Legislature(1995 - 1996)

04/18/1996 03:05 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
                             MINUTES                                           
                    SENATE FINANCE COMMITTEE                                   
                         April 18, 1996                                        
                            3:05 p.m.                                          
                                                                               
  TAPES                                                                        
                                                                               
  SFC-96, #86, Side 1                                                          
  SFC-96, #86, Side 2 Malfunction                                              
                      No Recording                                             
  SFC-96, #87, Sides 1 and 2                                                   
  SFC-96, #88, Side  1 to (334)                                                
                                                                               
  CALL TO ORDER                                                                
                                                                               
  Senator  Rick Halford, Co-chairman,  convened the meeting at                 
  approximately 3:05 p.m.                                                      
                                                                               
  PRESENT                                                                      
                                                                               
  In  addition   to  Co-chairman  Halford,   Senators  Donley,                 
  Phillips,  Rieger,  Sharp, and  Zharoff  were present.   Co-                 
  chairman Frank arrived shortly after the meeting began.                      
                                                                               
  ALSO ATTENDING:  Senator Green; Karen Perdue,  Commissioner,                 
  Dept.  of  Health  and Social  Services;  Kristen  Bomengen,                 
  Assistant Attorney General, Human Services Section, Dept. of                 
  Law; Elmer Lindstrom, Special Assistant, Dept. of Health and                 
  Social Services; Dwight Perkins, Special Assistant, Dept. of                 
  Labor; Lamar Cotten, Deputy Commissioner, Dept. of Community                 
  and Regional Affairs;  Remond Henderson, Director,  Division                 
  of Administrative Services, Dept. of Community and  Regional                 
  Affairs; Arbe Williams, Director, Division of Administrative                 
  Services,   Dept.  of  Labor;  Curt  Lomas,  Welfare  Reform                 
  Program, Division of Public Assistance,  Dept. of Health and                 
  Social  Services; Glenda  Straube,  Director, Child  Support                 
  Enforcement  Division, Dept. of  Revenue; Mike Tibbles, aide                 
  to Senator Green;  and aides to committee  members and other                 
  members of the legislature.                                                  
                                                                               
  SUMMARY INFORMATION                                                          
                                                                               
  SB  98 -  WELFARE REFORM: TEMPORARY ASSIST. PROGRAM                          
                                                                               
            Discussion   was   had    with   Senator    Green,                 
            Commissioner  Perdue,  Kristen   Bomengen,  Glenda                 
            Straube, and Curt  Lomas.  Amendments 3,  4(c), 6,                 
            8, 9,  and 10  were ADOPTED.   CSSB  98 (Fin)  was                 
            REPORTED OUT of  committee with  new fiscal  notes                 
            from the Dept. of Health and Social Services.                      
                                                                               
  SB 229 -  UNEMPLOYMENT COMPENSATION & STEP PROGRAM                           
                                                                               
            Discussion  was had  with  Dwight Perkins,  Remond                 
                                                                               
                                                                               
            Henderson, Lamar Cotten, and  Arbe Williams.   The                 
            bill was held in committee pending  preparation of                 
            an amendment by Co-chairman Frank.                                 
                                                                               
  SB 301 -  POSTSECONDARY EDUCATION                                            
                                                                               
            Discussion  was  had with  Senator Green  and Mike                 
            Tibbles.   An  amendment  by  Senator  Rieger  was                 
            ADOPTED.    CSSB  301 (Fin)  was  REPORTED  OUT of                 
            committee with accompanying fiscal  notes from the                 
            Dept. of Revenue and the Dept. of Education.                       
                                                                               
                                                                               
  SENATE BILL NO. 98                                                           
                                                                               
       An Act  making changes related  to the aid  to families                 
       with dependent children  program, the Medicaid program,                 
       the general  relief assistance  program, and  the adult                 
       public assistance program; directing the Department  of                 
       Health  and  Social Services  to  apply to  the federal                 
       government for waivers to  implement the changes  where                 
       necessary; relating  to eligibility for  permanent fund                 
       dividends  of  certain  individuals who  receive  state                 
       assistance, to  notice requirements  applicable to  the                 
       dividend program; and providing for an effective date.                  
                                                                               
  Co-chairman  Halford  directed that  discussion  of  CSSB 98                 
  (Fin),  version  "B,"  adopted and  amended  at  the morning                 
  meeting,  continue.  He  advised of  two remaining  areas of                 
  concern:  The  first involves grandparent  responsibilities,                 
  and the second relates to occupational licenses.                             
                                                                               
  Prior  to  continuing   that  discussion,  the   Co-chairman                 
  directed attention to  language within Section 32,  page 44,                 
  and  noted  that  it  would   allow  legislators  access  to                 
  information in welfare cases.  He voiced ongoing frustration                 
  over inability to obtain adequate information.  Sec. 32 also                 
  contains  a protection  requiring  that information  not  be                 
  disclosed  as  public  information.  Senator Zharoff  voiced                 
  OBJECTION to the provision.   Co-chairman Halford noted that                 
  the  exemption is  narrow.   He stressed  the importance  of                 
  access to information  on programs on which  the legislature                 
  is  working  and  continuing  to  make revisions.    Senator                 
  Zharoff acknowledged greater  concern over original language                 
  which provided  for access  by legislative  staff.  The  Co-                 
  chairman noted  that original  provisions were  removed from                 
  the current proposal.                                                        
                                                                               
  Co-chairman  Halford  referenced  continued  interest  in  a                 
  ratable reduction and advised of an amendment that would add                 
  the provision to the bill.                                                   
                                                                               
  The Co-chairman  further referenced an  amendment applicable                 
                                                                               
                                                                               
  to CSED licensing provisions which would sunset that portion                 
  two years from  the effective date  of this act rather  than                 
  the effective date of federal action.                                        
                                                                               
  Senator Rieger  pointed to  language within  Section 35  and                 
  asked if it would  allow disclosure against the will  of the                 
  constituent.    Or,  would  it  provide  access  only  if  a                 
  constituent asked a legislator  to work on a problem  on his                 
  or her  behalf.   Co-chairman Halford said,  "It works  both                 
  ways."  It  could respond to a constituent complaining about                 
  receipt of benefits by someone who appears to be ineligible.                 
  It would also  respond to  those who seek  benefits but  are                 
  told  they do  not qualify.   He acknowledged  waivers which                 
  presently allow access to information on a particular client                 
  when the legislator is working on behalf of the client.                      
                                                                               
  Senator Rieger next  inquired concerning  the extent of  the                 
  personal information.   KRISTEN BOMENGEN, Assistant Attorney                 
  General, Human Services  Section, Dept. of Law,  attested to                 
  considerable  amounts  of  information  and  suggested  that                 
  language within  the bill  could be  made more  restrictive.                 
  Co-chairman Halford said  there was no intention  to include                 
  medical  information  and  suggested  that  the   department                 
  prepare  an  amendment  clarifying that  issue.    Financial                 
  information,  however,  would  be  pertinent to  legislative                 
  inquiries.    Ms. Bomengen  noted  that the  information may                 
  include other sensitive matters such  as discussion of child                 
  abuse issues.   A great many  areas of the  file may not  be                 
  pertinent  to  legislative  inquiry.    She  suggested  that                 
  perhaps merely summary information could be  made available.                 
                                                                               
                                                                               
  Discussion followed  regarding the  types of  inquiries that                 
  might  be  made on  behalf of  constituents or  as suspected                 
  fraud referrals.  Senator Randy Phillips advised of  need to                 
  balance  the   right  of   access  versus   the  rights   of                 
  individuals.   Ms. Bomengen  acknowledged that access sought                 
  by legislators may be allowable, under new federal law, with                 
  changes to wording in the present  draft of CSSB 98 (Fin) to                 
  provide summary information addressing the specific point of                 
  inquiry.   Ms.  Bomengen further cited  awkwardness stemming                 
  from  the  manner  in which  information  received  from the                 
  department would be conveyed  to constituents.   Co-chairman                 
  Halford reiterated  that it is  not the intent  that medical                 
  information  be disclosed.  He asked that Ms. Bomengen draft                 
  language allowing "a  reasonable review  of a specific  case                 
  without getting into the kinds of medical, child abuse, very                 
  personal  history  things,  that  are  not relevant  to  the                 
  immediate decisions of qualification  or non-qualification."                 
                                                                               
                                                                               
  Senator  Rieger  directed   attention  to  his   handwritten                 
  amendment, Amendment No. 3, and advised of need to apply the                 
  latter portion of the  amendment at both Page 42,  lines 13-                 
                                                                               
                                                                               
  19, and Page 38,  lines 2 through 8.  He  explained that the                 
  amendment relates to  instances in which individuals  may be                 
  caught off guard  by a  suspension of license  notice.   The                 
  first requirement ensures that individuals  have at least 60                 
  days' notice (from CSED)  that the individual is in  arrears                 
  in  child  support.    Further,   the  arrearage  must  have                 
  accumulated  to  at  least  4  months'  worth  of  payments.                 
  Senator Zharoff  inquired  concerning  the  average  monthly                 
  obligation.     GLENDA  STRAUBE,  Director,   Child  Support                 
  Enforcement  Division,  Dept.   of  Revenue,  advised   that                 
  payments are levied on  a percentage of income.   An across-                 
  the-board  average  is   approximately  $310.00  per  order.                 
  Senator Rieger MOVED  for adoption of  Amendment No. 3.   No                 
  objection having been raised, Amendment No. 3 was ADOPTED.                   
                                                                               
  Senator  Randy Phillips MOVED  to delete provisions relating                 
  to grandparents.   Co-chairman  Frank MOVED  language within                 
  Amendment 4 (a) as an alternative to deletion of grandparent                 
  provisions.    Ms.  Straube  explained  that  the  amendment                 
  addresses committee  concern  regarding  the  taking  of  20                 
  percent of paternal grandparent income.   The amendment will                 
  allow the court to decide what proportionate share should be                 
  paid.   Kristen Bomengen again  came before committee.   She                 
  explained that  the amendment was  drafted to provide  for a                 
  multitude  of  possible circumstances.   The  cost is  to be                 
  directly related to care  of the minor parent and  infant in                 
  an  adult supervised  setting.   The  second portion  of the                 
  amendment provides the following definition of grandparent:                  
                                                                               
       For the purposes of this paragraph,  a grandparent                      
       is the  natural or  adoptive parent  of the  minor                      
       parent.                                                                 
                                                                               
  Senator Rieger expressed concern that  there does not appear                 
  to  be  a cap  on the  amount  awarded from  a grandparent's                 
  income.   The  intent was  to  allow it  to  be lower.    He                 
  suggested that language should require a proportionate share                 
  but also say "but in no event more than" a specific cap.                     
                                                                               
  Discussion  followed  regarding circumstances  in  which the                 
  infant  might  require  extraordinary  medical  care.    Co-                 
  chairman Halford asked if grandparents would be obligated to                 
  pay  a  proportionate  share  of  the bill.    Ms.  Bomengen                 
  responded affirmatively.                                                     
                                                                               
  Discussion of revision of wording  within Amendment No. 4(a)                 
  followed  between Co-chairman  Halford  and Senator  Rieger.                 
  Co-chairman Frank asked if the  court would first apply  the                 
  20  percent rule or levy a proportion  of the actual cost of                 
  care.  Co-chairman  Halford noted  that, per the  amendment,                 
  the court  would use whatever  is lower.   Co-chairman Frank                 
  voiced  support  for  a  dollar  limitation  rather  than  a                 
  percentage.   Further  discussion  of average  child support                 
  payments  ensued.    A subsequent  suggestion  was  made for                 
                                                                               
                                                                               
  language requiring payment of  half the cost of care  but no                 
  more than $500.00 a month.                                                   
                                                                               
  Glenda  Straube  referenced  federal  constraints  on  child                 
  support guidelines.   Actual  dollar amounts  pose problems.                 
  The state  is required  to establish  guidelines that  allow                 
  assessment  based  on an  obligor's  earnings.   Co-chairman                 
  Frank noted that that makes sense for parents but questioned                 
  application to grandparents as well.   Further discussion of                 
  proportionate share followed, using as  an example a divorce                 
  situation   involving   grandparents   in    four   separate                 
  households.  Discussion of recovery of AFDC payments ensued.                 
                                                                               
  END:      SFC-96, #86, Side 1                                                
  (Malfunction on SFC-96, #86, Side 2                                          
  tape would not reverse.)                                                     
  BEGIN:    SFC-96, #87, Side 1                                                
                                                                               
  A  replacement  for Amendment  No.  4(a) was  distributed to                 
  members for review and designated Amendment  No. 4 (c).  Co-                 
  chairman  Halford called for  a show  of hands  on adoption.                 
  Amendment No. 4(c) was ADOPTED.                                              
                                                                               
  Co-chairman  Halford next  called  for a  show  of hands  on                 
  Senator  Phillips'  motion   for  deletion  of   grandparent                 
  provisions, which  the Co-chairman  designated as  Amendment                 
  No. 5.  Amendment No. 5 failed to be adopted.                                
                                                                               
  Senator Sharp MOVED  for adoption  of Amendment No.  6.   He                 
  explained that it deletes language providing exceptions from                 
  licensing provisions.   The only remaining  exemptions would                 
  be limited entry permits and driver licenses.  Senator Sharp                 
  noted that driver licenses are adequately covered in another                 
  section, and the division has testified  it presently has an                 
  effective means of collection of payments from those holding                 
  limited entry permits.   Co-chairman Halford voiced  support                 
  for  the  amendment   but  acknowledged  that   recreational                 
  licenses (hunting and  fishing), called for in  federal law,                 
  are  not  included in  the  proposed  bill.   That  raises a                 
  further  question  regarding  crew  licenses for  commercial                 
  fishing which are  sold by the  same vendors as hunting  and                 
  fishing licenses.   Since administrative capability to  deal                 
  with crew licenses  will be  necessary, the legislature  may                 
  add  an  amendment  to cover  hunting  and  fishing licenses                 
  because that question will ultimately have to be dealt with.                 
  Senator  Sharp  concurred.   He  said  he  did  not  include                 
  recreational licenses at  this time  because they would  not                 
  generate  a  great  amount  of  income.   The  situation  is                 
  different for crew members.  He acknowledged that collection                 
  might become an administrative nightmare.                                    
                                                                               
  Discussion of proposed removal of  the exemption for nursing                 
  home  licenses  followed.    Senator  Sharp  stressed   that                 
  directors  of non-profits  often  have significant  salaries                 
                                                                               
                                                                               
  that should not be exempt.                                                   
                                                                               
  Co-chairman  Halford called  for objections  to adoption  of                 
  Amendment No. 6.  Senator  Zharoff voiced OBJECTION relating                 
  to crew and vessel  licenses.  The Co-chairman called  for a                 
  show of hands, and  Amendment No. 6 was ADOPTED.                             
                                                                               
  Co-chairman Halford next referenced Senator Phillips' motion                 
  for  deletion  of  Section  22,  relating to  all  licensing                 
  provisions, which he  designated Amendment  No. 7.   Senator                 
  Phillips  asked  how individuals  could  be expected  to pay                 
  child support if  the license  he or  she needs  to work  is                 
  removed.  Co-chairman  Halford called for  a show of  hands.                 
  Amendment No. 7 failed to be adopted on a vote of 2 to 5.                    
                                                                               
  Co-chairman Halford next directed attention to Amendment No.                 
  8 which he explained would change the effective date of CSED                 
  enforcement language and tie it to the effective date of the                 
  bill rather than  enactment of  federal requirements.   CSED                 
  language would remain in effect  for two years following the                 
  effective  date  of   state  legislation.    KAREN   PERDUE,                 
  Commissioner, Dept. of Health  and Social Services,  advised                 
  that federal occupational licensing provisions are scheduled                 
  for U.S. Senate action in the second week in May.   The U.S.                 
  House of  Representatives will  thereafter commence  action.                 
  The  status  when  it eventually  reaches  the  President is                 
  unknown at this time.   Senator Sharp MOVED for  adoption of                 
  Amendment No. 8.  No objection having been raised, Amendment                 
  No. 8 was ADOPTED.                                                           
                                                                               
  Co-chairman Halford  next direction  attention to  Amendment                 
  No. 9 and noted that it applies to release of information to                 
  legislators.                                                                 
                                                                               
  Senator Zharoff asked if any portions of the  welfare reform                 
  bill  might  be  subject to  constitutional  or  other legal                 
  challenge.  Co-chairman  Halford acknowledged potential  for                 
  challenge.    He  advised  that portions  of  the  bill  are                 
  severable as a matter of general statutory construction.                     
                                                                               
  The Co-chairman again  referenced Amendment No. 9  and noted                 
  that language is limited to  financial information.  It also                 
  makes  provisions  consistent  with  federal  law.    It  is                 
  intended to allow legislators to "at  least get an answer to                 
  a simple question when  you get a constituent problem  on an                 
  area  of potential welfare abuse."   Senator Sharp MOVED for                 
  adoption  of Amendment  No.  9.   Senator  Zharoff raised  a                 
  question concerning penalties for disclosure of confidential                 
  information.   Kristen Bomengen  said those  who misuse  the                 
  information would  be subject  to hearing under  legislative                 
  conduct provisions or subject to criminal  prosecution under                 
  AS 11.56.860, a class-A misdemeanor.                                         
                                                                               
  Senator  Zharoff  voiced   need  for   a  reminder  of   the                 
                                                                               
                                                                               
  confidentiality   of   the   information   and  noted   that                 
  legislators  are required to  sign oaths  of confidentiality                 
  prior  to  receiving  certain  oil  and  gas  or  litigation                 
  information  from  the Dept.  of  Law.   Co-chairman Halford                 
  concurred in  need for  a notification  provision.   Senator                 
  Randy  Phillips concurred, citing such a provisions relating                 
  to  permanent  fund dividend  information.    Senator Donley                 
  inquired   concerning   legislative  liability   should  the                 
  information be leaked while in  legislative possession.  Co-                 
  chairman Halford referenced  amendment language saying  that                 
  the information is  to remain confidential and  shall not be                 
  subject to further disclosure.  Senator Donley  asked if the                 
  language would trigger criminal provisions making disclosure                 
  a crime.   Kristen Bomengen reiterated her  earlier comments                 
  saying  that violations  would  be  subject  to  legislative                 
  ethics   hearings   and  subsequent   criminal  prosecution.                 
  Senator Zharoff stressed  need to notify the  requestor that                 
  the information  is confidential.   Ms.  Bomengen said  that                 
  regulations should cover  the matter with  a cover sheet  or                 
  form that would have to be signed.                                           
                                                                               
  Senator  Donley  suggested additional  language  saying that                 
  penalties are  not triggered  unless the  one receiving  the                 
  information is  notified, at the  time of receipt,  that the                 
  information  is   confidential  and  may   not  be   further                 
  disclosed.    The  Senator  then  MOVED  for  adoption of  a                 
  conceptual  amendment adding  that requirement  to Amendment                 
  No.  9.   Senator  Rieger noted  that  the individual  to be                 
  harmed would be the subject of the information.   He said he                 
  was  not  comfortable with  the  conceptual amendment.   Co-                 
  chairman Halford called for a show of hands.  The conceptual                 
  amendment was ADOPTED on a vote of 6 to 1.                                   
                                                                               
  Co-chairman Halford next  called for objections  to adoption                 
  of Amendment  No.  9.    No objection  having  been  raised,                 
  Amendment No. 9 was ADOPTED.                                                 
                                                                               
  The Co-chairman referenced additional amendments relating to                 
  the 3 percent  ratable reduction  and a provision  extending                 
  transitional medical and day care  assistance from twelve to                 
  twenty-four months.   Existing language provides  for twelve                 
  months.  The foregoing amendments were not offered.                          
                                                                               
  Co-chairman Halford  referenced a  question surrounding  the                 
  index for  safety provisions relating to  redetermination of                 
  assistance levels  in terms  of whether  it should apply  to                 
  total funds  or merely  state funds.   The  department feels                 
  that  application   to   total   funds   would   result   in                 
  disincentives to strive  for federal rewards and  management                 
  incentives.   The department  would prefer  an amendment  to                 
  reflect  general  funds  or state  funds  rather  than total                 
  funds. Commissioner Perdue reiterated  that language at Page                 
  49, lines 5 and  6, would serve as a  disincintive to garner                 
  federal funds.  She  thus requested that the cap  be limited                 
                                                                               
                                                                               
  to  state  funds.    Co-chairman  Halford  said  he  had  no                 
  objection.   The  proposed  formula was  merely  a means  of                 
  preventing the  program  from growing  out of  control.   As                 
  Amendment  No. 10,  Senator Sharp MOVED  to insert  the word                 
  "state" between  the words "total"  and "funds" at  Page 49,                 
  lines 5 and 6.   No objection having been  raised, Amendment                 
  No. 10 was ADOPTED.                                                          
                                                                               
  Senator Green referenced an amendment pertaining to two-year                 
  transitional medical  and day care coverage,  stressing that                 
  it represents  a one-time opportunity.   Co-chairman Halford                 
  voiced his  understanding that the proposed  amendment would                 
  cost $850.0.   He  said he  would support  the amendment  if                 
  accompanied with a ratable reduction.                                        
                                                                               
  Co-chairman Halford next requested an analysis of the fiscal                 
  notes.                                                                       
  CURT  LOMAS,  Welfare  Reform  Program,  Division  of Public                 
  Assistance, Dept. of Health and Social Services, came before                 
  committee.  He  said he could provide  a preliminary summary                 
  but noted specific need to work with the Dept. of Revenue on                 
  effective date changes regarding  child support collections.                 
  The department will be developing two separate sets of notes                 
  because of implementation provisions  providing for a waiver                 
  track if federal  reform is not  in place by October,  1996,                 
  and  a comprehensive  track  if federal  law passes  by that                 
  date.  He then provided the following numbers:                               
                                                                               
                                     Waiver                                    
  Comprehensive                                                                
                                                                               
  DH&SS                            $1,264.0           $1,442.0                 
                                                                               
  Savings over 5 yrs. thru                                                     
  2002                            $19,560.0          $40,646.0                 
                                                                               
  Both  tracks show  a negative  fiscal note  in  FY 98  and a                 
  positive note in FY 97.  The negative total under the waiver                 
  approach is $2,282.0 and $3,556.0 under comprehensive.  That                 
  discounts child  support collection  impacts.   If licensing                 
  provisions are enacted and collections  begin, there will be                 
  a $224.0 savings  in FY 97 under  the comprehensive approach                 
  and enactment of federal law, and  a $46.2 savings under the                 
  waiver approach if licensing provisions  go into effect when                 
  the bill becomes effective.                                                  
                                                                               
  Co-chairman Halford asked  how much of the  fiscal note cost                 
  is discretionary in terms of department actions.   Mr. Lomas                 
  advised  that  the   present  breakout   does  not   contain                 
  sufficient information  to respond precisely.   Commissioner                 
  Perdue stressed that calculations do not  include additional                 
  child care dollars.                                                          
                                                                               
  END:      SFC-96, #87, Side 1                                                
                                                                               
                                                                               
  BEGIN:    SFC-96, #87, Side 2                                                
                                                                               
  Co-chairman  Halford  asked  for  a  breakdown of  the  $1.2                 
  million cost associated with the waiver program.  Mr.  Lomas                 
  explained that implementation costs for  both the waiver and                 
  comprehensive approach are  very close the first  year.  The                 
  biggest cost is  data processing.   Both approaches  require                 
  extensive  modifications  to the  data  system.   The waiver                 
  approach  is more expensive  because it requires development                 
  of two  tracks and  comparison of  experimental and  control                 
  groups.  Those  costs do not  accrue until the second  year.                 
  That  makes the  waiver approach  approximately $400.0  more                 
  expensive than the comprehensive approach in that year.                      
                                                                               
  In response  to a question  from the Co-chairman,  Mr. Lomas                 
  advised  that  the  department could  provide  new  notes by                 
  Saturday,  April  20,  1996.  Co-chairman  Halford   queried                 
  members   regarding   movement   of   the   bill   with  the                 
  understanding that the two sets of fiscal notes will reflect                 
  approximately $1.2 million  and $1.4  million for the  first                 
  year.  Senator Sharp MOVED for passage of CSSB 98 (Fin) with                 
  individual recommendations and fiscal  notes to be  provided                 
  by the department.  No objection having been raised, CSSB 98                 
  (Fin) was REPORTED  OUT of  committee.  Co-chairmen  Halford                 
  and Frank and Senators Rieger and Sharp signed the committee                 
  report with a "do pass" recommendation.  Senators Donley and                 
  Zharoff  signed "no recommendation."  Senator Randy Phillips                 
  signed "do pass if amended."   The following Dept. of Health                 
  and Social Services fiscal notes accompanied the bill:                       
                                                                               
                                Waiver         Comprehensive                   
                                                                               
  AFDC Policy Provisions        (690.4)          (1,489.7)                     
  PA Administration              297.2              220.5                      
  PA Data Processing             543.0              543.0                      
  Family and Youth Services      100.2              100.2                      
                                                                               
  Fiscal  notes  for  Alaska  Work  Programs  and  Child  Care                 
  Benefits were also  provided showing costs under  the waiver                 
  program commencing in FY 99.                                                 
                                                                               
                                                                               
  SENATE BILL NO. 229                                                          
                                                                               
       An  Act relating  to  employment contributions  and  to                 
       making  the state  training  and  employment program  a                 
       permanent state program; and providing for an effective                 
       date.                                                                   
                                                                               
  Co-chairman Halford directed  that SB 229 be  brought on for                 
  discussion.   DWIGHT  PERKINS, Special  Assistant, Dept.  of                 
  Labor, came before committee to speak to CSSB 229 (L&C).  He                 
  explained that it reflects combination of SB 229 and SB 276.                 
                                                                               
                                                                               
  In the first portion,  concerns raised by both the  Dept. of                 
  Community and  Regional Affairs and the Dept.  of Labor were                 
  addressed and agreed upon  in CSSB 229 (CRA).   The original                 
  SB 229 made the STEP  program (State Training and Employment                 
  Program) permanent.   The six-year pilot program  has worked                 
  well over that term.  Sunset provisions were then applied to                 
  the program which changed the title of the legislation.  Mr.                 
  Perkins pointed  to further  wording changes  and additional                 
  subsections incorporated within  the new version.   He spoke                 
  to changes to improve past  problems with record keeping  in                 
  service delivery areas, a limitation of administrative costs                 
  to 20 percent, and new reporting requirements.                               
                                                                               
  The second portion  of the bill was  originally incorporated                 
  within SB 276--calculation of  weekly benefits for insurance                 
  claimants.   Directing attention  to page 10,  line 27,  Mr.                 
  Perkins noted  the current  weekly benefit  for unemployment                 
  insurance.  He  explained that  the payment is  based on  75                 
  percent of the average weekly wage earned by the individual.                 
  He further noted a maximum of $248.00 per week.                              
                                                                               
  Pointing to  accompanying fiscal notes, Mr.  Perkins advised                 
  that the $3,946.2  (relating to Sec.  2) refers to the  STEP                 
  program.  The  $231.8 note  (relating to Sec.  5) shows  the                 
  unemployment benefit  increase.   Fiscal notes  do not  seek                 
  additional moneys in the budget.   Mr. Perkins next spoke to                 
  qualifications which make workers eligible for  unemployment                 
  benefits.                                                                    
                                                                               
  Discussion in previous committees indicated that while there                 
  was no objection  to increasing  the weekly benefit  amount,                 
  legislators  and  constituents   would  "like  to   see  the                 
  employees  picking up  part  of this  cost."   Under present                 
  statutes, the employer pays 82 percent and the employee pays                 
  18  percent.   Mr.  Perkins  then  attested  to  a  proposed                 
  reduction,  to the  employer,  of $15  per  employee and  an                 
  increase in employee  payments of $20  per year (38 cents  a                 
  week).                                                                       
                                                                               
  Senator  Rieger  inquired concerning  cross-subsidization of                 
  unemployment benefits.  He suggested  that those employed in                 
  seasonal jobs collect more unemployment benefits  than those                 
  working  year-round  jobs.     Mr.  Perkins  explained  that                 
  everyone who works pays half of one percent for unemployment                 
  insurance.   Total  collections are  not industry  specific.                 
  However, one industry does not subsidize another since those                 
  in seasonal jobs have higher rates than those in  year-round                 
  jobs.                                                                        
                                                                               
  REMOND HENDERSON, Director,  Administrative Services,  Dept.                 
  of  Community   and  Regional  Affairs,   next  came  before                 
  committee.  He  clarified that  while collections accrue  to                 
                                                                               
                                                                               
  one  account,  moneys  are  separated  by  industry.    ARBE                 
  WILLIAMS, Director, Administrative Services, Dept. of Labor,                 
  concurred that rates  for individual  industries are set  to                 
  cover the cost of benefits for the industry.                                 
                                                                               
  In response to  a question from Senator  Sharp, Ms. Williams                 
  advised  that  an employer's  rate  is based  on  how steady                 
  employment has been over a previous period of time.                          
                                                                               
  Responding to a further question from Co-chairman Frank, Ms.                 
  Williams  explained  that funds  paid  by both  employer and                 
  employee  accrue to the  employer trust fund.   Payments are                 
  handled  like trust  fund moneys.   Senator Rieger  asked if                 
  benefits are appropriated by the  legislature.  Ms. Williams                 
  responded  negatively, saying  they flow  directly  from the                 
  unemployment insurance trust fund.                                           
                                                                               
  Co-chairman  Frank  asked  why  STEP  program  services  are                 
  limited to those who have been  employed over the last three                 
  years.  Ms. Williams  advised that the program is  funded by                 
  employee   contributions   to   minimize   the   effect   of                 
  unemployment on the  trust fund.   It was felt important  to                 
  maintain a  tie between workers  who both contribute  to the                 
  program and may  subsequently need to benefit  from training                 
  programs  offered  by  STEP.     STEP  is  a   diversion  of                 
  unemployment   insurance  moneys   to   which  all   workers                 
  contribute.                                                                  
                                                                               
  Co-chairman Frank inquired concerning availability of  other                 
  programs to those who have not been employed for a period of                 
  time.  Ms.  Williams attested to numerous  federal programs.                 
  Discussion of JTPA and other training programs followed.                     
                                                                               
  Co-chairman Frank next asked who  would receive grants under                 
  the proposed  bill.  Mr.  Perkins explained that  funds flow                 
  through the Dept.  of Labor  to the Dept.  of Community  and                 
  Regional Affairs for dispersement.  Mr. Henderson said funds                 
  are dispersed by three services  delivery areas:  Anchorage,                 
  Fairbanks, and the balance  of state.  He referenced  a list                 
  (copy on file in the original Senate Finance Committee  file                 
  for SB 229) of recipients for 1995.                                          
                                                                               
  Senator  Donley  voiced  his  understanding  that  the  bill                 
  decreases  contributions  from   employers,  and   increases                 
  contributions   from   employees,  to   extend  unemployment                 
  benefits and fund  the STEP training  program.  Mr.  Perkins                 
  reiterated  that  the  bill   reflects  combination  of  two                 
  unrelated pieces of  legislation.   The sources of  incoming                 
  revenues  to pay  for  the  programs  are different.    Only                 
  employee-generated payments fund STEP.                                       
                                                                               
  Discussion followed between Senator Donley and Arbe Williams                 
  regarding diversion  of trust fund  moneys to fund  the STEP                 
  program.   Mr. Perkins advised that the program is scheduled                 
                                                                               
                                                                               
  to end on June  30.  The first portion of  the proposed bill                 
  would re-establish it  in law and provide  a two-year sunset                 
  for subsequent legislative review.                                           
                                                                               
  Further discussion and review of the list of training grants                 
  followed.                                                                    
                                                                               
  END:      SFC-96, #87, Side 2                                                
  BEGIN:    SFC-96, #88, Side 1                                                
                                                                               
  Co-chairman Halford specifically inquired  concerning grants                 
  to  entities  outside  the  state.    LAMAR  COTTEN,  Deputy                 
  Commissioner,  Dept. of Community and Regional Affairs, came                 
  before  committee.   He advised  that Golden Age  Fishery in                 
  Seattle is a partner with  one of the CDQ groups  in Alaska.                 
  Mr. Perkins added  that necessary  in-state training is  not                 
  always  available.   Arbe  Williams  noted that  training is                 
  provided to those who qualify for STEP funds--those who have                 
  an  attachment to  the Alaska  unemployment insurance  trust                 
  fund.                                                                        
                                                                               
  Further discussion  of listed grantees and training services                 
  ensued.  Co-chairman Halford referenced $142.0 in individual                 
  referrals and subgrants  of $865.0 for a  total of $1,008.9.                 
  Mr. Henderson advised that  the total reflects actual  FY 95                 
  expenditures in  the statewide  service delivery  area only.                 
  Expenditures for  the Anchorage  service  area were  $731.0.                 
  The  Fairbanks  area  expended  approximately $170.0.    The                 
  fiscal note is an estimate of FY 97 expenditure based on the                 
  amount  being RSA'd to  the Dept. of  Community and Regional                 
  Affairs by the Dept. of Labor.  That totals $3,333.6.                        
                                                                               
  In response to an inquiry  from Co-chairman Frank concerning                 
  how people find  out about the  STEP program and the  actual                 
  point  of  entry,   Mr.  Henderson  attested  to   brochures                 
  advertising  the program as part of the general job training                 
  information the department provides.  Services  are provided                 
  through field  offices.   Arbe Williams  added that  welfare                 
  counselors are also aware of  the program as are  employment                 
  service employees in the Dept. of Labor's 19 field  offices.                 
                                                                               
                                                                               
  Co-chairman Frank  asked what  would prevent employers  from                 
  using  the  program to  fund training  for  new hires.   Mr.                 
  Henderson noted need for the  individual to have contributed                 
  to  the unemployment insurance fund  in order to qualify and                 
  be eligible for the program.  He acknowledged that employers                 
  could take advantage  of the program  for new trainees.   He                 
  further  advised  of  benefits  of  JTPA (the  Job  Training                 
  Partnership Act) under  which employers pay only  50 percent                 
  of  the  employee's  wage  during  training.    Mr.  Perkins                 
  stressed that  both programs  assist in  getting individuals                 
  off  welfare or unemployment and into  productive jobs.  Co-                 
  chairman Frank asked  why the program could not  be extended                 
                                                                               
                                                                               
  to the longer term unemployed.  Arbe Williams explained that                 
  not every employer,  employee, or occupation is  eligible to                 
  receive STEP  funds.   The program  targets occupations  and                 
  industries that have high unemployment and tend to hire non-                 
  residents.    Statistics are  derived  from the  annual non-                 
  resident  hire  report.    Funds   are  dispersed  by  area,                 
  depending upon where  those occupations  and industries  are                 
  located.                                                                     
                                                                               
  Senator Donley MOVED for passage of the bill with individual                 
  recommendations.    Co-chairman  Frank  expressed  need   to                 
  determine whether training programs  could serve longer term                 
  unemployed individuals as  well.  He expressed  concern that                 
  some  individuals  have  been  denied benefits  because  the                 
  program  targets  the   recently  unemployed.    Co-chairman                 
  Halford voiced  his  understanding that  subgrants apply  to                 
  anyone.   Co-chairman Frank said  that if an  individual has                 
  not worked  for four  years, he  or she  would not  qualify.                 
  Arbe  Williams concurred.  She  explained that the reason is                 
  that  employees are  paying for  the program.   Mr.  Perkins                 
  voiced need to review expansion of the  program to determine                 
  whether or not there might be  negative impact on the trust.                 
  Mr. Henderson  suggested  that expansion  could  be  handled                 
  since all  available funds  are not  currently being  spent.                 
  Co-chairman Frank attested to the desirability of  expanding                 
  the program to a larger pool of participants.  Arbe Williams                 
  advised that she would feel  more comfortable consulting the                 
  actuarial regarding the potential impact  on the trust fund,                 
  before action is taken.  At this time, the STEP program is a                 
  "fairly small pot of money" that serves a "fairly small pool                 
  of people."                                                                  
                                                                               
  Co-chairman Halford suggested that Co-chairman Frank develop                 
  an amendment for  discussion at the  next meeting.   Senator                 
  Donley  withdrew his motion for passage,  and CSSB 229 (L&C)                 
  was held in committee.                                                       
                                                                               
                                                                               
  SENATE BILL NO. 301                                                          
                                                                               
       An Act relating to postsecondary education.                             
                                                                               
  Co-chairman  Halford directed that SB 301  be brought on for                 
  discussion.    SENATOR  LYDA  GREEN  came  before  committee                 
  accompanied by her  aide, MIKE TIBBLES.   She referenced  an                 
  Executive Order  relating  to  postsecondary  education  and                 
  noted   a   preference   for   effecting   changes   through                 
  legislation.    The  Senator  pointed  to  outdated  federal                 
  requirements "that were being transferred from one agency to                 
  another."    Legislation   will  effectively  repeal  those.                 
  Further,  if  changes  within postsecondary  were  made  via                 
  Executive Order,  the legislature would  lose oversight  and                 
  ability to confirm  board members.   The legislature  should                 
                                                                               
                                                                               
  maintain  some  control  over  individuals making  financial                 
  decisions which ultimately impact many Alaskan students.                     
                                                                               
  The  proposed  bill  would  move  the  Alaska  Student  Loan                 
  Corporation from  the Dept.  of Education  to  the Dept.  of                 
  Revenue and  transfer the functions of the Alaska Commission                 
  on  Postsecondary  Education  to  the  Alaska  Student  Loan                 
  Corporation.    It  attempts to  change  composition  of the                 
  corporate board to eliminate special  interests and create a                 
  majority of public members and  a minority of commissioners.                 
  The legislative  confirmation  process  would  be  continued                 
  under the bill.   There  is a further  requirement that  the                 
  corporation establish  separate accounts  for the  teachers'                 
  scholarship  revolving  loan  fund  account and  the  family                 
  education loan account.                                                      
                                                                               
  The bill also  includes a correction  to SB 123 wherein  the                 
  prorata  shares  for  half-time graduate  and  undergraduate                 
  students was reversed.   SB  123 also established  full-time                 
  career educations as six weeks in length.  The proposed bill                 
  establishes  the  shortest   half-time  career   educational                 
  programs as at least twelve weeks in length.                                 
                                                                               
  The  loan origination  fee will  be used  to offset  default                 
  loses in the memorial  scholarship loan program.  And  a new                 
  provision  is  added  to allow  those  participating  in the                 
  family education  program  to  make  payments  earlier  than                 
  required by law.  WAMI is  moved to the University of Alaska                 
  to simplify the budget process.                                              
                                                                               
  Senator  Rieger expressed  concern that  the corporation  is                 
  "getting into deeper and  deeper trouble ever since we  went                 
  to bonding  back in  1986 .  . .  ."   He voiced  additional                 
  concern  over  proposed transfer  of WICHE  and WAMI  to the                 
  University.                                                                  
                                                                               
  Senator Rieger also raised concern regarding public interest                 
  language within Section 6 at page 4.                                         
                                                                               
  Mike Tibbles advised that  WICHE would remain in place.   It                 
  is  merely  being  transferred from  the  commission  to the                 
  corporation.    It  is  the   WAMI  program  that  would  be                 
  transferred to  the University.   Senator  Green noted  that                 
  display of WAMI  funding as a  single item would provided  a                 
  better indication of what is actually being spent.                           
                                                                               
  Speaking  to  concern  regarding   Section  6,  Mr.  Tibbles                 
  explained   that  AS   14.42.050  (legal  counsel   for  the                 
  commission) is deleted  in the repealing section.   Language                 
  within Section 6 appears to be the same as that removed.  It                 
  is merely being taken from the  commission and placed in the                 
  corporation.  Senator Green concurred that a great amount of                 
  the proposed bill involves renaming what previously  related                 
  to the commission to make it apply to the corporation.                       
                                                                               
                                                                               
  Co-chairman Halford raised a question concerning  past legal                 
  opinions   that  corporate   boards  are   not  subject   to                 
  legislative  confirmation  because  they  do  not  fit under                 
  current confirmation law.   Mr. Tibbles said  statutes spell                 
  out the members of  the commission and hold them  subject to                 
  confirmation.  The  corporation consists  of the members  of                 
  the commission.                                                              
                                                                               
  Senator  Rieger  MOVED  to  delete   Section  2  and  effect                 
  necessary  conforming  amendments  associated with  removal.                 
  WAMI would thus  remain as it  is.  Senator Green  expressed                 
  interest in examining the WAMI program.  She suggested  that                 
  it is not doing as intended in terms of luring students back                 
  to  Alaska once  they have  completed their  education.   No                 
  objection  having  been raised,  Amendment  No. 1  to remove                 
  Section 2 was ADOPTED.                                                       
                                                                               
  Senator Rieger MOVED that CSSB 301 (Fin) pass from committee                 
  with  individual  recommendations  and  accompanying  fiscal                 
  notes.  No objection having been  raised, CSSB 301 (Fin) was                 
  REPORTED OUT of committee with the following fiscal notes:                   
                                                                               
       Dept. of Revenue                        $45.0                           
       Dept. of Education/Student Loans          6.0                           
       Dept. of Education/Inst.Auth.           125.0                           
       DOE/Postsecondary/Boards and Comm.       64.2                           
       DOE/Postsecondary/Administration        (22.0)                          
                                                                               
  Co-chairmen  Halford and Frank  signed the  committee report                 
  with a "do pass" recommendation.  Senators Phillips, Rieger,                 
  Sharp, and Zharoff signed "no recommendation."                               
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  The meeting was adjourned at approximately 7:05 p.m.                         
                                                                               

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