Legislature(2005 - 2006)SENATE FINANCE 532

02/22/2005 09:00 AM FINANCE


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09:04:45 AM SJR6
09:04:45 AM Start
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= SJR 6 FEDERAL MEDICAL ASSISTANCE REDUCTION TELECONFERENCED
Moved SJR 6 Out of Committee
+ HB 47 EXTEND BOARD OF REAL ESTATE APPRAISERS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                              MINUTES                                                                                         
                     SENATE FINANCE COMMITTEE                                                                                 
                         February 22, 2005                                                                                    
                             9:04 a.m.                                                                                        
                                                                                                                                
                                                                                                                              
CALL TO ORDER                                                                                                               
                                                                                                                                
Co-Chair Green convened the meeting at approximately 9:04:45 AM.                                                              
                                                                                                                                
PRESENT                                                                                                                     
                                                                                                                                
Senator Lyda Green, Co-Chair                                                                                                    
Senator Gary Wilken, Co-Chair                                                                                                   
Senator Con Bunde, Vice Chair                                                                                                   
Senator Fred Dyson                                                                                                              
Senator Lyman Hoffman                                                                                                           
                                                                                                                                
Also Attending: LALANYA SNYDER, Staff to Senator Ralph Samuels; PAT                                                           
DAVIDSON, Legislative Auditor, Legislative Audit Division                                                                       
                                                                                                                                
Attending via Teleconference: There were no teleconference                                                                    
participants.                                                                                                                   
                                                                                                                                
SUMMARY INFORMATION                                                                                                         
                                                                                                                                
SJR 6-FEDERAL MEDICAL ASSISTANCE REDUCTION                                                                                      
                                                                                                                                
The resolution reported from Committee.                                                                                         
                                                                                                                                
HB 47-EXTEND BOARD OF REAL ESTATE APPRAISERS                                                                                    
                                                                                                                                
The Committee heard from the bill's sponsor and the Legislative                                                                 
Audit Division. The bill was held in Committee.                                                                                 
                                                                                                                                
                                                                                                                                
     SENATE JOINT RESOLUTION NO. 6                                                                                              
     Relating to a reduction in the Federal Medical Assistance                                                                  
     Percentage for Alaskans, and urging the United States Congress                                                             
     to take action to prevent the reduction.                                                                                   
                                                                                                                                
                                                                                                                                
This was the second hearing for this bill in the Senate Finance                                                                 
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Green noted that this bill had been held in Committee in                                                               
order to receive updated fiscal note information.                                                                               
                                                                                                                                
Co-Chair Wilken  informed the Committee that four  new Department of                                                            
Health  and Social  Services fiscal  notes have  been provided  that                                                            
more  accurately depict  the impact  to the  State were  the FFY  06                                                            
Federal  Medical  Assistance Payment  (FMAP)  to decrease  from  the                                                            
current 57.58 percent level  to the proposed 50.16 percent level. He                                                            
specified that  these new fiscal notes, rather than  the Legislative                                                            
Affairs Agency's  zero fiscal note  dated February 16, 2005,  should                                                            
advance with the  bill. The analysis located on page  two of each of                                                            
the four  new  fiscal notes  provides the  detailed  effect on  each                                                            
component.                                                                                                                      
                                                                                                                                
Co-Chair Wilken  mentioned that the Department of  Health and Social                                                            
Services' handout  titled "Impact of FMAP Reduction  on State Match"                                                            
[copy  on  file]  would   provide  Members  additional  information                                                             
regarding the  impact of the federal  percentage match changes  over                                                            
time.                                                                                                                           
                                                                                                                                
Senator Hoffman voiced  that while he supports the Joint Resolution,                                                            
he is  concerned about  how the  projected financial  impact  to the                                                            
State  would   be  addressed  in   the  FY  06  budgetary   process;                                                            
specifically  whether Governor Frank  Murkowski or this Committee's                                                             
Department of  Health and Social Services (H&SS) subcommittee  would                                                            
be providing direction in its regard.                                                                                           
                                                                                                                                
Co-Chair Wilken  commented that the projected $52  million impact to                                                            
the State is not  included in Governor's FY 06 budget.  The decision                                                            
regarding whether  to include this  issue in this year's  budget has                                                            
not, of yet, been finalized.  The situation could be easily resolved                                                            
"structurally" but not easily resolved "financially".                                                                           
                                                                                                                                
Co-Chair Green  noted that the federal government  might not address                                                            
this issue by the time  that the Alaska Legislature finalizes its FY                                                            
06 budget. Either  zero or $52 million could be required.  She asked                                                            
Senator Hoffman  whether he had any  suggestions as to how  the H&SS                                                            
subcommittee could address this situation in the budget.                                                                        
                                                                                                                                
Senator Hoffman replied that, "we are a very rich State."                                                                       
                                                                                                                                
Co-Chair  Wilken   moved  to  report  SJR  6  from  Committee   with                                                            
individual recommendations and four new fiscal notes.                                                                           
                                                                                                                                
There being  no objections, SJR 6  was REPORTED from Committee  with                                                            
four  new zero  fiscal  notes, dated  February  18,  2005, from  the                                                            
Division of  Behavioral Health, The  Office of Children's  Services,                                                            
the Division of  Senior and Disabilities Medicaid  Services, and the                                                            
Division of  Health Care Services,  Department of Health  and Social                                                            
Services.                                                                                                                       
                                                                                                                                
                                                                                                                                
     CS FOR HOUSE BILL NO. 47(FIN)                                                                                              
     "An  Act  extending  the  termination  date  of  the  Board  of                                                            
     Certified   Real  Estate  Appraisers;   and  relating   to  the                                                            
     requirements  for  membership on  the Board  of Certified  Real                                                            
     Estate Appraisers."                                                                                                        
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Green  stated that this bill  would extend the life  of the                                                            
Board of Certified Real Estate Appraisers.                                                                                      
                                                                                                                                
LALANYA SNYDER,  Staff to Representative  Ralph Samuels,  the bill's                                                            
sponsor, expressed  that this "simple bill" would  extend the Board,                                                            
which  is responsible  for setting  professional  standards for  the                                                            
real estate appraisal profession,  developing exam standards for the                                                            
certification  of real estate appraisers,  and adopting regulations                                                             
to satisfy  state and federal regulations  until June 30,  2010. She                                                            
also  noted that  the Division  of  Legislative Audit  supports  the                                                            
extension  of the Board and  that the language  changes proposed  in                                                            
the  bill  would  make  it  "more  consistent."  The  sponsor  would                                                            
appreciate the Members' support of this legislation                                                                             
                                                                                                                                
Co-Chair Green asked for  further information regarding the proposal                                                            
to amend  language  in Sec  08.87.010 to  require  that general  and                                                            
residential   real  estate   appraiser  Board   members  should   be                                                            
"certified" rather than "licensed."                                                                                             
                                                                                                                                
Ms. Snyder  stated that  while the terms  are used interchangeably;                                                             
the proposed  change would align language  in Sec. 08.87.010.  Board                                                            
Created. with the State  Statute that utilizes the term "certified."                                                            
                                                                                                                                
Co-Chair  Green  pointed  out  that  the  Department   of  Commerce,                                                            
Community and  Economic Development  Fiscal Note #1, dated  February                                                            
20, 2005 would be revised  to "more properly" reflect the Board's FY                                                            
06 expenses. It was noted  that the Board was terminated on June 30,                                                            
2004, and,  as routine for terminated  boards, was allowed  one-year                                                            
to conclude its affairs.                                                                                                        
                                                                                                                                
PAT DAVIDSON,  Legislative Auditor,  Division of Legislative  Audit,                                                            
informed  that, in order  to quality for  federal deposit  insurance                                                            
and to participate  in selling federal  mortgage loan programs  such                                                            
as Fannie Mae  and Freddie Mac, financial institutions  in the State                                                            
must utilize  State certified  real estate  appraisers. While  Audit                                                            
Control Number:  08-20024-03,  dated July 17,  2003 did not  include                                                            
any  recommendations  other than  supporting  the extension  of  the                                                            
Board, it  should be noted  that the Board's  financial deficit  had                                                            
been addressed  last  year via such  things as  increasing fees  and                                                            
reducing costs.  No financial concerns  are reflected in  the Audit.                                                            
                                                                                                                                
Co-Chair Green  understood therefore that any areas  of concern have                                                            
been addressed.  She also noted that this Board serves  an important                                                            
role.                                                                                                                           
                                                                                                                                
Senator Hoffman asked for  further information regarding language on                                                            
page eight of the Audit  in the section titled "Recent federal study                                                            
determined oversight  of real estate appraisers should  be enhanced"                                                            
that specifies that the Board's "scope should be expanded."                                                                     
                                                                                                                                
Ms. Davidson replied  that, included in the Audit  is reference to a                                                            
prior  General Accounting  Office  (GAO)  report that  reviewed  the                                                            
entire federal  Title XI program and whether qualifications  of real                                                            
estate appraisers should  be expanded or enhanced. The State Statute                                                            
includes  language   to  the  effect  that  certified   real  estate                                                            
appraisers  in the State "maintain  their performance in  accordance                                                            
with  the federal  requirements  for their  profession."  Therefore,                                                            
were any changes to occur  at the federal level, these professionals                                                            
would be  required to conform  to the point  at which further  State                                                            
action might  be required.  She noted that  GAO's name has  now been                                                            
changed to the General Accountability Office.                                                                                   
                                                                                                                                
Co-Chair  Green understood  that page seven  of the Audit  addresses                                                            
items pertinent  to State  oversight of these  professions  and page                                                            
eight addresses the federal oversight.                                                                                          
                                                                                                                                
Co-Chair  Green  ordered  the bill  HELD  in  order to  acquire  the                                                            
aforementioned revised fiscal note.                                                                                             
                                                                                                                                
ADJOURNMENT                                                                                                                 
                                                                                                                                
Co-Chair Green adjourned the meeting at 09:17 AM.                                                                               

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