Legislature(1993 - 1994)
01/19/1994 09:00 AM Senate FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
January 19, 1994
9:00 a.m.
TAPES
SFC-94, #5 Side 1 (000-end)
SFC-94, #5 Side 2 (end-000)
SFC-94, #7 Side 1 (000-450)
CALL TO ORDER
Senator Steve Frank, Co-chair, convened the meeting at
approximately 9:00 a.m.
PRESENT
In addition to Co-chair Frank, Senators Sharp, Rieger, and
Kerttula were present. Co-chair Pearce, Senators Jacko and
Kelly did not attend.
ALSO ATTENDING: Senator Randy Phillips; Nancy Bear Usera,
Commissioner, Department of Administration; Darrell
Rexwinkel, Commissioner, Department of Revenue; Dan Spencer,
Budget Analyst, Office of Management & Budget; Mike Greany,
Director, Legislative Finance Division; and aides to
committee members and other members of the legislature.
SUMMARY INFORMATION
HB 370 - APPROP: FY 95 OPERATING AND LOAN BUDGET
A presentation was made by Commissioner Nancy Bear
Usera, Department of Administration.
A presentation was also made by Commissioner Darrel
Rexwinkel, Department of Revenue.
The overview by the Department of Community & Regional
Affairs was canceled and will be rescheduled.
DEPARTMENT OF ADMINISTRATION OVERVIEW
CO-CHAIR FRANK invited Commissioner Nancy Bear Usera to join
the members at the committee table and proceed with the
department presentation.
COMMISSIONER USERA said that her presentation would be
brief. She would like to focus on a few budget priorities
and would respond to any questions the committee might have.
She provided the committee with a handout titled "State of
Alaska, Department of Administration, FY 95 Budget Overview"
(copy on file).
Turning to page 5, Ms. Usera said that some additions had
been made to the department since last year. She went on to
explain that the commissioner's office is comprised of one
special assistant, two deputy commissioners, and the
Division of Administrative Services which reports directly
to her. One of the deputy commissioners is in charge of
operations and services state agencies which include
finance, general services, personnel, retirement & benefits,
risk management and information services. Because of the
close association with the telecommunications function,
public broadcasting is also included on that side. The
public services are ones that go directly to the Alaskans.
This deputy commissioner is located in Anchorage because of
the population base being served which includes the Division
of Senior Services (created as a result of the combining of
Pioneer Benefits and the Older Alaskans Commissioner),
Public Defender Agency, Office of Public Advocacy, Public
Offices Commission, and the Permanency Planning Board.
On page 7, Ms Usera said the pie chart illustrates the fact
that the Department of Administration comprises 8 percent of
the total state operating budget for general funds. That 8
percent breaks down as follows: 47 percent for grants to
individuals and non-profits, 28 percent for direct services
to Alaskans, 15 percent for leasing, and 10 percent for core
operations. On page 8, a bar chart translates into real
dollars how most overhead agency costs have gone down
significantly except the primary formula program which
include longevity bonus, and senior services administration.
On page 8, a spreadsheet shows a five-year real dollar
operating budget comparison.
SENATOR PHILLIPS asked Ms. Usera why the Longevity Bonus had
increased from $73.4 to $73.7. She answered that the phase
out went into effect this year but FY95 growth of the
program had significantly slowed. A real reduction will not
be seen for three years. She asked the committee to turn to
the chart on page 10 and 11 which is in nominal dollars.
Even by these standards, she felt the growth was where it
was expected to be in the formula programs and the operating
dollars had been kept down to a maintenance budget for the
last three years. She felt page 11 would be of most
interest to the committee in comparing FY94 authorized
budget with the FY95 budget. She pointed out that the FY94
authorized column did not include supplements. She said
supplementals had been requested in Longevity Bonus, Leasing
& Facilities, Public Defender, Office of Public Advocacy and
Personnel.
Discussion followed between Ms. Usera, Senators Frank,
Rieger, and Phillips regarding the supplemental for the
Longevity Bonus. Ms. Usera said that there is always some
adjustment on an annual basis, which does include new
applicants. Page 107 provides a projection for the
Longevity Bonus Program as of January 2, 1994. Senator
Kerttula voiced his concern that the state may be open for
lawsuits because of the new stair-stepping program. Ms.
Usera said that this was not entered into lightly but the
administration felt that the phase-out program would hold up
in court. Senator Kerttula again reiterated that he hoped
there was good legal counsel to defend this legislation as
he felt it was a conspiracy to end the program.
Senator Phillips asked for information on the Pioneer Homes.
Ms. Usera said that a 1992 ruling said that the residency
requirement for the Pioneer Homes was unconstitutional. The
administration decided not to contest the ruling and just
buy time. In a year and half, there was another law suit
pending. At this point, the Dept of Law began to look for a
method where preference can be shown to long-time Alaskans
and for people who are in need of the Pioneers Home. The
Governor felt that managing the waiting list for this
program might be a better way to allocate this resource for
Alaskans in an equitable fashion. Senator Phillips asked if
the waiting time on the list was approximately 2 years. Ms.
Usera said residency in the Pioneer Home has changed
significantly over the past 5-7 years. The average entrance
age for Alaskans is 82 years old, the average age of
residents in the home is 84 years old, and the average stay
is 4.4 years. She pointed out that other programs like
senior housing apartments, and senior centers have filled
the need of congregate housing. The Pioneer Home residents
today have special needs that cannot be filled anywhere
else. About 90 percent of the people have some form of
ADRD, which includes alzheimer's disease. She said that if
a person is in need of nursing care and only wants to be
admitted to a single home, they would have a longer wait
because they have narrowed their options. If a person is
willing to go to any of the homes, the wait is much shorter.
She said that about 150 people a year are served off of the
waiting list. Today, the list consists of approximately 250
people.
In answer to Co-chair Frank, Ms. Usera pointed out that it
was her understanding that seniors today prefer to live
independently as possible, as long as possible. She agreed
that many factors have caused the evolution in the Pioneer
Home. A big factor is that the state is providing services
on the lower end, and going into an institution is one of
the last options a senior citizen chooses.
Senator Kerttula added that the longevity bonus and the tax
break allows seniors to stay in their own accommodations.
He felt those two key factors kept them out of Pioneer
Homes. He said that if it would not have been for those two
benefits, the Pioneer Home population would be much higher.
Senator Kerttula urged legislation be supported to allow a
senior a three-time drop-back off the Pioneer Home list.
Ms. Usera agreed that a statute would be stronger than a
resolution, but she said that as the list is managed today,
seniors are given three opportunities to come into the home
before they are bumped to the bottom. The program is
designed and managed to keep as many beds filled as possible
at any given time. She pointed out that the more
complicated the list management becomes, the longer it could
take to fill a vacancy.
Senator Sharp said he was encouraged by his conversation
with the Department of Law and some of the legislation
suggested regarding equitable "bumping" on the list. He
felt strongly that the list of 36 people that signed up in
July should not be incorporated with the existing list of
people that did abide by regulations. The last thing he
wanted to see was someone forced to enter the Pioneer Home
for fear of losing his/her place on the list. He said there
were a lot of hard feelings regarding this issue and that
the state was leaving itself open for lawsuits. Ms. Usera
agreed but reminded the committee that their first
obligation was to continue good care for the 600 seniors in
the Pioneer Home today. She also felt that seniors were
uncomfortable with change, and are vulnerable because they
have few options to change their lifestyle. They need to
know that they will continue to receive quality care.
Senator Kerttula said that preceding Ms. Usera's time, there
was a misunderstanding from a memo by the administration and
the residents of the Pioneer Home were crying and packing
their bags. He did not want the seniors upset by such
rhetoric and was distressed over such occurrences. He also
wanted to know who was monitoring the contract food
programs. He hoped the administration was monitoring it all
times. Ms. Usera said the Pioneer Home Advisory Board was
comprised of seniors and they monitored those sorts of
things. She felt there were enough checks and balances in
the system that she would hear if anything was wrong.
Ms. Usera continued with page 11 and said that there were a
few increments she would like to discuss. Budget priorities
were shown on pages 12 and 13 for the Dept of
Administration. She pointed out that in order to achieve
significant savings in efficiencies throughout state
government, adequate resources have to be provided to the
policy development and the implementation of procedures that
are going to achieve statewide savings. She said those
opportunities were in centralized divisions, finance,
personnel and general services. She believed there were
opportunities to save money in government but not unless
necessary money was spent necessary to support the systems
that can derive the savings. At some point, the state has
to say that the resources are not there to do the job to
protect the state from risk and liability. How much risk is
the state willing to take on in terms of the core government
functions because each of these programs have an extreme
amount of liability associated with the non-performance for
their duties? Ms. Usera said that page 14 illustrated the
increment requests for these core areas. She also said that
she also wanted to point out the real losses, such as
purchasing pioneer home supplies or renewing leases without
competitive bids because of the lack of an RFP. She
believed that the primary mission was the economical
delivery of state services and that could best be done by
centralized policy development and de-centralized
implementation requiring monitoring and training.
Senator Phillips asked the committee to look at the Alaska
Public Broadcasting Commission. He said it had been brought
to his attention that money had been spent on video
productions that have been competing with the private sector
at below market value. Co-chair Frank concurred with
Senator Phillips' concerns.
Ms. Usera reiterated that funding priorities were in the
core government services. There was significant savings to
be achieved but many departments were bare bones and unable
to keep up to help departments operate efficiently.
Discussion was held by Ms. Usera and the committee regarding
the special issues in the FY95 budget priority report on
page 15 as follows: Office of Public Advocacy and Public
Defenders Agency funding, status of labor contract
negotiations, consolidation of Senior Services-94 proposals,
Pioneers' Homes residency and rate structure, Longevity
Bonus phase out, lease management, satellite interconnect
update, and Permanency Planning Board model program.
DEPARTMENT OF REVENUE OVERVIEW
Co-chair Frank then invited Commissioner Darrel Rexwinkel to
join the members at the committee table and proceed with the
department presentation.
Log notes of the meeting, handouts distributed by the
departments, and tape recordings of the meeting are on file
in the office of the Senate Finance Committee Secretary,
Room 520, State Capitol Building, Juneau, Alaska (465-4935)
and may be obtained through that office or the Legislative
Finance Division, P.O. Box 113200, Juneau, Alaska 99811-3200
(465-3795).
ADJOURNMENT
The meeting was adjourned at approximately 11:00 a.m.
| Document Name | Date/Time | Subjects |
|---|