Legislature(2017 - 2018)SENATE FINANCE 532

04/05/2018 01:30 PM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Meeting Postponed to 2:30 p.m. --
+ HB 286 APPROP: OPERATING BUDGET/LOANS/FUNDS TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled: TELECONFERENCED
+= HB 287 APPROP: PUPIL TRANSPORTATION; EDUCATION TELECONFERENCED
Heard & Held
+ HB 285 APPROP: MENTAL HEALTH BUDGET TELECONFERENCED
Heard & Held
                 SENATE FINANCE COMMITTEE                                                                                       
                       April 5, 2018                                                                                            
                         2:37 p.m.                                                                                              
                                                                                                                                
2:37:15 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair MacKinnon called the Senate Finance Committee                                                                          
meeting to order at 2:37 p.m.                                                                                                   
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Anna MacKinnon, Co-Chair                                                                                                
Senator Click Bishop, Vice-Chair                                                                                                
Senator Peter Micciche                                                                                                          
Senator Gary Stevens                                                                                                            
Senator Natasha von Imhof                                                                                                       
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Donny Olson                                                                                                             
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Pete Ecklund, Staff, Senator Lyman Hoffman; Angela Rodell,                                                                      
Executive Director, Alaska Permanent Fund Corporation; Mike                                                                     
Barnhill, Deputy Commissioner, Department of Revenue.                                                                           
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
CSHB 285(FIN)                                                                                                                   
          APPROP: MENTAL HEALTH BUDGET                                                                                          
                                                                                                                                
          CSHB 285(FIN) was HEARD and HELD in committee for                                                                     
          further consideration.                                                                                                
                                                                                                                                
CSHB 286(FIN) am(brf sup maj fld)(efd fld)                                                                                      
          APPROP: OPERATING BUDGET/LOANS/FUNDS                                                                                  
                                                                                                                                
          CSHB 286(FIN) am(brf sup maj fld)(efd fld)was                                                                         
          HEARD and HELD in committee for further                                                                               
          consideration.                                                                                                        
                                                                                                                                
HB 287(brf sup maj fld)                                                                                                         
          APPROP: PUPIL TRANSPORTATION; EDUCATION                                                                               
                                                                                                                                
          HB 287(brf sup maj fld) was HEARD and HELD in                                                                         
          committee for further consideration.                                                                                  
                                                                                                                                
HOUSE BILL NO. 287(brf sup maj fld)                                                                                           
                                                                                                                                
     "An Act making appropriations for public education and                                                                     
     transportation of students; and providing for an                                                                           
     effective date."                                                                                                           
                                                                                                                                
2:38:02 PM                                                                                                                    
                                                                                                                                
Vice-Chair   Bishop  MOVED   to  ADOPT   proposed  committee                                                                    
substitute  for HB  287,  Work  Draft 30-LS1229\R  (Wallace,                                                                    
3/23/18).                                                                                                                       
                                                                                                                                
Co-Chair MacKinnon OBJECTED for discussion.                                                                                     
                                                                                                                                
2:38:33 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:40:06 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair  MacKinnon  relayed  that the  House  had  proposed                                                                    
early funding  for education  and transportation  The Senate                                                                    
agreed that  instability of educators,  superintendents, and                                                                    
students that  were trying to learn.  The proposed Committee                                                                    
Substitute (CS) addressed that issue.                                                                                           
                                                                                                                                
Co-Chair  Hoffman thanked  the  House for  its  work on  the                                                                    
bill. He noted that the committee  had not taken up the bill                                                                    
until it had received the operating budget.                                                                                     
                                                                                                                                
2:41:33 PM                                                                                                                    
                                                                                                                                
PETE ECKLUND,  STAFF, SENATOR  LYMAN HOFFMAN,  discussed the                                                                    
proposed CS.                                                                                                                    
                                                                                                                                
Mr.  Ecklund  looked  at  page  2,  Section  1,  which  were                                                                    
elements  of K-12  aid that  were held  in the  other body's                                                                    
version of the bill. He stated  that it was aid to different                                                                    
school districts,  and to Mt.  Edgecumbe. He  announced that                                                                    
pages 3 and 4 were  the funding sources contained in Section                                                                    
1.  He shared  that page  5, Section  4 was  the legislative                                                                    
intent.  He  paraphrased  that  the  intent  instructed  the                                                                    
Department  of   Revenue  (DOR)   and  the   Permanent  Fund                                                                    
Corporation to  work together to utilize  the constitutional                                                                    
budget reserve  (CBR) borrowing  language. The  language was                                                                    
in the FY  18 budget, and would appear in  the FY 19 budget.                                                                    
The  language  allowed  the  CBR to  be  used  for  cashflow                                                                    
purposes  in  anticipation  of  general  fund  revenue.  The                                                                    
intent was for the permanent  fund to make cash transfers to                                                                    
the  general   fund  in  the   most  prudent   way  possible                                                                    
throughout t the fiscal year.  He looked at line 11, Section                                                                    
5, which  contained a  5.25 percent  draw from  the Earnings                                                                    
Reserve  Account   (ERA).  He  explained  that   it  was  an                                                                    
unstructured  draw, because  there  was  no current  statute                                                                    
that would  instruct the  draw. He  remarked that  there was                                                                    
another bill,  SB 26,  which had a  5.25 percent  draw. That                                                                    
bill  would have  taken effect  in  FY 18,  so the  language                                                                    
reflected the language in SB  26. He remarked that there was                                                                    
a  $726 million  dividend paid  in  the prior  year, so  the                                                                    
language took  a 5.25  percent from  the ERA,  and subtracts                                                                    
the  dividend payment.  The  remainder  was $1.792  billion,                                                                    
which went to  the general fund in FY 18.  That money became                                                                    
FY 18 revenue.                                                                                                                  
                                                                                                                                
2:45:22 PM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon  asked  if  the budget  from  the  House                                                                    
contained a percentage draw.                                                                                                    
                                                                                                                                
Mr. Ecklund answered in the  affirmative, and specified that                                                                    
that the effective rate was a 4.21 percent effective rate.                                                                      
                                                                                                                                
Mr. Ecklund  drew attention to  Line 20 in Section  6, which                                                                    
was  fund capitalization  for K-12  Base Student  Allocation                                                                    
(BSA) funding  for FY 19.  He stated that $1.89  billion was                                                                    
fully funding  the BSA for  FY 19.  He looked at  Section B,                                                                    
which  was  $78.1  million  for  transportation  FY  19.  He                                                                    
remarked that  Section C  was fully funding  the BSA  for FY                                                                    
20.   He   shared  that   Section   D   was  fully   funding                                                                    
transportation for FY  20. He remarked that  page 6, Section                                                                    
7  was  a standard  lapse.  He  stated  that Section  8  was                                                                    
contingency, which  referred to Section  6 that held  the FY                                                                    
20   appropriations   for    K-12   education   and   people                                                                    
transportation.  Those two  sections  would  go into  effect                                                                    
upon the enactment of SB 26.  He shared that Sections 9, 10,                                                                    
and 11 were effective dates.                                                                                                    
                                                                                                                                
                                                                                                                                
Co-Chair MacKinnon  WITHDREW her  OBJECTION. There  being NO                                                                    
further  OBJECTION, the  proposed  committee substitute  was                                                                    
ADOPTED.                                                                                                                        
                                                                                                                                
Co-Chair  MacKinnon stated  that  Alaskans wanted  assurance                                                                    
that there  was protection for  the corpus of  the permanent                                                                    
fund. She asked for comments on the bill.                                                                                       
                                                                                                                                
ANGELA  RODELL, EXECUTIVE  DIRECTOR,  ALASKA PERMANENT  FUND                                                                    
CORPORATION,  stated  that  the CS  being  considered  would                                                                    
protect  the corpus  of the  fund. She  emphasized that  the                                                                    
corpus of  the fund was protected  constitutionally, and the                                                                    
bill  did not  touch  the  corpus of  the  fund. She  shared                                                                    
observations  that   generated  questions  for   the  Alaska                                                                    
Permanent Fund  Corporation (APFC). She stressed  that there                                                                    
needed to  be a statutory  framework. She remarked  that the                                                                    
fund should  not be  placed in  a political  discussion, but                                                                    
rather  provide  a  working  framework  to  plan  each  year                                                                    
accordingly. She  stated that  work would  be done  with the                                                                    
treasury  to plan  the draws  over the  course of  year. She                                                                    
encouraged the body to continue  to work. She referenced the                                                                    
contingency language.                                                                                                           
                                                                                                                                
Co-Chair  Hoffman asked  if  it  was fair  to  say that  the                                                                    
corporation  was  concerned   about  potential  unstructured                                                                    
draws that might compromise the earnings.                                                                                       
                                                                                                                                
Ms. Rodell answered in the affirmative.                                                                                         
                                                                                                                                
2:51:33 PM                                                                                                                    
                                                                                                                                
MIKE BARNHILL,  DEPUTY COMMISSIONER, DEPARTMENT  OF REVENUE,                                                                    
thought it  seemed as though  the salient provisions  of the                                                                    
bill  were  set  out  in  Section 4,  which  called  on  the                                                                    
department  to use  the CBR  as  a backstop  to the  general                                                                    
fund.  He stressed  that there  would be  assistance to  the                                                                    
permanent  fund in  maximizing  its  investment revenue.  He                                                                    
stated that,  presently, DOR  worked internally  to schedule                                                                    
transfers from  the CBR into the  GF periodically throughout                                                                    
the  year. There  was  a  model to  predict  when the  daily                                                                    
balance of the GF would go  below $400 million, and that was                                                                    
the moment  to draw from the  CBR. That model would  be used                                                                    
at the  end of FY  18 to assist  in providing a  schedule to                                                                    
the  permanent  fund  appropriately  to  hopefully  maximize                                                                    
investment revenue.                                                                                                             
                                                                                                                                
2:53:39 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  informed that  she would be  setting the                                                                    
bill aside and taking it up  again the following day and the                                                                    
committee would be hearing public testimony.                                                                                    
                                                                                                                                
Co-Chair MacKinnon handed the gavel to Co-Chair Hoffman.                                                                        
                                                                                                                                
2:54:10 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:58:23 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair MacKinnon  discussed forward-funding  of education.                                                                    
The  house   had  provided  a  separate   bill  for  funding                                                                    
education. The  bill was being considered  separately at the                                                                    
House's request.                                                                                                                
                                                                                                                                
HB  287  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
CS FOR HOUSE BILL NO. 286(FIN) am(brf sup maj fld)(efd fld)                                                                   
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     loan  program  expenses  of state  government  and  for                                                                    
     certain   programs;    capitalizing   funds;   amending                                                                    
     appropriations;      and       making      supplemental                                                                    
     appropriations."                                                                                                           
                                                                                                                                
2:59:48 PM                                                                                                                    
                                                                                                                                
Vice-Chair   Bishop  MOVED   to  ADOPT   proposed  committee                                                                    
substitute for  CSHB 286,  Work Draft  30-GH2564\N (Wallace,                                                                    
4/4/18).                                                                                                                        
                                                                                                                                
Co-Chair Hoffman OBJECTED for discussion.                                                                                       
                                                                                                                                
Mr.  Ecklund  listed  documents   that  were  available  for                                                                    
reference. He  drew attention to  a booklet entitled  "FY 19                                                                    
Operating  Budget Subcommittee  Closeout Narratives,"  which                                                                    
showed  a  synopsis  of  what  happened  in  Senate  Finance                                                                    
Subcommittees  (copy  on  file).  He  stated  he  would  not                                                                    
address the  booklet, but would address  language changes to                                                                    
the bill. He stated there  was a report from the Legislative                                                                    
Finance   Division  (LFD)   entitled  "2018   Legislature  -                                                                    
Operating Budget,  Agency Summary - Senate  Structure" (copy                                                                    
on file).                                                                                                                       
                                                                                                                                
Mr. Ecklund informed that the  committee had removed funding                                                                    
items for  K-12 education and pupil  transportation from the                                                                    
bill and  placed them in HB  287. He stated that  the change                                                                    
was  reflected  in  the  reports in  order  to  compare  the                                                                    
Senate's proposed total budget to  that of the House and the                                                                    
governor.                                                                                                                       
                                                                                                                                
Co-Chair Hoffman  pointed out  that subcommittee  chairs had                                                                    
been having hearings  and had closed out  reports earlier in                                                                    
the week,  which were incorporated in  the booklet mentioned                                                                    
by Mr. Ecklund.                                                                                                                 
                                                                                                                                
Mr.  Ecklund  furthered  that once  the  proposed  Committee                                                                    
Substitute (CS) was  adopted, LFD would provide  a myriad of                                                                    
reports  for members  and the  public to  compare the  CS to                                                                    
earlier versions of  the bill. He stated he  would address a                                                                    
4-page  document   that  listed  all  the   changes  from  a                                                                    
previously adopted  CS [which he  referred to as  "CS Zero"]                                                                    
from the Senate version of  the bill [CSSB 144(FIN), adopted                                                                    
February  9,  2018].  The  bill  rearranged  the  governor's                                                                    
budget into  the format  that was preferred  by LFD  and the                                                                    
Legislative Legal Department.                                                                                                   
                                                                                                                                
Mr. Ecklund detailed  that the CS contained  $5.5 billion of                                                                    
UGF, which included  a dividend. He remarked  that there was                                                                    
$868 million  of DGF; $1.428  million of other  state funds;                                                                    
$2.45  billion   of  federal  funds;  which   totaled  $10.2                                                                    
billion.                                                                                                                        
                                                                                                                                
Co-Chair Hoffman asked  for Mr. Ecklund to  state the amount                                                                    
for the amount of the dividend in the bill.                                                                                     
                                                                                                                                
Mr. Ecklund  replied that the individual  dividend was $1600                                                                    
per individual.                                                                                                                 
                                                                                                                                
3:04:28 PM                                                                                                                    
                                                                                                                                
Mr. Ecklund read from the  document "Summary of Changes from                                                                    
the CS SB 144(FIN) and SCS CSHB 286(FIN)" (copy on file):                                                                       
                                                                                                                                
     Sections 1-3:                                                                                                              
     Incorporate all  changes adopted by the  Senate Finance                                                                    
     Subcommittees, with the exception  that all funding for                                                                    
     the Department of Education  and Early Development that                                                                    
     is  included in  SCS HB287  has been  removed from  the                                                                    
     committee substitute.                                                                                                      
                                                                                                                                
     Section 4(a),  page 53,  lines 1-3:  Discourages future                                                                    
     supplemental  requests  by  adding  legislative  intent                                                                    
     stating that  the amounts appropriated in  the bill are                                                                    
     the full amounts that will be appropriated for FY19.                                                                       
                                                                                                                                
     Section  7,  page  54, lines  16-24:  Revises  language                                                                    
     submitted by the Governor  regarding the declaration of                                                                    
     the  FY19  Alaska  Industrial  Development  and  Export                                                                    
     Authority  dividend. Similar  language  was adopted  by                                                                    
     the legislature last year.                                                                                                 
                                                                                                                                
     Section 8 (Permanent Fund), pages 54-55:                                                                                   
     Subsections (a)  and (b) regarding royalty  deposits to                                                                    
     fund  corpus  and  earnings  deposits  to  the  capital                                                                    
     income fund remain as proposed.                                                                                            
     Subsection  (c) retains  the Governor's  proposed 5.25%                                                                    
     payout  from  the  Earnings   Reserve  Account  to  the                                                                    
     general  fund but  corrects the  amount  of the  payout                                                                    
     ($2,722,842,518).                                                                                                          
     Subsection   (d)  modifies   the  Governor's   proposed                                                                    
     appropriation  to the  dividend  fundwas  $819  million                                                                    
     for an  estimated dividend  of $1,216,  and is  now the                                                                    
     amount necessary  to pay  a $1,600  dividend (estimated                                                                    
     to be $1,023,847,200).                                                                                                     
     The committee substitute also                                                                                              
     1.   Eliminates   the  Governor's   request  of   $1.45                                                                    
     billion  from  the  Earnings  Reserve  Account  to  the                                                                    
     Alaska  Permanent   fund  for   FY16,  FY17   and  FY18                                                                    
     inflation proofing.                                                                                                        
     2.   Eliminates  the Governor's  appropriation of  $943                                                                    
     million  from  the  Earnings  Reserve  Account  to  the                                                                    
    Alaska Permanent fund for FY19 inflation proofing.                                                                          
     3.   Moves  the Governor's  request  to fund  operating                                                                    
     costs  of  the  Alaska Permanent  Fund  Corporation  to                                                                    
     section 1.                                                                                                                 
                                                                                                                                
     Section 9(f) and (g), page  56, lines 19-26: replaces a                                                                    
     Governor's Department  of Administration request  for a                                                                    
     single  open-ended  appropriation   with  two  distinct                                                                    
     sections.                                                                                                                  
     1.   Appropriates  an amount  necessary, not  to exceed                                                                    
     $500,000,  from the  general fund  for retirement  plan                                                                    
     sponsor costs (settlor costs).                                                                                             
     2.   Appropriates  the amount  necessary, estimated  to                                                                    
     be  zero, to  cover retirement  system actuarial  costs                                                                    
     associated with bills introduced by the legislature.                                                                       
                                                                                                                                
     The  committee  substitute   eliminates  the  following                                                                    
     Governor's requests:                                                                                                       
     1.   Page    56,    lines    27-29:    Department    of                                                                    
     Administration,     Public     Defender     AgencyFY18                                                                     
     Supplemental  request   of  $453,500  UGF   for  public                                                                    
     defenders.                                                                                                                 
     2.   Page  58,   line  31  and   page  59,   line  1-3:                                                                    
     Department   of  Corrections,   Institution  Director's                                                                    
     Office    FY18 Supplemental request of  $10,447,600 UGF                                                                    
     for facility operations.                                                                                                   
     3.   Page  59, lines  4-6:  Department of  Corrections,                                                                    
     Inmate  Health  Care    FY18  Supplemental  request  of                                                                    
     $10,341,500 UGF for inmate health care costs.                                                                              
     4.   Page 59,  lines 7-11: Department of  Education and                                                                    
     Early  Development,  Mt.  Edgecumbe Boarding  School                                                                       
     Supplemental  multi-year  (FY18  and FY19)  request  of                                                                    
     $400,000 Municipal Capital  Project Matching grant fund                                                                    
     for  maintenance and  operation  of  the Mt.  Edgecumbe                                                                    
     Aquatic Center.                                                                                                            
     5.   Page 59,  lines 12-19:  Department of  Education &                                                                    
     Early    Development,   Executive    Administration                                                                        
     Supplemental  lapse date  extension from  FY18 to  FY19                                                                    
     for funding associated with  the Every Student Succeeds                                                                    
     Act.                                                                                                                       
     6.   Page  59,  lines 30-31  and  page  60, lines  1-4:                                                                    
     Department  of  Health   &  Social  Services,  Medicaid                                                                    
     Services    open-ended FY19 general  fund appropriation                                                                    
     language.                                                                                                                  
     7.   Page 60, lines 5-9:  Department of Health & Social                                                                    
     Services, Medicaid  Services   open-ended  FY19 federal                                                                    
     appropriation language.                                                                                                    
     8.   Page  60,  lines  10-15: Department  of  Health  &                                                                    
     Social  Services, Medicaid  Services    open-ended FY18                                                                    
     Supplemental UGF appropriation language.                                                                                   
     9.   Page  60,  lines  16-21: Department  of  Health  &                                                                    
     Social Services,  Medicaid Services   FY18 Supplemental                                                                    
     request   of  $7,014.0   UGF   for  Children's   Health                                                                    
     Insurance Program.                                                                                                         
     10.  Page  60,  lines  22-24: Department  of  Health  &                                                                    
     Social  Services, Medicaid  Services    open-ended FY18                                                                    
     federal appropriation language.                                                                                            
     11.  Page  60,  lines  25-28: Department  of  Health  &                                                                    
     Social   Services,   Behavioral  Health    Supplemental                                                                    
     multi-year  (FY18-FY21) request  of  $18,000.0 UGF  for                                                                    
     Substance Use Disorder Grants.                                                                                             
     12.  Page 61, lines 23-26  Department of Law, Judgments                                                                    
     & Settlements    FY18 Supplemental request  of $322,000                                                                    
     UGF for payment of judgments and settlements.                                                                              
     13.  Page   61,  lines   27-31:   Department  of   Law,                                                                    
     Judgments   open-ended  FY19 general fund appropriation                                                                    
     language.                                                                                                                  
     14.  Page  62, lines  7-10:  Department  of Military  &                                                                    
     Veterans' Affairs,  Office of  the Commissioner    FY18                                                                    
     Supplemental  request   of  $94,100  UGF  for   a  Base                                                                    
     Realignment and Closure position.                                                                                          
     15.  Page  62, lines  11-15: Department  of Military  &                                                                    
     Veterans' Affairs,  Air Guard Facilities  Maintenance                                                                      
     FY18 Supplemental request of  $221,000 UGF and $663,000                                                                    
     Federal  Receipts  for  maintenance  and  operation  of                                                                    
     eight C-17 aircraft.                                                                                                       
     16.  Page 63, lines  8-11: Department of Transportation                                                                    
     &  Public Facilities     FY18  Supplemental request  of                                                                    
     $350,000 UGF for a Klutina Lake Road Survey.                                                                               
                                                                                                                                
     Section 17(e), page  64, lines 16-31 and  page 65 lines                                                                    
     1-7: Moves  debt service items from  the Constitutional                                                                    
     Budget Reserve section to the  Debt Service section and                                                                    
     funds the appropriations with general funds.                                                                               
                                                                                                                                
     Section 17(h)(14)-(15),  page 67, lines 11-19:  In lieu                                                                    
     of  general funds,  utilizes $12.3  million of  lapsing                                                                    
     general  obligation  bond  authorization to  repay  the                                                                    
     principal of 2013 series B bonds.                                                                                          
                                                                                                                                
     Section 17(m), page  69, lines 29-31 and  page 70 lines                                                                    
     1-7:  Replaces  $17.6  million of  general  funds  with                                                                    
     Alaska Comprehensive Health  Insurance funds for school                                                                    
     debt reimbursement.                                                                                                        
                                                                                                                                
     Sections 18(a),  page 70, lines 13-24:  Amends the FY18                                                                    
     Legislative Budget  and Audit  language to  prevent the                                                                    
     Alaska  Gasline Development  Corporation from  spending                                                                    
     additional designated program receipts.                                                                                    
                                                                                                                                
3:08:42 PM                                                                                                                    
                                                                                                                                
Mr. Ecklund continued reading from the summary of changes                                                                       
document:                                                                                                                       
                                                                                                                                
     Sections  18(b),  page 70,  lines  25-31  and page  71,                                                                    
     lines  1-2:  Amends  the FY19  Legislative  Budget  and                                                                    
     Audit   language   to   prevent  the   Alaska   Gasline                                                                    
     Development   Corporation   from  spending   additional                                                                    
     designated program receipts.                                                                                               
                                                                                                                                
     Section  19(c),  page  71,  lines  23-24:  Replaces  $2                                                                    
     million  of  general  funds with  Alaska  Comprehensive                                                                    
     Health Insurance  funds for  deposit into  the Disaster                                                                    
     Relief Fund.                                                                                                               
                                                                                                                                
     Section  19(f),   page  72,  lines  2-8:   Deposits  an                                                                    
     estimated $184 million ($168  million general funds and                                                                    
     $16  million  Alaska   Comprehensive  Health  Insurance                                                                    
     funds) into the Oil & Gas  Tax Credit fund based on the                                                                    
     statutory calculation.                                                                                                     
                                                                                                                                
     Section  19(g),  page  72,   lines  9-10:  Changes  the                                                                    
     effective   date  of   the  $30   million  Power   Cost                                                                    
     Equalization Endowment fund  deposit into the Community                                                                    
     Assistance fund from FY18 to FY19.                                                                                         
                                                                                                                                
     The  committee  substitute   eliminates  the  following                                                                    
     Governor's requests:                                                                                                       
     1.   Page  72, lines  11-26:  FY19  deposit of  general                                                                    
     funds  into   the  Public   Education  fund   for  K-12                                                                    
     Foundation    Formula    and   Pupil    Transportation.                                                                    
     (Duplicates the deposits proposed in HB287.)                                                                               
     2.   Page  73,  lines  1-3: FY18  and  FY19  open-ended                                                                    
     deposit  of designated  program  receipts collected  by                                                                    
     the  Alaska Gasline  Development  Corporation into  the                                                                    
     AKLNG Fund.                                                                                                                
     3.   Page 73,  lines 4-6: Transfer of  $12 million from                                                                    
     the In-state  Natural Gas Pipeline  fund to  the Alaska                                                                    
     Liquefied Natural Gas Project fund.                                                                                        
                                                                                                                                
     Section  20(c), page  75, lines  9-13: Appropriates  an                                                                    
     amount equal to 50  percent of punitive damages imposed                                                                    
     under AS 09.17.020(j) during FY18  into the Civil Legal                                                                    
     Services fund. The amount is estimated to be $1,000.                                                                       
                                                                                                                                
     Section  20(f),   page  76,  lines  1-2:   Changes  the                                                                    
     effective   date  of   the  $14   million  Power   Cost                                                                    
     Equalization Endowment fund  deposit into the Renewable                                                                    
     Energy fund from FY18 to FY19.                                                                                             
                                                                                                                                
     The  committee  substitute   eliminates  the  following                                                                    
     Governor's request:                                                                                                        
     1.   Page 76,  lines 3-4:  FY18 deposit  of $23,918,200                                                                    
     from the  general fund into  the Alaska  Marine Highway                                                                    
     System fund.                                                                                                               
                                                                                                                                
     Section 21 (Retirement System  Funding), page 77, lines                                                                    
     5-31 and page 78, line 1:                                                                                                  
     1.   Moves   retirement    system   items    from   the                                                                    
     Constitutional   Budget   Reserve    section   to   the                                                                    
     Retirement  System   Funding  section  and   funds  the                                                                    
     appropriations with general funds.                                                                                         
     2.   Eliminates  a  contingent appropriation  requested                                                                    
     by the  Governor reducing retirement  appropriations by                                                                    
     $25.5  million based  on  potential  savings under  the                                                                    
     Medicare Part D Employer Group Waiver Plan.                                                                                
     3.   Adds  intent language  for  the Alaska  Retirement                                                                    
     Management  Board to  consider the  funding ratio  when                                                                    
     making  recommendations for  the Alaska  National Guard                                                                    
     and Alaska Naval Militia retirement system.                                                                                
                                                                                                                                
     Section 23(b), page 79, lines  20-24: Amends the amount                                                                    
     of  shared  taxes  to local  governments  to  the  full                                                                    
     amount  of aviation  fuel tax  or surcharge  collected,                                                                    
     from $100,000 to $182,900.                                                                                                 
                                                                                                                                
     Section 25 (Constitutional  Budget Reserve Fund), pages                                                                    
     80 through 83:                                                                                                             
     1.   Subsection (a) is FY18 reverse sweep language.                                                                        
     2.   Subsection (b) is FY19 deficit filling language.                                                                      
     3.   Subsection  (c) is  FY19 head  room totaling  $100                                                                    
     million.                                                                                                                   
     4.   Subsection  (d)  is  borrowing  language  for  the                                                                    
     general  fund from  the  Constitutional Budget  Reserve                                                                    
     Fund.                                                                                                                      
     5.   Subsection  (e)  identifies  sections  (a)-(c)  as                                                                    
     needing  a ?  vote by  the legislature  in order  to be                                                                    
     effective.                                                                                                                 
                                                                                                                                
     The  document  compare  for the  Constitutional  Budget                                                                    
     Reserve  section reflects  items that  are being  moved                                                                    
     elsewhere  in  the  bill,  not  being  eliminated.  For                                                                    
     example,   debt    service   and    retirement   system                                                                    
     appropriations have  been relocated to  the appropriate                                                                    
     section of the bill.                                                                                                       
                                                                                                                                
     The  committee  substitute   eliminates  the  following                                                                    
     Governor's request:                                                                                                        
     1.   Page 80,  lines 9-13: Use of  the Statutory Budget                                                                    
     Reserve Fund for FY19.                                                                                                     
     2.   Page  81, lines  6-7: The  Governor's request  for                                                                    
     $27  million  to  pay  interest  on  a  debt  financing                                                                    
     mechanism for the  purpose of retiring oil  and gas tax                                                                    
     credit certificates.                                                                                                       
     3.   Page 83, lines 28-31 and  page 84, line 1: Deletes                                                                    
     contingency  language related  to  the Senior  Benefits                                                                    
     Payment Program.                                                                                                           
                                                                                                                                
     Legislative   Legal   Services   made   editorial   and                                                                    
     technical  changes throughout  the  bill  that are  not                                                                    
     included  in  this  list,  including  revising  section                                                                    
     references for  Lapse of  Appropriations, Retroactivity                                                                    
     and Effective Dates.                                                                                                       
                                                                                                                                
3:16:37 PM                                                                                                                    
                                                                                                                                
Co-Chair Hoffman  asked Mr. Ecklund  to review  the document                                                                    
"HB 286 Supporting Document A"  (copy on file). He asked for                                                                    
a comparison of the two versions of the bill.                                                                                   
                                                                                                                                
Mr. Ecklund detailed the columns within the document.                                                                           
                                                                                                                                
Co-Chair  Hoffman  asked Mr.  Ecklund  to  identify why  the                                                                    
Senate number  was substantially higher than  the governor's                                                                    
under statewide items                                                                                                           
                                                                                                                                
Mr. Ecklund  stated that  oil and  gas tax  credits affected                                                                    
that  number. He  remarked that  the governor's  version had                                                                    
$27  million in  anticipation  of  legislation passing.  The                                                                    
other  body's  version  was  $49  million,  and  the  Senate                                                                    
version had  a total of  $184 million of which  $168 million                                                                    
was UGF.                                                                                                                        
                                                                                                                                
Co-Chair Hoffman  asked if the $184  million was statutorily                                                                    
required after the spring forecast.                                                                                             
                                                                                                                                
Mr. Ecklund replied in the affirmative.                                                                                         
                                                                                                                                
Co-Chair  Hoffman  asked  if   the  number  was  before  the                                                                    
forecast.                                                                                                                       
                                                                                                                                
Mr.  Ecklund  believed  that that  the  fall  forecast  $206                                                                    
million.                                                                                                                        
                                                                                                                                
Senator Micciche  clarified that  Mr. Ecklund  had mentioned                                                                    
that  there was  contingency  language  and intent  language                                                                    
that would return the funding as bills pass.                                                                                    
                                                                                                                                
3:20:14 PM                                                                                                                    
                                                                                                                                
Co-Chair  Hoffman WITHDREW  his OBJECTION.   There  being NO                                                                    
OBJECTION, it was so ordered. SCS CSHB286(FIN) was ADOPTED.                                                                     
                                                                                                                                
Co-Chair Hoffman reviewed the  schedule for public testimony                                                                    
the following day.                                                                                                              
                                                                                                                                
Co-Chair Hoffman  thanked the subcommittee chairs  for their                                                                    
work  on the  budget. He  thanked  members for  work on  the                                                                    
budget.                                                                                                                         
                                                                                                                                
CSHB  286  was  HEARD  and HELD  in  committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
CS FOR HOUSE BILL NO. 285(FIN)                                                                                                
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     capital    expenses   of    the   state's    integrated                                                                    
     comprehensive mental health  program; and providing for                                                                    
     an effective date."                                                                                                        
                                                                                                                                
3:23:58 PM                                                                                                                    
                                                                                                                                
Vice-Chair   Bishop  MOVED   to  ADOPT   proposed  committee                                                                    
substitute for  CSHB 285,  Work Draft  30-GH2566\R (Wallace,                                                                    
4/4/18).                                                                                                                        
                                                                                                                                
Co-Chair Hoffman OBJECTED for discussion.                                                                                       
                                                                                                                                
Mr. Ecklund  stated that the  mental health budget  held the                                                                    
programs  funded with  the  Mental  Health Trust  Authorized                                                                    
Receipts.  He shared  that the  general  fund mental  health                                                                    
funds were  removed from the  operating budget, and  were in                                                                    
the  mental  health budget  to  be  tracked accordingly.  He                                                                    
stated  that  all  the  items were  included  in  the  other                                                                    
reports.                                                                                                                        
                                                                                                                                
Co-Chair  Hoffman WITHDREW  his  OBJECTION.  There being  NO                                                                    
further OBJECTION, it was so ordered.                                                                                           
                                                                                                                                
Vice-Chair Bishop thanked those responsible for their work                                                                      
on the budget.                                                                                                                  
                                                                                                                                
Co-Chair MacKinnon thanked the committee, and discussed                                                                         
housekeeping.                                                                                                                   
                                                                                                                                
CSHB 285 was HEARD and HELD in committee for further                                                                            
consideration.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
3:26:22 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:26 p.m.                                                                                          
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
HB 287 Resolution Kenai.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 287 Support Spangler.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 287 Sen FIN 2-23-2018.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 287 Letters of Support.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 287 Sponsor Statement.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 287 Summary of Changes.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 287 Support Letter.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 287 SCSHB 287 work draft version R.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 286 Numbers and Language Spreadsheet Supporting Document A.pdf SFIN 4/5/2018 1:30:00 PM
HB 286
HB 286 Summary of Changes version N.pdf SFIN 4/5/2018 1:30:00 PM
HB 286
HB 287 Supporting Document A.pdf SFIN 4/5/2018 1:30:00 PM
HB 287
HB 286 SCSforCSHB work draft version N.pdf SFIN 4/5/2018 1:30:00 PM
HB 286
HB 285 SCSforCSHB 285 work draft version R.pdf SFIN 4/5/2018 1:30:00 PM
HB 285