Legislature(2013 - 2014)SENATE FINANCE 532
04/08/2013 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB77 | |
| SB74 | |
| SB85 | |
| SB95 | |
| SB96 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 85 | TELECONFERENCED | |
| + | SB 95 | TELECONFERENCED | |
| + | SB 96 | TELECONFERENCED | |
| = | SB 74 | ||
| = | HB 77 | ||
SENATE FINANCE COMMITTEE
April 8, 2013
9:06 a.m.
9:06:46 AM
CALL TO ORDER
Co-Chair Meyer called the Senate Finance Committee meeting
to order at 9:06 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
Christine Marasigan, Staff, Senator Kevin Meyer; Ed Fogels,
Deputy Commissioner, Department of Natural Resources;
Heather Shattuck, Staff, Senator Pete Kelly; Brittany
Hutchison, Staff, Senator Click Bishop; Curtis Thayer,
Deputy Commissioner, Department of Administration (DOA);
Nicki Neal, Director, Division of Personnel and Labor
Relations, Department of Administration; Senator Peter
Micciche; Larry Semmens.
PRESENT VIA TELECONFERENCE
Jim Dodson, President, Fairbanks Economic Development,
Fairbanks.
SUMMARY
SB 74 UNIVERSITY OF ALASKA BUILDING FUND
SB 74 was REPORTED out of committee with a "do
pass" recommendation and with new zero fiscal
notes from the University of Alaska, Department
of Administration, and Department of Revenue.
CS SB 85 (TRA)EXPERIMENTAL VEHICLE PLATES
CS SB 85 (TRA) was REPORTED out of committee with
a "do pass" recommendation and with previously
published zero fiscal note: FN1 (ADM).
CS SB 95 STATE EMPLOYEE COMPENSATION AND BENEFITS
CS SB 95 was REPORTED out of committee with a "do
pass" recommendation and with a new fiscal impact
note from the Legislature; new fiscal impact note
from the Court System; and previously published
fiscal impact note: FN1 (GOV).
SB 96 OIL AND GAS AND GAS ONLY LEASES
SB 96 was HEARD and HELD in committee for further
consideration.
SCS CS HB 77(FIN)
LAND USE/DISP/EXCHANGES; WATER RIGHTS
SCS CS HB 77(FIN) was REPORTED out of committee
with a "do pass" recommendation and a new zero
fiscal note from Department of Natural Resources,
and previously published zero fiscal note: FN2
(DFG).
CS FOR HOUSE BILL NO. 77(RES)
"An Act relating to the Alaska Land Act, including
certain authorizations, contracts, leases, permits, or
other disposals of state land, resources, property, or
interests; relating to authorization for the use of
state land by general permit; relating to exchange of
state land; relating to procedures for certain
administrative appeals and requests for
reconsideration to the commissioner of natural
resources; relating to the Alaska Water Use Act; and
providing for an effective date."
9:08:19 AM
Co-Chair Meyer noted letters in the committee member's
packet from various corporations, support letters, and
paperwork related to the bill.
9:08:54 AM
Co-Chair Kelly MOVED to ADOPT the proposed committee
substitute for SCS CS HB 77 (FIN), Work Draft 28-GH1524\P
(Bullock 4/7/13).
Co-Chair Meyer OBJECTED for purpose of discussion.
9:09:57 AM
CHRISTINE MARASIGAN, STAFF, SENATOR KEVIN MEYER, noted the
title change on the first page of the CS, which pertained
to material stated on page 18, section 30. The section
allowed for the performance of a feasibility study at
Chikuminuk Lake. Language pertaining to the same subject
was found on page 6 in the transition language. She
mentioned 2 additional substantive changes to the bill, the
first on page 6, section 4 addressed leases. The final
change on page 23, section 47 addressed language related to
transition, pending applications.
9:11:43 AM
Co-Chair Meyer noted that the change in access to the Wood-
Tikchik State Park was previously included in Senator
McGuire's bill, which was the reason for the title change.
He stated that long-term lease sales allowed first
purchasing opportunity to the lessee. Ms. Marasigan
concurred.
9:12:55 AM
Co-Chair Meyer understood that transition language in the
bill required correction in collaboration with the
Department of Natural Resources (DNR). Ms. Marasigan
replied that there had been some discussion regarding
Section 4 pertaining to preference rites.
9:13:17 AM
Ms. Marasigan pointed out that the transition language at
the end of the bill should result in a zero fiscal note.
She stated that DNR representatives were available to
discuss the fiscal note.
9:14:08 AM
Senator Olson objected that the finance CS was considerably
different from the original and he hoped for ample time for
committee consideration.
Co-Chair Meyer explained that the bill's changes were minor
and he did not feel the need to hold the bill.
Senator Olson remarked that the citizens affected by the
changes in the bill did not consider the issues minor.
9:15:08 AM
Co-Chair Kelly queried the page number for Tikchick State
Park and Chikuminuk Lake.
Ms. Marasigan replied that the title change was noted on
page one. Another change noted on page 18, section 30
addressed Chikuminuk Lake. She continued that page 23 had
transition language which also addressed Chikuminuk Lake.
9:15:59 AM
Co-Chair Kelly remarked that the CS would not grant access
to the park, but rather enable a feasibility study.
Co-Chair Meyer agreed, but remarked that funding was
acquired in the FY 13 capital budget for a hydro project,
but access to the park was necessary to perform the
feasibility study.
9:16:46 AM
Co-Chair Kelly reiterated that access would be granted for
the feasibility study alone.
9:17:01 AM
Vice-Chair Fairclough looked at page 6, and noted that
Section 4 was new.
Ms. Marasigan replied that the section was new and related
to preference rights to purchaser lease without competitive
bid for up to five acres of state land. She pointed out
that the change added time for an applicant to purchase the
lease land. The federal permit requirement was also
removed.
9:18:08 AM
Senator Hoffman noted that section 40 from the previous
version was now listed as section 42.
Ms. Marasigan replied that the bill remained the same minus
the three discussed changes.
9:18:42 AM
Co-Chair Meyer addressed Senator Olson's concerns. He
understood that any time bills were combined, public input
was minimized. He noted that the process of combining bills
was expected at the end of a legislative session. He
believed that the bill's impact was similar and that
testimony for HB 77 would remain consistent. He judged the
CS as an appropriate vehicle for the changes.
9:19:31 AM
Senator Olson felt that the bill was deemed controversial
prior to the introduction of the Senate Finance Committee
version. He opined that the judgment of the chairman was
clouded by end-of-session pressure. He suggested holding
the bill in committee for further work in a subcommittee or
special session. He requested testimony from DNR and the
Water Resources Board.
9:20:44 AM
Co-Chair Meyer shared that DNR was available to discuss the
changes. He opined that HB 77 was well vetted between the
two bodies.
Senator Olson felt that the CS was much different than the
version passed to the committee.
Co-Chair Meyer agreed that changes were made, which was
common practice at the end of session.
9:21:20 AM
Senator Olson suggested that bad legislation was often
passed when time was short and legislators were rushed.
9:21:25 AM
AT EASE
9:24:23 AM
RECONVENED
9:24:33 AM
Senator Bishop pointed to Section 4 and requested
clarification from the department.
9:24:54 AM
ED FOGELS, DEPUTY COMMISSIONER, DEPARTMENT OF NATURAL
RESOURCES, introduced himself.
9:25:37 AM
Senator Bishop noted that section 4 stated that "a director
shall grant a preference to right-to-purchase or lease
without competitive bid up to 5 acres...who has erected a
building on the land and use the land for a bona fide
business purposes." He asked if the section would apply to
traditional fish camps on the Yukon River.
Mr. Fogels replied that the intent of the preference was to
provide Alaskans with federal permits on federal land. The
permits allowed Alaskans the opportunity to purchase the
land.
9:26:32 AM
Senator Bishop asked if an Alaskan with a fish camp could
apply for the preference to purchase or lease federal land.
Mr. Fogels pointed out that the amendment stated that an
Alaskan with a state permit or lease who met the
requirements of 10 years and 25 percent would have the
option to purchase the property.
9:27:26 AM
Co-Chair Meyer clarified that the proposed amendment would
not be addressed until the CS was adopted.
9:27:42 AM
Co-Chair Kelly remarked that the changes in the CS were not
significant and were present to protect Alaskans. He did
not think that the subject of a feasibility study was
especially controversial.
9:29:13 AM
Co-Chair Meyer remarked that combining the bills seemed
logical. He noted that access to the park also seemed
logical since the money for the project was appropriated in
the FY 13 capital budget.
Co-Chair Kelly furthered that there were two separate
pieces that the feasibility study could be applied to and
the most applicable option was propagated in the CS.
9:30:09 AM
Co-Chair Kelly restated his original motion, and MOVED to
ADOPT the proposed committee substitute for SCS CS HB 77
(FIN), Work Draft 28-GH1524\P (Bullock 4/7/13).
Senator Olson OBJECTED for discussion.
Senator Olson wondered if Mr. Fogels would explain the
forthcoming amendment upon proposal.
Co-Chair Meyer replied in the affirmative.
9:30:36 AM
Senator Olson removed his objection. There being NO
OBJECTION it was so ordered. Version P was adopted.
9:31:29 AM
AT EASE
9:32:04 AM
RECONVENED
9:32:08 AM
Co-Chair Kelly moved Amendment 1.
DELETE Sec.4
Create a new preference right under AS 38.05.035
(o) Where there is an active municipal entitlement
selection on state land under AS 29.65.010 - 29.65.030
that has a state issued lease and before the decision
to approve the municipal entitlement, the director
shall grant a preference right to purchase without
competitive bid of up to five acres of the state land
to an individual who has erected a building approved
by a lease on the state land and used the land for
bona fide business purposes for 10 or more years under
a state lease, if the business produced no less than
25 percent of the total income of the applicant for
the 10 years preceding the application to purchase the
land. The director shall sell the land at a price
determined by the director to represent the current
fair market value of the unimproved land determined by
appraisal and survey, if not already completed, at the
cost of the applicant. If the director determines in a
written finding that the purchase of the land would
interfere with public use by residents of the area,
the director may condition the purchase to mitigate
the adverse effects on the public or may reject the
application if those effects can not be mitigated. The
revenue from the purchase of the parcel will be given
to the municipality if the municipal entitlement is
approved for that acreage. In this subsection,
"business purposes" means a purpose consistent with
the classification of the land at the time the land
was entered. In this subsection, "building" means a
permanent type of structure with solid walls,
foundation, and roof.
Co-Chair Meyer OBJECTED for discussion.
9:32:27 AM
Ms. Marasigan explained that Amendment 1 deleted Section 4,
and created a new preference right under AS 38.05.035. She
invited the department to discuss the amendment.
9:33:00 AM
Mr. Fogels explained that DNR observed problems with
Section 4 as stated in the finance version. The first issue
was that the CS deleted a preference right deemed necessary
to the department. He proposed focus on the preference
right allowing a leaseholder the option of purchasing that
lease.
Co-Chair Meyer wondered if the department's testimony
addressed Senator Bishop's concerns.
9:33:53 AM
Senator Bishop clarified that a leaseholder could apply for
the lease if the land would revert to a municipality.
Mr. Fogels responded that the option would exist for the
lease holder when the land was given to the municipality
through the municipal entitlements program.
9:34:14 AM
Vice-Chair Fairclough queried the impact of the five years
versus ten years and how the time frame either hurt or
helped an individual or municipality. Mr. Fogels responded
that the intent of the extended time period ensured that a
person invested more in their piece of land indicating
seriousness about their presence. He stated that the
department's leases were typically for commercial purposes.
The provision showed that a commercial lease was viable and
that 25 percent of income was derived from the commercial
venture.
9:35:10 AM
Vice-Chair Fairclough wondered if there was a particular
title holder that would be adversely affected by the
legislation.
Mr. Fogels did not know.
Senator Hoffman wondered how the amendment would be viewed
in light of individuals with long-term fish camp sites on
the Yukon River. Mr. Fogels responded that the preference
right was only for state leases. If the person with the
fish camp had a state lease then they would qualify,
otherwise the provision would not apply.
9:36:18 AM
Senator Olson felt that there was no protection for
Alaskans with long-term fish racks if they did not have
leases.
Mr. Fogels responded that a person holding a fish camp with
a state lease was able to purchase the land. He added that
many of the fish camps were on private land, which would
not be affected.
9:37:11 AM
Senator Olson wondered about the Water Resources Board as
established under Alaska statute.
Mr. Fogels responded that the Water Resources Board was
dormant without funding or membership.
Senator Olson found the information troublesome.
9:37:57 AM
Co-Chair Meyer removed his objection. There being NO
OBJECTION, Amendment 1 was ADOPTED.
9:38:26 AM
Co-Chair Meyer asked about fiscal note changes.
Ms. Marasigan responded that a forthcoming new
indeterminate fiscal note would be attached to the bill.
She asked the department to address the fiscal note.
9:38:52 AM
Mr. Fogels responded that the changes to the bill were
without fiscal impact.
Co-Chair Meyer concurred. He understood that both fiscal
notes were without fiscal impact.
9:39:20 AM
Co-Chair Kelly MOVED to REPORT SCS CS HB 77 (FIN) as
amended out of committee with individual recommendations
and the accompanying fiscal notes. There being NO
OBJECTION, it was so ordered.
Co-Chair Meyer stated that a separate title change
resolution would accompany the bill.
9:41:00 AM
AT EASE
9:41:24 AM
RECONVENED
9:41:30 AM
Co-Chair Kelly REMOVED his PREVIOUS MOTION, for the purpose
of correcting the motion. There being NO OBJECTION, it was
so ordered.
9:41:47 AM
Co-Chair Meyer MOVED to REPORT SCS CS HB 77 (FIN) as
amended out of committee with individual recommendations,
attached SCR Title Change, the accompanying fiscal notes.
There being NO OBJECTION, it was so ordered.
SCS CS HB 77(FIN) was REPORTED out of committee with a "do
pass" recommendation and a new zero fiscal note from
Department of Natural Resources, and previously published
zero fiscal note: FN2 (DFG).
9:42:51 AM
Senator Hoffman stressed grave concern about testimony
regarding section 42. He intended to allow the bill to move
from committee, but would sign the report "amend."
9:43:37 AM
AT EASE
9:46:08 AM
RECONVENED
SENATE BILL NO. 74
"An Act creating the University of Alaska building
fund for the payment by the University of Alaska of
the costs of use, management, operation, maintenance,
and depreciation of space in buildings; and
authorizing the Board of Regents of the University of
Alaska to designate buildings for which the fund is to
be used."
9:46:33 AM
Co-Chair Kelly inquired about the dedicated fund.
HEATHER SHATTUCK, STAFF, SENATOR PETE KELLY, related that a
memo from Legal Services was in members' packets. The memo
stated that the bill did not create a dedicated fund.
9:47:49 AM
AT EASE
9:48:52 AM
RECONVENED
Vice-Chair Fairclough queried the upper limit of bonding
authority for the university. The discussion arose
regarding the engineering buildings. She noted that under
AS 14.40.253 regarding financing notice and approval, the
university must return to the legislature to communicate
their debts, reasons and anticipated annual payments.
9:49:59 AM
Vice-Chair Fairclough supported the bill, but wondered how
the building fund would be capitalized. She reminded
committee members that the capital budget language section
suggested that a building be given to the university. She
wondered whether the intention was for seed money for the
building fund.
9:51:29 AM
Co-Chair Kelly MOVED to REPORT SB 74 out of committee with
individual recommendations and the accompanying fiscal
notes. There being NO OBJECTION, it was so ordered.
SB 74 was REPORTED out of committee with a "do pass"
recommendation and with new zero fiscal notes from the
University of Alaska, Department of Administration, and
Department of Revenue.
9:52:29 AM
AT EASE
9:54:25 AM
RECONVENED
SENATE BILL NO. 85
"An Act relating to experimental vehicles."
9:55:18 AM
BRITTANY HUTCHISON, STAFF, SENATOR CLICK BISHOP, explained
the difference between SB 85 and CS SB 85 (TRA). She noted
that the words "cold weather" on page one were removed to
allow Alaska to welcome all types of vehicle testing. She
stated that Alaska was marketed as a reliable location for
cold weather testing. Currently no statutes existed
regarding registration for experimental vehicles. She noted
that one company testing vehicles was stopped by troopers
and asked to register and title their vehicles, which was
not desirable or possible in Alaska. The Division of Motor
Vehicles (DMV) lacked statutory authority to register
experimental vehicles.
Ms. Hutchison continued that SB 85 would allow the DMV to
issue experimental plates to vehicle manufacturer
distributers for vehicle testing. The plate would be
valuable for a 12 month period and could be renewed up to
two times for a total of 36 months. Following completion of
the experiment, the vehicles must then be destroyed or
taken out of the state.
Co-Chair Meyer noted that multiple testifiers were
available online for questions. He appreciated the self-
explanatory nature of the bill. He OPENED public testimony.
9:58:02 AM
JIM DODSON, PRESIDENT, FAIRBANKS ECONOMIC DEVELOPMENT,
FAIRBANKS (via teleconference), testified in support of SB
85. He stated that Fairbanks Economic Development had
marketed to the cold-weather testing industry for 20 years.
He noted that the emerging industry was diversifying
Alaska's economy. He pointed out that the industry created
more than $500 million worth of economic activity along
with more than 300 jobs. He claimed that Alaska offered the
reliability, accessibility and affordability needed for the
industry. He noted that Alaska had the greatest opportunity
to advance its local economy.
Co-Chair Meyer CLOSED public testimony.
10:00:02 AM
Co-Chair Meyer pointed out the zero fiscal note. He was
happy for the opportunity to hear the bill in the Senate
Finance Committee.
10:00:28 AM
Co-Chair Kelly MOVED to REPORT CS SB 85 (TRA) out of
committee with individual recommendations and the
accompanying fiscal note.
CS SB 85 (TRA) was REPORTED out of committee with a "do
pass" recommendation and with previously published zero
fiscal note: FN1 (ADM).
10:01:01 AM
AT EASE
10:02:35 AM
RECONVENED
SENATE BILL NO. 95
"An Act relating to the compensation, allowances,
geographic differentials in pay, and leave of certain
public officials, officers, and employees not covered
by collective bargaining agreements; relating to
certain petroleum engineers and petroleum geologists
employed by the Department of Natural Resources;
relating to increased pay for certain partially exempt
employees of the state in specific circumstances;
making conforming amendments; and providing for an
effective date."
10:02:51 AM
Vice-Chair Fairclough MOVED to ADOPT the proposed committee
substitute for CS SB 95 (FIN), Work Draft 28-GS1101\U
(Wayne, 4/7/13).
Co-Chair Meyer OBJECTED for discussion.
10:04:01 AM
Ms. Marasigan noted that her office worked to create the
work draft before the committee. She requested that the
department provide a bill overview for the committee.
10:04:43 AM
CURTIS THAYER, DEPUTY COMMISSIONER, DEPARTMENT OF
ADMINISTRATION (DOA) introduced himself and the director of
labor relations, Nicki Neal. He noted two changes to the
bill. The first addressed section 20 and a change that did
not comply with current law. The change included salary
adjustments for certain exempt officers and employees of
the executive branch. He noted that the employees received
COLAs, but when the bill was drafted the option was omitted
for exempt employees. The second piece would allow judges
to receive the geographic differential language. He would
discuss the issue further in his overview of the bill.
10:06:01 AM
Co-Chair Meyer WITHDREW his OBJECTION. There being NO
OBJECTION, it was so ordered.
10:06:22 AM
Mr. Thayer presented the PowerPoint, "Alaska Department of
Administration, Overview of HB 195 and SB 95, State
Employee Condensation and Benefits" (copy on file).
Mr. Thayer began with slide 2: "What are HB 195 and SB 95
About?"
· Consistency with cost of living, reduction of leave
accrual, cap on leave amount and decreases in the pay
increment
· Enhance ability to recruit and retain highly-skilled
professionals
· Implementation of Geographical Pay Differential for
last phase of remaining employees
Mr. Thayer continued with slide 3: "Overview of the Bill
Sections."
· Section 1-4: Leave Accrual and Cap
· Section 5: Petroleum Engineers/Geologists
· Section 6-8: Cost of Living Increases
· Section 9: Pay Increments
· Section 10: Partially-Exempt Salaries
· Section 11-14: Geographic Pay Differentials
Mr. Thayer discussed slide 4, "New Leave Accrual and Cap."
He stated that the accrual rates were negotiated by the
General Government Employees Union and the confidential
employees to reduce leave accrual for new-hires beginning
July 1, 2013. The new accrual rating required 16 years of
service to receive 270 hours of leave. He mentioned the new
mandatory leave usage requiring an employee to use two
weeks of leave annually if they had less than 400 hours in
their leave balance. If an employee had greater than 400
hours of leave as of December 16th, they must use three
weeks of leave annually.
Mr. Thayer pointed out the new maximum accrual limit of
1000 hours for executive, judicial and legislative branch
employees. The department discovered, prior to drafting the
bill that without a cap the department faced a $164 million
liability in employee's leave. The top ten state employees
would cost the state $1.6 million at retirement. The
legislation would reduce the state's leave liability by
two-thirds.
10:09:22 AM
Vice-Chair Fairclough appreciated the administration's
efforts. She asked about the survey provided by the
McDowell Group. She wondered how the mandatory leave usage
compared to the average accrual for state employees.
Mr. Thayer explained that the study addressed the
geographic pay differential, which was located in a
different portion of the bill. The study established the
cost of living.
10:11:00 AM
Vice-Chair Fairclough wondered if the sick leave had been
rolled into paid time off.
Mr. Thayer responded that the state utilized Paid Time Off
(PTO), which encompassed all forms of leave.
10:12:20 AM
Vice-Chair Fairclough wondered about a study or survey
comparing sick leave with PTO for best practice.
10:12:36 AM
Nicki Neal, Director, Division of Personnel, Department of
Administration explained that a survey of that nature had
not been commissioned in Alaska. Prior to the 2013
collective bargaining, a survey of other states was
performed. The department received responses from
approximately 15 states that had annual and sick leave
programs. The responding states reported a cap of 450
hours.
10:13:08 AM
Vice-Chair Fairclough appreciated the compromises. She
wondered how robust the benefits provided by the state
were. She hoped that the administration would continue to
work with the union contractors to communicate the dynamics
facing the state. She asked about a comparison of leave
accrual among other states and the federal government.
10:14:56 AM
Ms. Neal was not sure about comparisons with the federal
government, but she offered to provide the information to
the committee. Regarding other states, Alaska compared
appropriately with leave accrual. She pointed out that the
other states had both annual and sick leave, whereas Alaska
had PTO.
10:15:12 AM
Mr. Thayer looked at slide 5, "Petroleum
Engineers/Geologists."
Section 5:
· Removes exclusion of in Division of Geological and
Geophysical Surveys (DGGS).
· Only 1 position - DGGS, Energy Section Manager
(currently SU Geologist V) - vacant since March 17,
2012.
o Position requires complete understanding of
petroleum systems analysis and exploration that
is obtained primarily through industry experience
o Industry salaries are approximately 50 percent
higher than current authorized salary (data from
Assoc of Petroleum Geologists 2011 Survey)
o Two national searches failed - No qualified
applicants after 45 days of recruitment and
advertising in national trade publications
· Amendment applicable to DNR, DGGS only
10:16:16 AM
Mr. Thayer discussed slide 6, "Cost of Living Increases."
Sections 6-8:
· Effective 7/1/13 - 1 percent
· Effective 7/1/14 - 1 percent
· Effective 7/1/15 - 2.5 percent
· Consistent with terms of recently negotiated
collective bargaining agreements
· Applies to noncovered classified and partially exempt
(PX) and many exempt employees of the executive
branch, employees of the legislature (AS 24.10.011),
and the judicial branch.
10:16:32 AM
Mr. Thayer highlighted slide 7, "Pay Increments."
Section 9:
· Effective 7/1/15 the percentage between pay increments
(J and above) will decrease from 3.75 percent to 3.25
percent
· Consistent with terms of recently negotiated
collective bargaining agreements
· Applies to noncovered classified and PX employees -
also applies to many exempt employees through policy
· Applies to legislative branch if a policy has been
adopted (AS 39.27.011(j))
10:17:06 AM
Mr. Thayer displayed slide 8, "Partially-Exempt Salaries."
Section 10:
· Partially Exempt (PX) positions are subject to
classification and pay plans which limits flexibility
· State often not competitive for top talent - need some
flexibility for mission critical positions
· Governor or designee on case-by-case basis:
o serves critical governmental interest of state
o employee possesses exceptional qualifications
o recruitment difficulties exist; or
o necessary to compete with labor market
· Applies to executive branch Partially Exempt (PX)
employees only
10:18:36 AM
Mr. Thayer discussed slide 9, "Geographical Pay
Differentials." He noted that sections 11-14 addressed the
survey conducted by McDowell Group in 2008 and completed in
2009. The study set the base at zero for Anchorage and
South Central Alaska. Based on the outcome of the survey,
Fairbanks would see a 3 percent pay differential, while
Juneau and Sitka would see 5 percent. Kodiak, Cordova and
Valdez would see 11 percent. Dillingham, Nome, and the
Roadless Interior would receive 37 percent. Barrow, Bethel,
Aleutians, and South West small communities would see 50
percent. Kotzebue, Unalaska/Dutch Harbor would receive 60
percent.
Mr. Thayer furthered that the change would affect the
executive branch with an increase for 483 employees, while
122 would see no loss in pay and 727 would see no change at
all. The legislative branch would have 154 employees with
an increase, 24 without a loss in pay, and 204 without
change. He noted that the study was performed every five
years depending on appropriations.
10:20:34 AM
Co-Chair Meyer looked at slide 9 and opined that the Tok
and Glennallen Regions would be more expensive than
Anchorage.
Mr. Thayer raised the same question initially, and was told
that the survey viewed the cost of living, housing,
utilities, food and transportation when making the
recommendations.
10:21:27 AM
Co-Chair Kelly wondered if the percent above the base was
considered in the retirement calculations.
Ms. Neal responded that a Tier One employee was considered,
otherwise a person must work 50 percent of time in the
location to receive the geographical pay differential on
retirement.
10:22:15 AM
Co-Chair Meyer wondered if the geographical pay
differentials were budgeted into the operating budget.
Co-Chair Kelly replied that the bill's cost was included in
the fiscal note.
Co-Chair Meyer CLOSED public testimony.
10:23:28 AM
Mr. Thayer discussed the fiscal notes, which were prepared
by the Office of Management and Budget (OMB) and would
implement changes in the first year of the contract, which
is when the geographic differential would take effect. In
FY 15 a decrease would be seen. The 2.5 percent increase
would be seen in FY 16.
Co-Chair Kelly wondered if the total amount of the
contracts was less than originally anticipated.
Mr. Thayer concurred. He explained that various union
negotiations altered the projected figures.
10:25:14 AM
Co-Chair Kelly opined that the fiscal note fit well within
the expectations.
10:25:49 AM
Co-Chair Meyer pointed out that the fiscal note would
change with the CS's inclusion of the courts.
Mr. Thayer stated that the court sought geographic
differential pay for 23 judges, which would affect the
fiscal note minimally.
Vice-Chair Fairclough addressed the fiscal notes
individually. She noted that the first fiscal note affected
OMB in FY 14 by $8,171,900, in FY 15 by $4,821,800 and FY
16 by $10,644,000. The bill related to compensations,
allowances, geographic differentials in pay and leave for
certain public officials, employees not covered by
collective bargaining and related to certain petroleum
engineers and geologists employed by the Department of
Natural Resources (DNR). Beginning in FY 14, salaries were
increased by 1 percent, same for FY 15, but an increase of
2.5 percent was anticipated for FY 16. The salary schedule
matched the recent negotiated agreement reached between the
state and the supervisory and general government units.
Vice-Chair Fairclough continued with the second fiscal note
for the Legislative Branch. In FY 14, $1,281,200, FY 15,
$410,400 and FY 16, $1,039,300 was stated. The final fiscal
note was for the Alaska Court System that would be amended
by the 23 judges as explained earlier. The third fiscal
note showed $741,900 for FY 14, $749,100 for FY 15 and
$1,890,900 for FY 16.
10:28:30 AM
Senator Hoffman remarked that legislators would not see pay
increases as a result of the legislation.
Co-Chair Meyer asked if the bill pertained to staff.
[Response was indecipherable]. He understood that the total
dollar amount was less than anticipated.
Co-Chair Kelly replied yes.
Co-Chair Meyer stated that the fiscal note was large, but
so was the number of employees. He appreciated the
negotiation process. He was unsure about whether the deal
was ratified.
Mr. Thayer replied that the supervisory unit was in the
process of ratification and expected the wrap up to occur
later in the month. The general services expected
ratification in the later part of May, due to the size of
their bargaining unit. He clarified that 23 judges would be
eligible for the geographical pay differential.
10:30:15 AM
Co-Chair Kelly MOVED to REPORT CS SB 95 (FIN) out of
committee with individual recommendations and the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
CS SB 95 (FIN) was REPORTED out of committee with a "do
pass" recommendation and with a new fiscal impact note from
the Legislature; new fiscal impact note from the Court
System; and previously published fiscal impact note: FN1
(GOV).
10:31:53 AM
AT EASE
10:32:09 AM
RECONVENED
SENATE BILL NO. 96
"An Act relating to the primary period of an oil and
gas or gas only lease and the extension of a lease;
relating to terms to be included in an oil and gas or
gas only lease; relating to rental for an oil and gas
or gas only lease; and providing for an effective
date."
10:32:45 AM
SENATOR PETER MICCICHE introduced SB 96. He explained that
SB 96 proposed changes to the oil and gas leasing statutes
to provide the commissioner of DNR with the ability to
grant a one-time extension to the primary term of an oil
and gas or gas-only lease, up to 10 years.
10:33:26 AM
LARRY SEMMENS, STAFF, SENATOR PETER MICCICHE introduced
himself. He provided a brief overview of the legislation.
He stated that the department and the industry supported
the bill. He pointed out that the bill had a zero fiscal
note with an indeterminate revenue impact. He explained
that the bill corrected an issue with short-term leases of
five to seven years. He mentioned situations where the
short-term leases should be extended to the normal ten-year
lease term. He mentioned that gas-only leases did not
expire as long as production occurred from the lease or
unitization of the lease.
Mr. Semmens continued that SB 96 provided the statutory
authorization to extend the lease if it was in the best
interest of the state to do so.
Co-Chair Meyer CLOSED public testimony.
SB 96 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
10:36:14 AM
The meeting was adjourned at 10:36 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 95 - NEW Sectional Analysis.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 95 |
| SB 95 - Sectional Analysis.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 95 |
| SB 96_SFIN_4-8-13.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 96 |
| SB 96 Sectional.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 96 |
| SB96.Apache letter.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 96 |
| Sponsor Statement SB 96.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 96 |
| SB 85 Alaska Aerofuel Letter of Support.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 85 |
| SB 85 FEDCo Letter of Support.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 85 |
| SB 85 CS Memo.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 85 |
| SB 85 Sponsor Statement.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 85 |
| SB 85 VWGoA Support.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 85 |
| HB 77 Amendment 1.pdf |
SFIN 4/8/2013 9:00:00 AM |
HB 77 |
| SB 74 - Dedicated Fund Question Legal Memo.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 74 |
| CS for SB 95 State Employee Compensation and Benefits.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 95 |
| DOA_SB95-HB195_BillOverview(April2013).pptx |
SFIN 4/8/2013 9:00:00 AM |
HB 195 SB 95 |
| HB77SCSCS(FIN)-DNR-MLW-4-8-13.pdf |
SFIN 4/8/2013 9:00:00 AM |
HB 77 |
| SB95-ACS-000-04-02-13.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 95 |
| SB074-UA-SYSBRA-4-01-13.pdf |
SFIN 4/8/2013 9:00:00 AM |
SB 74 |
| HB 77 Wrangell Resolution Opposition.pdf |
SFIN 4/8/2013 9:00:00 AM |
HB 77 |
| HB 77 Public Testimony - Sandberg.pdf |
SFIN 4/8/2013 9:00:00 AM |
HB 77 |
| HB 77 Publit Testimony Opposition - Hillstrand.pdf |
SFIN 4/8/2013 9:00:00 AM |
HB 77 |
| SB 26 AK Chapter comment 22March2013.pdf |
SFIN 4/8/2013 9:00:00 AM |
HB 77 SB 26 |