                          
                                                                                                                                
Vice-Chair  Fairclough stated  that she  had visited  AVTEC,                                                                    
which was  requesting $200,000. She  related that  there had                                                                    
been testimony in  support of AVTEC's programs  and that the                                                                    
funding would enable AVTEC to  not increase its tuition. She                                                                    
concluded that it was her  intent that Amendment 11 would be                                                                    
a  one-time   increment  (OTI),   but  that   the  amendment                                                                    
represented  an opportunity  to  stave off  the increase  in                                                                    
tuition for one more year.                                                                                                      
                                                                                                                                
Senator Bishop  concurred with Vice-Chair Fairclough  in her                                                                    
analogy and explanation of Amendment 11.                                                                                        
                                                                                                                                
Co-Chair  Meyer  inquired  if   Amendment  11  was  one-time                                                                    
increment.                                                                                                                      
                                                                                                                                
9:40:55 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:41:57 AM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  Meyer stated  there had  been confusion  regarding                                                                    
which amendments  were before the  committee and  which ones                                                                    
would be the  "amendments of record." He  related that Vice-                                                                    
Chair Fairclough had the correct amendment.                                                                                     
                                                                                                                                
Vice-Chair Fairclough stated that  the public was handed the                                                                    
proper amendment,  which was for  $200,000 in  General funds                                                                    
as an  OTI; the  increment gave  AVTEC $200,000  for program                                                                    
costs.                                                                                                                          
                                                                                                                                
Co-Chair  Meyer  WITHDREW  his  OBJECTION.  There  being  NO                                                                    
further OBJECTION, Amendment 11 was ADOPTED.                                                                                    
                                                                                                                                
Mr. Armstrong reminded the  committee of conforming language                                                                    
that needed to be read before the committee recessed.                                                                           
                                                                                                                                
Co-Chair  Kelly   requested  Co-Chair  Meyer  to   read  the                                                                    
conforming language section.                                                                                                    
                                                                                                                                
Co-Chair  Meyer  MOVED  to direct  the  Legislative  Finance                                                                    
Division  and the  Legislative Legal  Division  to make  any                                                                    
appropriate, conforming,  or technical changes to  HB 65 and                                                                    
HB 66. There being NO OBJECTION, it was so ordered.                                                                             
                                                                                                                                
Co-Chair Kelly  thanked the committee  for its hard  work on                                                                    
the  operating  budget. He  related  that  the Senators  had                                                                    
worked with each other and the  public in order to make sure                                                                    
that the bill  before the committee was about as  "good of a                                                                    
bill" that  the state  could afford. He  shared that  he had                                                                    
nine years  of experience  on the  House and  Senate Finance                                                                    
Committee's  and that  he  had never  worked  with a  better                                                                    
group of  people. He added  that the current  Senate Finance                                                                    
Committee was  the best Finance  Committee that he  had ever                                                                    
seen. He relayed that the  subcommittee work, in particular,                                                                    
was excellent, clear, and had good justifications.                                                                              
                                                                                                                                
9:44:51 AM                                                                                                                    
RECESSED                                                                                                                        
                                                                                                                                
4:22:57 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
4:23:06 PM                                                                                                                    
                                                                                                                                
Co-Chair  Kelly stated  that the  committee had  amended the                                                                    
operating budget  earlier in the  day and that  the polished                                                                    
committee  substitute was  before the  committee. He  stated                                                                    
that a  lot of people  had assisted with the  formulation of                                                                    
the budget and  relayed thanks to members  of the committee,                                                                    
their  staff,  and  the  Legislative  Finance  Division.  He                                                                    
discussed the magnitude of the  work that the administration                                                                    
had  done on  the  operating budget  before  it reached  the                                                                    
legislature and  thanked Karen Rehfeld,  the administration,                                                                    
and  Governor Parnell.  He expressed  thanks  to the  Senate                                                                    
Finance Committee staff, the drafter  of the legislation, as                                                                    
well as  the committee's  "counterparts in the  other body."                                                                    
He  stated  that  the  work  could be  hectic  in  a  90-day                                                                    
session.                                                                                                                        
                                                                                                                                
Co-Chair  Meyer  MOVED  to  ADOPT   SCS  CSHB  65(FIN)  (28-                                                                    
GH1799\G) as amended  as a working document.  There being NO                                                                    
OBJECTION, SCS CSHB 65(FIN) was ADOPTED.                                                                                        
                                                                                                                                
4:26:33 PM                                                                                                                    
                                                                                                                                
Co-Chair  Meyer  MOVED  to  ADOPT   SCS  CSHB  66(FIN)  (28-                                                                    
GH1797\Y) as amended  as a working document.  There being NO                                                                    
OBJECTION, SCS CSHB 66(FIN) was ADOPTED.                                                                                        
                                                                                                                                
Mr. Armstrong  related that there were  three documents from                                                                    
the  Legislative Finance  Division that  could walk  members                                                                    
through the bill. He stated  that the documents were labeled                                                                    
1,  2,  and  3.  Document  1  represented  the  numbers  and                                                                    
language section and detailed all  the funds that were spent                                                                    
in current version of the  two operating budgets. Document 2                                                                    
showed  how the  funds were  dispersed throughout  agencies.                                                                    
Document 3 was  the same as document 1,  but only identified                                                                    
the  general  fund  spending.  He   stated  that  all  three                                                                    
documents  were   on  the  Legislative   Finance  Division's                                                                    
website.  He  shared  that the  Senate  Finance  Committee's                                                                    
version  of the  operating  budget  spent $5,809,202,500  in                                                                    
unrestricted  general  funds,   $748,674,100  in  designated                                                                    
general  funds, $1,282,770,100  of  other  state funds,  and                                                                    
$2,033,674,100  in federal  receipts; the  total budget  was                                                                    
$9,874,320,800.                                                                                                                 
                                                                                                                                
Co-Chair  Kelly  stated  that  the  difference  between  the                                                                    
Senate numbers  for the operating budget  and the governor's                                                                    
numbers  was  $61  million  and that  $36  million  of  that                                                                    
funding was receipt authority.                                                                                                  
                                                                                                                                
Co-Chair Kelly inquired what the  total reduction in general                                                                    
funds was. Mr.  Armstrong replied that if one  took away the                                                                    
"hollow"  university  receipts,  the reduction  was  roughly                                                                    
$25,000,878.                                                                                                                    
                                                                                                                                
Co-Chair  Meyer MOVED  to  REPORT SCS  CSHB  65(FIN) out  of                                                                    
committee  with individual  recommendations. There  being NO                                                                    
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
4:29:50 PM                                                                                                                    
                                                                                                                                
SCS CSHB  65(FIN) was REPORTED  out of committee with  a "do                                                                    
pass" recommendation.                                                                                                           
                                                                                                                                
Co-Chair Meyer MOVED to REPORT SCS CSHB 66(FIN) out of                                                                          
committee with individual recommendations. There being NO                                                                       
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
4:30:09 PM                                                                                                                    
                                                                                                                                
SCS CSHB 66(FIN) was REPORTED out of committee with a "do                                                                       
pass" recommendation.                                                                                                           
                                                                                                                                
Co-Chair Kelly inquired if the conforming language was in                                                                       
the committee substitute for HB 65 and HB 66. Mr. Armstrong                                                                     
replied that he believed it was.                                                                                                
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
4:30:43 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 4:30 p.m.                                                                                          

Document Name Date/Time Subjects
FY14 SFIN Operating Budget Amendments 1.pdf SFIN 3/26/2013 9:00:00 AM
HB 65
HB 65 work draft version G.pdf SFIN 3/26/2013 9:00:00 AM
SB 65
HB 66 work draft version Y.pdf SFIN 3/26/2013 9:00:00 AM
HB 66