Legislature(2015 - 2016)Anch LIO Room A,B,C

05/22/2015 02:00 PM FINANCE

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Audio Topic
02:18:15 PM Start
02:18:56 PM SB2001
02:35:50 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB2001 Presentation: Overview FY17 Operating Budget TELECONFERENCED
Heard & Held
                 SENATE FINANCE COMMITTEE                                                                                       
                  SECOND SPECIAL SESSION                                                                                        
                       May 22, 2015                                                                                             
                         2:18 p.m.                                                                                              
                                                                                                                                
[Note: The meeting was held in Anchorage, Alaska at the                                                                         
Anchorage Legislative Information Office]                                                                                       
                                                                                                                                
2:18:15 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Kelly called the Senate Finance Committee meeting                                                                      
to order at 2:18 p.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Pete Kelly, Co-Chair                                                                                                    
Senator Peter Micciche, Vice-Chair                                                                                              
Senator Click Bishop                                                                                                            
Senator Mike Dunleavy                                                                                                           
Senator Lyman Hoffman (via teleconference)                                                                                      
Senator Donny Olson                                                                                                             
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Anna MacKinnon, Co-Chair                                                                                                
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
James  Armstrong, Staff,  Senator  Pete  Kelly; David  Teal,                                                                    
Director,   Legislative   Finance  Division;   Pat   Pitney,                                                                    
Director,  Office of  Management and  Budget, Office  of the                                                                    
Governor.                                                                                                                       
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SB 2001   APPROP: OPERATING BUDGET/LOANS/FUNDS                                                                                  
                                                                                                                                
          SB 2001 was HEARD and HELD in committee for                                                                           
          further consideration.                                                                                                
                                                                                                                                
SENATE BILL NO. 2001                                                                                                          
                                                                                                                                
     "An Act making appropriations for the operating and                                                                        
     loan program expenses of state government and for                                                                          
     certain  programs  and  capitalizing  funds;  repealing                                                                    
     appropriations;  making appropriations  under art.  IX,                                                                    
     sec. 17(c),  Constitution of the State  of Alaska, from                                                                    
     the constitutional  budget reserve fund;  and providing                                                                    
     for an effective date."                                                                                                    
                                                                                                                                
2:18:56 PM                                                                                                                    
                                                                                                                                
Co-Chair  Kelly  stated that  there  would  be some  invited                                                                    
testimony in the  day's meeting. He stated that  SB 2001 was                                                                    
the special  session version of  the vetoed  regular session                                                                    
operating  budget  bill. He  stated  that  the current  bill                                                                    
represented  the  Conference   Committee  version  from  the                                                                    
regular session.                                                                                                                
                                                                                                                                
Vice-Chair Micciche  wondered if  the vetoed items  from the                                                                    
Governor were in SB 2001.  He stated that he understood that                                                                    
the  Governor had  funded the  remaining supplementary  2015                                                                    
and sections of the FY16  budget. Co-Chair Kelly deferred to                                                                    
Mr. Armstrong.                                                                                                                  
                                                                                                                                
2:20:23 PM                                                                                                                    
                                                                                                                                
JAMES ARMSTRONG,  STAFF, SENATOR  PETE KELLY,  thanked Megan                                                                    
Wallace and David  Teal for their work on  budget. He stated                                                                    
that  there  was  a  one-page  document  that  outlined  the                                                                    
current  budget  (copy  on  file).  The  bill  restores  the                                                                    
vetoes,  so  SB  2001 duplicated  the  Conference  Committee                                                                    
version.  The   bill  reinstated  intent   and  conditioning                                                                    
language as appropriate, and there  were no new additions to                                                                    
the  bill.  The  language  section  contained  eight  items:                                                                    
tourism  marketing match;  capitalized  the Disaster  Relief                                                                    
Fund; restored the oil and  gas tax credits; capitalized the                                                                    
public  education  fund   with  Alaska  Gasline  Development                                                                    
Corporation  (AGDC)   funds;  repealed  and   restored  K-12                                                                    
funding to  the HB  72 level; offset  any reduction  in AGDC                                                                    
and  7A;  capitalized  the  school  construction  fund;  and                                                                    
provided the State-assisted payment  to retirement. The bill                                                                    
also  provided for  the  CBR  provisions for  super-majority                                                                    
votes  in  Section  17c  of  the  Alaska  Constitution.  The                                                                    
section  offered and  additional opportunity  for access  to                                                                    
the reserve  fund. Section 9  repeated language from  HB 72,                                                                    
related  to  the use  of  the  Higher  Education Fund  as  a                                                                    
"backstop" in FY 15.                                                                                                            
                                                                                                                                
Co-Chair  Kelly  wondered if  Mr.  Teal  had any  additional                                                                    
comments.                                                                                                                       
                                                                                                                                
2:22:48 PM                                                                                                                    
                                                                                                                                
DAVID TEAL,  DIRECTOR, LEGISLATIVE FINANCE  DIVISION, stated                                                                    
that Mr. Armstrong had explained  the separate pieces of the                                                                    
bill. He  restated that SB 2001  was the exact same  bill as                                                                    
the Conference Committee version of the operating budget.                                                                       
                                                                                                                                
Mr.   Armstrong  furthered   that  there   was  a   two-page                                                                    
spreadsheet  (copy on  file) that  displayed the  management                                                                    
plan; the  Conference Committee summary; the  enacted items;                                                                    
and the special session operating budget.                                                                                       
                                                                                                                                
Vice-Chair  Micciche surmised  that the  enacted budget  was                                                                    
$1.9  billion with  a remaining  unfunded  budget of  $2.135                                                                    
million.  Mr. Armstrong agreed.                                                                                                 
                                                                                                                                
Vice-Chair  Micciche announced  that the  Senate had  funded                                                                    
the proposed budget with a three-quarter vote.                                                                                  
                                                                                                                                
Senator  Dunleavy  asked for  a  restatement  of the  budget                                                                    
funds.  Mr. Armstrong  replied that  the enacted  budget was                                                                    
displayed in the third column of the spreadsheet.                                                                               
                                                                                                                                
Senator  Dunleavy  announced  that the  enacted  budget  was                                                                    
$1.923 billion.  Mr. Armstrong agreed. He  furthered that SB
2001 showed a funding total of $2.135 billion.                                                                                  
                                                                                                                                
2:26:12 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:27:25 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
2:27:29 PM                                                                                                                    
                                                                                                                                
PAT  PITNEY,  DIRECTOR,  OFFICE OF  MANAGEMENT  AND  BUDGET,                                                                    
OFFICE OF THE  GOVERNOR, remarked that the  bill would bring                                                                    
the  conference  committee  version  to  consideration.  She                                                                    
stated  that  the  bill  did   not  include  the  additional                                                                    
provisions from  the most  recent previous  special session.                                                                    
She agreed with the statements from Mr. Armstrong.                                                                              
                                                                                                                                
Senator Olson wondered if there  were any changes that would                                                                    
cause  problems in  the administration.  Ms. Pitney  replied                                                                    
that there  was a  submitted $5  billion spending  plan, but                                                                    
only  $2  billion worth  of  revenue.  She stated  that  the                                                                    
administration   felt   that   there  were   some   damaging                                                                    
reductions  than what  was anticipated.  She explained  that                                                                    
the  administration expected  that the  reductions would  be                                                                    
conducted on  a multi-year  approach. She stressed  that the                                                                    
administration's  priority was  a  fully-funded budget,  and                                                                    
understood that there would be some compromise.                                                                                 
                                                                                                                                
Co-Chair Kelly discussed housekeeping.                                                                                          
                                                                                                                                
Vice-Chair  Micciche  stressed  that  the  Senate  passed  a                                                                    
budget in the regular session.                                                                                                  
                                                                                                                                
Co-Chair Kelly  explained that the  special session  did not                                                                    
follow the  regular rules of  the legislature.  He explained                                                                    
that there  were some negotiations and  agreements that were                                                                    
required before any  meetings would be held.  He agreed with                                                                    
the statements from Vice-Chair Micciche.                                                                                        
                                                                                                                                
SB  2001  was  HEARD  and  HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
2:35:50 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 2:35 p.m.                                                                                          

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