Legislature(1995 - 1996)
04/19/1995 12:20 PM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
April 19, 1995
12:20 p.m.
TAPES
SFC-95, #31, Side 1 (052-end)
SFC-95, #31, Side 2 (575-end)
SFC-95, #37, Side 1 and 2
SFC-95, #39, Side 1 and 2
SFC-95, #41, Side 1 and 2
SFC-95, #43, Side 1 and 2
SFC-95, #45, Side 1 and 2
SFC-95, #47, Side 1 and 2
SFC-95, #49, Side 1 (000-426)
CALL TO ORDER
Senator Steve Frank, Co-chairman, convened the meeting at
approximately 12:20 p.m.
PRESENT
In addition to Co-chairmen Frank and Halford, Senators
Donley, Sharp, and Zharoff were present. Senators Phillips
and Rieger arrived soon after the meeting began.
ALSO ATTENDING: Senate President Drue Pearce; Senator
Adams; Senator Duncan; Senator Hoffman; Senator Lincoln;
Former Lt. Governor Red Boucher; Margaret Pugh,
Commissioner, Dept. of Corrections; Karen Perdue,
Commissioner, Dept. of Health and Social Services; Gene
Burden, Commissioner, Dept. of Environmental Conservation;
Frank Rue, Commissioner, Dept. of Fish and Game; Barbara
Ritchie, Deputy Attorney General, Civil Division, Dept. of
Law; Del Smith, Deputy Commissioner, Dept. of Public Safety;
Ed Flanagan, Deputy Commissioner, Dept. of Labor; Laddie
Shaw, Executive Director, Alaska Police Standards Council,
Dept. of Public Safety; Annalee McConnell, Director, Office
of Management and Budget; Nancy Slagle, Director of Budget
Review, Office of Management and Budget; Remond Henderson,
Director, Division of Administrative Services, Dept. of
Community and Regional Affairs; Mary Lou Burton, University
of Alaska; Ron Lind, Director, Division of Administrative
Services; Dept. of Transportation and Public Facilities;
Mark Badger, Director, Division of Information Services,
Dept. of Administration; Douglas Samimi-Moore, Executive
Director, Alaska Public Broadcasting Commission, Dept. of
Administration; Guy Bell, Director, Division of
Administrative Services, Dept. of Commerce and Economic
Development; Art Schheunemann, Executive Director, Alaska
Seafood Marketing Institute, Dept. of Commerce and Economic
Development; Geron Bruce, Legislative Liaison, Dept. of Fish
and Game; Kevin Brooks, Director, Division of Administrative
Services, Dept. of Fish and Game; Arbe Williams, Director,
Division of Administrative Services, Dept. of Labor; Jeff
Morrison, Director, Administrative and Support Services,
Dept. of Military & Veterans Affairs; Jeff Hartman,
Assistant Director, Division of Support Services, Dept. of
Natural Resources; Joe McCormick, Executive Director,
Postsecondary Education Commission, Dept. of Education;
Karen Rehfeld, Director, Administrative Services, Dept. of
Education; Art Snowden, Administrative Director, Alaska
Court System; Sharon Barton, Director, Division of
Administrative Services, Dept. of Administration; Alison
Elgee, Deputy Commissioner, Dept. of Administration; John
Newstrom, Southeast Media Consortium; Mike Greany, Director,
Legislative Finance Division; Kathryn Daughhetee, Fred
Fisher, Dana LaTour, Susan Taylor, Virginia Stonkus, and
Jetta Whittaker, fiscal analysts, Legislative Finance
Division; Dave Skidmore, aide to Senator Frank; Jerry
Burnett, aide to Senator Phillips; and other aides to
committee members and other members of the legislature.
SUMMARY INFORMATION
HB 100 - APPROP: FY 96 OPERATING & LOAN BUDGET
The subcommittee budget for the Dept. of Labor was
moved and adopted. Amendments 2 through 97 and
front sections of the budget were reviewed and
acted upon, and funding for the Alaska Tourism
Marketing Council, the Alaska Seafood Marketing
Institute, Senior Citizen and Disabled Veteran Tax
Relief, Revenue Sharing, Municipal Assistance,
Adult Public Assistance, and Aide to Families with
Dependent Children was adopted. The bill was then
held in committee for concluding action at the
next meeting.
Upon convening the meeting, Co-chairman Frank referenced
open areas of the budget consisting of Dept. of Labor,
Senior Citizen and Disabled Veteran Tax Exemptions,
Municipal Assistance, Revenue Sharing, Alaska Tourism
Marketing, Alaska Seafood Marketing Institute, AFDC, APA,
Front Sections, and amendments. He then suggested that
discussion proceed to review of numbered Amendments
contained within committee packets. [Copies of Amendments 1
through 97 are appended to these minutes.]
AMENDMENT NO. 1
Co-chairman Frank noted that the amendment for the Alaska
State Council on the Arts was technical in nature and
adopted at the April 11, 1995, meeting.
AMENDMENT NO. 2
Senator Sharp explained that the amendment for the Division
of Investments within the Dept. of Commerce and Economic
Development is non-general fund and effects small changes in
"where the funds would be coming from." No objection having
been raised, Amendment No. 2 was ADOPTED.
AMENDMENT NO. 3
Senator Donley said that the amendment contains intent
language asking that by December 30, 1995, the Alaska
Seafood Marketing Institute relocate within Alaska all
employees currently located out of state and that the
decrement in personal services be taken from the Bellevue
Office. The foregoing requests reflect things the
subcommittee intended to do but "didn't quite get into the
intent language." He then MOVED for adoption of the
amendment. In response to a question from Senator Zharoff,
Senator Donley explained that the subcommittee took a $200.0
decrement in personnel services. It was to be taken from
non-Alaskan employees. Senator Zharoff asked if funding for
the Bellevue office derives from the general fund or
industry assessments. He also asked if it was necessary for
the office to be located in Bellevue. Senator Donley said
he posed that question several times and came to the
conclusion that marketing efforts could be conducted from
Alaska. Senator Zharoff advised he had prepared an
amendment to restore the deleted funds and continue the
marketing effort. He explained that most of the funding
represents program receipts from the industry for domestic
marketing.
Comments by Senator Zharoff followed regarding increased
assessments on the industry as well as the increase in board
membership to twenty-five. He said he did not disagree that
employees should be located in Alaska but stressed that the
state has made "some tremendous strides in the marketing
effort of our Alaskan seafood . . . on the domestic level."
A decrement at this time could stall that effort. He
further attested to problems associated with attempts to
conduct all marketing from within Alaska.
Senator Sharp advised that all members of the subcommittee
recommended the proposed language. He noted that half of
ASMI's employees are now located in Bellevue, and half of
the dollars are located there. Senator Donley added that
without the intent, there is danger that the reduction will
be taken against Alaskan rather than out-of-state employees.
Senator Zharoff concurred in need for Alaska hire but again
inquired concerning the impact upon marketing efforts.
ANNALEE McCONNELL, Director, Office of Management and
Budget, came before committee. She advised that the
decrement in program receipt authority is separate from the
amount "that's relative to the Bellevue office." She
declined to become involved in the issue of location of the
out-of-state office.
Co-chairman Frank called for a show of hand on the motion
for adoption. Amendment No. 3 was ADOPTED on a vote of 6 to
1. [See pages 55 and 56 for further discussion of ASMI
funding.]
AMENDMENT NO. 4
Co-chairman Frank advised that the amendment relates to
Senior Citizen and Disabled Veteran Tax Relief and would
fund the Homeowners' Property Tax Exemption at $1,163,800
and the Renters' Equivalency Rebate at $336,200. It would
also fund State Revenue Sharing at $26,836,600 and
Municipal Assistance at $32,646,200. Co-chairman Halford
MOVED for adoption. Co-chairman Frank explained that tax
relief for senior citizens and veterans is funded at a total
of $1.5 million, the same as last year. Funding for
municipal assistance and revenue sharing reflects a 5%
reduction. Senator Phillips MOVED to divide the question
between tax relief and municipal assistance. Co-chairman
Frank noted an error in the proposed amendment in that
amounts shown for deletion under revenue sharing and
municipal assistance should be zero since that Senate
budget, at this point, contains no funding. Amounts shown
for deletion are House figures, a 10% reduction.
Co-chairman Frank called for objections to proposed funding
for senior citizen and veteran tax relief at the FY 95
level. In response to an inquiry from Senator Zharoff,
Annalee McConnell advised that proposed funding of $1.5
million is the same amount requested by the administration.
Upon a show of hands, funding for senior citizen and veteran
tax relief was unanimously ADOPTED.
Senator Phillips expressed a preference for funding
municipal assistance and revenue sharing at the FY 95 level.
Senator Zharoff inquired concerning the amount involved in
the proposed 5% reduction. Annalee McConnell advised that
the administration suggested a 1.7% reduction from FY 95.
Senator Zharoff asked what impact the Senate reduction would
have upon municipalities. Ms. McConnell said that for
communities receiving minimum entitlement, funding would not
change. The reduction would "drop the amount for the larger
communities--anybody over the minimum entitlement." Larger
communities rely more heavily on municipal assistance and
revenue sharing. The largest impact in actual dollars would
be upon Anchorage, Fairbanks, Juneau, etc. The difference
between the reduction anticipated by the administration and
that proposed by the Senate would "a little bit more than
double the amount of reduction that those communities were
expecting to take."
Senator Phillips advised that his opposition to the proposed
amendment, as well as funding suggested by both the
administration and the house, stems from the fact that other
formula fundings have not felt the same reduction as
municipal revenue sharing. Ms. McConnell acknowledged a 55%
reduction "from the high point."
Senator Phillips MOVED to amend the proposed amendment and
provide revenue sharing of $28,249.1 and municipal
assistance of $34,364.4. That would fund both components at
the FY 95 level. Co-chairman Frank voiced his OBJECTION.
Senator Donley concurred in the foregoing comments by
Senator Phillips and noted the chain reaction in municipal
budgets created by the cut, voicing particular concern that
commensurate cuts would be taken in the education budget for
Anchorage. He then voiced support for the amendment to the
amendment. Senator Sharp stressed that the budgeting
approach was to look back to what the state did not have
prior to 1980. Revenue sharing and municipal assistance
were not part of the budget process in 1977-78. He
suggested that if the legislature is going to make
reductions "You've got to look at the big ones." Senator
Zharoff voiced his recollection that prior to state
provision of municipal revenue sharing, moneys flowed to
municipalities from the federal government.
Co-chairman Frank called for a show of hands on the
amendment to the amendment. The motion FAILED on a vote of
3 to 4.
Senator Zharoff MOVED for adoption of an amendment to the
amendment which would provide funding for revenue sharing
and municipal assistance at the 1.7% reduction suggested by
the administration. Co-chairman Frank called for a show of
hands. The motion FAILED on a vote of 2 to 5.
Senator Rieger asked if allocation of funds is prescribed in
statute or administered by regulation when funding is less
than the entitlement. Ms. McConnell explained that the
minimum entitlement for small communities is set in
statutes. The formula method is partially established in
statute with the remainder set in regulations. The
administration does not have discretion as to how it
allocates the money. Further discussion followed concerning
Senator Rieger's recollection that short funding would be
allocated prorata across all communities. REMOND HENDERSON,
Division of Administrative Services, Dept. of Community and
Regional Affairs, spoke to distribution of minimum
entitlement funds and the formula involved in providing
additional funds.
Senator Zharoff expressed concern on behalf of Alaska's
smaller communities. Senator Phillips reiterated need to
examine other state formula programs for reductions. He
stressed need for FY 95 level funding and voiced opposition
to the amendment. Co-chairman Frank called for a show of
hands on the main amendment to fund municipal revenue
sharing at a 5% reduction. The motion CARRIED on a vote of
4 to 3, and the second half of Amendment No. 4 was ADOPTED.
AMENDMENT NO. 5
Co-chairman Halford MOVED for adoption of proposed funding
for Aide to Families with Dependent Children and Adult
Public Assistance. Co-chairman Frank explained that funding
is consistent with SB 98. It reflects a $6.8 million
reduction from the Governor's request. Senator Zharoff
inquired regarding the impact. Ms. McConnell voiced
opposition to reductions in AFDC payments, saying that the
best way to achieve welfare reform is to move individuals
into training and subsequent jobs. She asked if Senate
funding is intended to match proposed House action to cut
the ratable 7%. She further spoke to methods of cutting
welfare, stressing the importance of job training.
KAREN PERDUE, Commissioner, Dept. of Health and Social
Services, came before committee. She voiced her assumption
that proposed funding would precede passage of a statutory
amendment to effect a ratable reduction. The ratable
reduction would be the largest reduction "ever accomplished
on the AFDC program" and would equate to a $69.00 monthly
reduction to each of the 14,000 families on AFDC. Co-
chairman Halford asked how the amendment would compare with
proposed federal reductions in AFDC. Ms. Perdue said that
"If we did no aggressive welfare reform changes," there
would be a reduction in benefits that would be near this
amount. If the state changed eligibility requirements for
the program, the money would be spread differently.
Co-chairman Frank advised that proposed funding for Adult
Public Assistance is at the level requested by the Governor.
In response to a question from Senator Donley regarding the
$125.0 in general funds to be deleted, Co-chairman Frank
explained that the reduction is not associated with
entitlements. It relates to an administrative reduction.
Commissioner Perdue said that the number matches the
subcommittee reduction in the interim assistance program,
offset by a $50.0 increment to assist with legal costs in
helping individuals become "SSI determined."
Co-chairman Frank directed that the meeting be briefly
recessed.
RECESS - 1:05 P.M.
RECONVENE - 1:40 P.M.
Upon reconvening the meeting, Co-chairman Frank directed
attention to a revised version of Amendment No. 5.
End: SFC-95, #31, Side 1
Begin: SFC-95, #31, Side 2
He then noted need to correct amounts set forth on the
revised version to reflect $55,807.2 in federal funds;
$55,807.2 in general funds; and $11,610.7 in other moneys.
Commissioner Perdue explained that proposed funding would
cut AFDC payments by 7%, the maximum federal amount,
resulting in a reduction of $69.00 a month. A statutory
change would be needed to implement the reduction. Payment
will not be cut unless a statutory change is made. Proposed
funding sets the department up for a supplemental should the
Governor veto a statutory change. Ms. McConnell emphasized
that the Governor has gone on record saying he does not
support a reduction in the ratables. Payments are a legal
entitlement. Without a change in the statute, the
administration has no choice but to comply with the statute
and make payments as required. The administration has
active plans for welfare reform, but ratable reduction is
not one of them. Commissioner Perdue advised that the
Senate proposal reflects a policy change as well as a
budgetary change. She suggested that the issue should be
debated in the context of a fiscal note rather than within
the budget. Ms. McConnell referenced the House approach
which effects the statutory change in legislation
accompanied by a fiscal note reducing funding. She urged
that the Senate do the same.
In response to a question from Senator Sharp seeking a
comparison of proposed funding with that for FY 95, NANCY
SLAGLE, Director of Budget Review, Office of Management and
Budget, explained that the amount the administration
requested for FY 96 is less than 95. The Governor's general
fund request is $58,906.0. The amount for FY 95 was
$61,435.0. The Senator then asked if any of the funds
lapsed. Ms. Slagle acknowledged that some were offered as a
reduction in the supplemental.
Commissioner Perdue expressed concern regarding a policy
change and its impact on Alaskan families. She voiced
further concern regarding need for a future supplemental,
advising "This is the kind of payment that we really must
make." People depend on it for their monthly living
expenses.
Discussion followed regarding policy provisions within SB
98.
Co-chairman Frank called for a show of hands on the motion
for adoption. Amendment No. 5 was ADOPTED on a vote of 4 to
2.
AMENDMENT NO. 6
Senator Sharp advised that the amendment to insert $163,800
to support a wood bison management and transplanting program
within the Wildlife Conservation BRU of the Dept. of Fish
and Game budget was ADOPTED at the April 12, 1995, meeting.
AMENDMENT NO. 7
Co-chairman Frank explained that the amendment would conform
Dept. of Administration, Dept. of Law, Dept. of Labor, Dept.
of Natural Resources, Dept. of Fish and Game, Dept. of
Public Safety, Dept. of Transportation and Public
Facilities, Dept. of Community and Regional Affairs and the
University of Alaska budgets to action taken in the Dept. of
Environmental Conservation budget regarding response fund
administration. Senator Rieger voiced his understanding
that the subcommittee for the DEC budget approved the amount
of funding to flow from the oil and hazardous substance fund
to other departments.
Discussion followed between Senator Zharoff and VIRGINIA
STONKUS, fiscal analyst, Legislative Finance Division,
regarding the impact on the University. MARY LOU BURTON,
University of Alaska, concurred in comments that the
University has no problem with the proposed adjustment since
it relates to a board that is sunsetting.
Co-chairman Frank called for objections to adoption of the
amendment. No objection having been raised, Amendment No. 7
was ADOPTED.
AMENDMENT NO. 8
Co-chairman Halford MOVED for adoption. Co-chairman Frank
explained that the amendment would change the reduction in
oil and gas development from a specific reduction in presale
analysis to a general $100.0 general fund reduction within
the $4 million BRU. The intent is to provide greater
flexibility. No objection having been raised, Amendment No.
8 was ADOPTED.
AMENDMENT NO. 9
Co-chairman Frank explained that the technical amendment
establishes the fixed costs component within the fire
suppression BRU in a manner which provides more flexibility
to the department. Ms. McConnell sought assurance that the
intent was clear that costs would be funded through a
supplemental. That was the Senate's preference as opposed
"to doing it up front in the budget." No objection to
adoption having been raised, Amendment No. 9 was ADOPTED.
AMENDMENT NO. 10
Senator Sharp MOVED for adoption. Senator Zharoff OBJECTED
for the purpose of explanation. Senator Sharp advised that,
per the amendment, fish and game funds and federal funds
exceeding the amount funded in the budget must be approved
by the Legislative Budget and Audit Committee. Ms.
McConnell stressed that the department has not needed to go
to LBA "for this kind of thing in the past." No objection
having been raised, Amendment No. 10 was ADOPTED.
AMENDMENT NO. 11
Senator Rieger explained that front section provisions
contained within the amendment relating to the Violent
Crimes Compensation Board and the Council on Domestic
Violence and Sexual Assault comprise the remainder of the
subcommittee report for the Dept. of Public Safety budget.
Language appropriates twenty-five percent of moneys
collected from day fines to compensation of victims of
violent crime and twenty-five percent to the Council on
Domestic Violence and Sexual Assault. Provisions also
extend the lapse date on an FY 95 appropriation to June 30,
1996.
Discussion of operations of day fines followed. When
queried by Senator Zharoff, representatives of the
administration indicated they had no problem with the
amendment. No objection having been raised, Amendment No.
11 was ADOPTED. [See subsequent action on Amendment No. 90
(page 65) for technical correction of amendment language.]
AMENDMENT NO. 12
Senator Rieger explained that operation of the Sitka Airport
remains an unresolved issue in the Dept. of Transportation
and Public Facilities budget. He advised of an earlier
request for a general fund increment for the airport. The
state is now negotiating with the city and borough for an
arrangement whereby the city would collect landing fees,
contract with the state to operate the airport, and transfer
fee receipts to the state for operational costs. Front
Section language proposed within Amendment No. 12 is
intended to accommodate that negotiation. Annalee McConnell
voiced department support for the amendment.
RON LIND, Director, Administrative Services, Dept. of
Transportation and Public Facilities, came before committee
in response to a question from Senator Phillips. He
explained that the city of Sitka indicated it was losing
$150.0 to $200.0 a year on airport operations. Based on
receipts, it would appear the city was spending over $700.0.
Senator Rieger explained that while it was somewhat
arbitrary, the $500.0 proposed by subcommittee was "intended
to give a margin because the earlier referenced general fund
request was "only for $410.0." Mr. Lind advised of a
corrected amount of $490.0. Senator Rieger suggested that
if the proposed appropriation is not sufficient, the
department could come to LBA. Mr. Lind advised that the
state felt it could operate the airport for $490.0, because
it is combined with the highway station at Sitka.
Further discussion followed between Mr. Lind and Senator
Zharoff regarding the city's notification that it would
cancel its operating agreement. Mr. Lind explained that the
state-owned airport was thus returned to the state for
operation. Alaska Airlines agreed to pay Sitka the amount
paid in the past and, in effect, made a grant through Sitka
to the state for operation of the airport. The airport is
the responsibility of the state and operating costs must be
paid. The state is attempting to get the city to take back
operation and reinstitute a fee system. It would then be up
to the city to decide whether to conduct its own maintenance
or contract with the state. Mr. Lind advised, "The state
cannot reinstitute a landing fee there without putting the
tax that was passed last year in jeopardy."
Senator Zharoff asked if a similar process is followed
elsewhere. Co-chairman Frank voiced his understanding that
"It would be a new little wrinkle . . . ." Further
discussion followed concerning the recent tax increase on
aviation fuel and an associated prohibition on landing fee
increases. Mr. Lind explained that when the seven-tenths of
a cent fuel tax increase was enacted last year, it was
designed to cover what the state had attempted to implement
as landing fees at rural airports. It did not consider Sitka
since it was operated by the municipality. The tax increase
was accompanied by language saying the tax would be repealed
if the state institutes a landing fee at a rural airport by
the year 2000. Sitka qualifies as a rural airport under
present definitions.
Further comments followed by Co-chairman Frank regarding the
impact of adoption of the amendment versus failure to do so.
The Co-chairman then called for objections to adoption. No
objection having been raised, Amendment No. 12 was ADOPTED.
AMENDMENT NO. 13
Co-chairman Frank explained that the amendment would replace
subcommittee deletion of the assistant state recorder
position with a general reduction in the Recorder's Office
in the Dept. of Natural Resources budget. Co-chairman
Halford MOVED for adoption of the amendment. In response to
a question from Senator Zharoff regarding the impact of the
change, Co-chairman Frank said it would allow the department
to handle the $63.4 reduction in the least objectionable
way. Senator Zharoff inquired concerning the effect of the
reduction on outlying recording offices. Ms. McConnell said
delays in document processing would occur. However, it
would be easier to spread the reduction overall rather than
target a specific area. The program brings in more receipts
than it expends.
At the request of Co-chairman Frank, Co-chairman Halford
asked that Amendment No. 13 be withdrawn. [See page 13 of
these minutes for subsequent adoption of Amendment 13.]
AMENDMENT NO. 14
Senator Rieger explained that the amendment is comprised of
two parts. The first adds $129.1 in general funds to the
Alaska Police Standards Council. The second adds $150.0 to
a new BRU entitled, "Dalton Highway Protection." The
Senator advised of a new program receipt funding source from
a surcharge on citations to help fund the program. The
original subcommittee recommendation was to zero the general
funds and make the program totally self-supporting from
program receipts. Timing of the program receipts does not
commence until January. The $129.1 represents half-year
funding to cover July through December.
Speaking to the second portion of the amendment, Senator
Rieger noted passage of legislation to open the highway and
a revised fiscal note of $660.0 for protection. The $150.0
in the amendment reflects "all the money that was left under
the cap to put in there." Co-chairman Frank said that when
the highway was opened, he intended to provide funding for
seasonal fish and wildlife protection. While the above
amount does not provide the $660.0 sought by the department,
it provides something. Senator Zharoff concurred in need
for protection along the highway during the time it is most
heavily used.
Senator Donley inquired concerning use of the $129.1 for the
Alaska Police Standards Council. LADDIE SHAW, Executive
Director, Alaska Police Standards Council, Dept. of Public
Safety, advised that it would cover administration of the
Council. Annalee McConnell added that program receipts
cover training for municipal police officers and
correctional officers.
Co-chairman Frank called for objections to adoption of the
amendment. No objection having been raised, Amendment No.
14 was ADOPTED.
AMENDMENT NO. 15
Co-chairman Frank noted that Amendment 15, which makes an
unallocated reduction of $1,385.9 to all components in the
Dept. of Transportation and Public Facilities budget (with
the exception of Marine Highways) and an unallocated $390.6
reduction to the Marine Highway Stabilization Fund, was
previously ADOPTED.
AMENDMENT NO. 16
Co-chairman Halford explained that the amendment transfers
$26.0 from general fund match to general funds within the
General Relief Medical component in the Dept. of Health and
Social Services budget. The net result is zero. Co-
chairman Frank called for objections. No objection having
been raised, Amendment No. 16 was ADOPTED.
AMENDMENT NO. 17
Co-chairman Frank advised that the amendment makes
appropriation of $437,000 for Community Jails contingent
upon contractual extension of rates for the next three
years.
End: SFC-95, #31, Side 2
Begin: SFC-95, #37, Side 1
The Co-chairman advised that FY 96 funding provides the
remaining half of an increment. Yet unfunded is the request
for the FY 95 supplemental. Ms. McConnell cautioned that
proposed funding does not take care of problems with
existing contracts for FY 95. It fully funds contracts
negotiated for FY 96 and carries that amount level for three
years. Contact with communities indicated interest in this
type of approach.
Co-chairman Frank called for objections to the amendment.
No objection having been raised, Amendment No. 17 was
ADOPTED.
[NOTE - See April 20, 1995, minutes for subsequent language
change of "may" to "shall" within the amendment.]
AMENDMENT NO. 18
Co-chairman Frank advised that there is no Amendment No. 18.
AMENDMENT NO. 19
Senator Phillips acknowledged concern by members regarding
OSHA funding. The proposed amendment provides an additional
$30.0 for Occupational Safety and Health in the Dept. of
Labor budget. The budget would remain below the cap even
with the addition. Ms. McConnell advised of $276.0 in the
FY 95 budget for compliance and other problems not covered
by federal statutes. The subcommittee zeroed that amount.
The impact of that action will mean that inspectors in the
field will only deal with "things that could be charged for
federal statutes but would leave uncovered a number of state
statutes . . . ." The $30.0 would provide little ability to
deal with enforcement of state law. She urged consideration
of a higher number. A staff equivalency of 9.5 presently
covers compliance with and violations of state law. Senator
Phillips MOVED for adoption of the amendment. No objection
having been raised, Amendment No. 19 was ADOPTED.
AMENDMENT NO. 20
Co-chairman Frank advised that he would withdraw Amendment
20 relating to community jails.
AMENDMENT NO. 21
Co-chairman Frank said that the amendment would return the
Agriculture Development component to a separate Agricultural
Development BRU. It contains no change in funding. In
response to a question from Senator Donley, the Co-chairman
explained that the House budget moved the component into the
development BRU.
Co-chairman Frank called for objections. Senator Donley
OBJECTED, stressing need for flexibility in spreading
reductions. Placing agricultural development in a separate
BRU restricts that capability. Co-chairman Frank called for
a show of hands. The motion CARRIED on a vote of 5 to 2,
and Amendment No. 21 was ADOPTED.
Senator Zharoff requested a brief recess.
RECESS - 2:35 P.M.
RECONVENE - 2:55 P.M.
AMENDMENT NO. 13
Upon reconvening the meeting, Co-chairman Frank directed
attention to Amendment No. 13 which he advised would replace
deletion of the assistant state recorder in the Recorder's
Office in the Dept. of Natural Resources with a general
reduction. Senator Zharoff advised that his amendment
(Amendment No. 55) was similar. He said that following
discussion of Amendment No. 13, earlier in the meeting, he
received further clarification of the issue and therefore
had no objection to adoption. Co-chairman Halford MOVED for
adoption of Amendment No. 13. No objection having been
raised, the amendment was ADOPTED.
AMENDMENT NO. 22
Co-chairman Frank asked that consideration of Amendment No.
22, relating to additional funding for Fair Business
Practices, Environmental Law, and Operations within the
Dept. of Law be held for later action. [See pages 50, 54-55
for subsequent action.]
AMENDMENT NO. 23
Senator Zharoff explained that the amendment would add
$146.9 to the Public Broadcasting Commission, for support
services, and $280.0 for the Southeast Alaska Microwave. He
then MOVED for adoption. Senator Phillips OBJECTED.
MARK BADGER, Director, Division of Information Services,
Dept. of Administration, and DOUGLAS SAMIMI-MOORE, Executive
Director, Public Broadcasting Commission, Dept. of
Administration, came before committee. Mr. Moore explained
that the Senate appropriation provides for no support staff.
It strictly funds grants. The amendment would provide for
personal services, travel, contractual, and commodities
funding for commission staff. The $280.0 for the Southeast
Alaska Microwave would allow for continued service to Sitka,
Wrangell, Petersburg, Ketchikan, Angoon, Kake, and
Metlakatla. Without the addition, the communities will no
longer receive KTOO transmission.
Senator Phillips stressed that funding recommended by the
subcommittee met the Senate cap. It provides $4.4 million
for public broadcasting. That is 75% more than allowed by
the House. Senator Zharoff noted that since presentation of
subcommittee recommendations, the commission has had an
opportunity to evaluate funding in terms of impact. He said
he was now attempting to bring impact concerns before
committee for correction.
Co-chairman Frank advised that he had not understood that
Senate reductions would result in discontinuation of service
in Southeast. Senator Phillips advised that the
subcommittee budget allows for radio coverage to
communities. He questioned whether television is really a
function of government.
In response to a question from Senator Donley, Mr. Moore
voiced his understanding that the $1.4 million provided in
the Senate budget includes both public television and
RATNET. It will not be possible to fund $280.0 for the
microwave within that amount. Annalee McConnell advised
that if the administration ends up in a situation with House
and Senate numbers as they currently stand, and the
conference committee accepts both numbers and associated
line items, the merger proposal can work. The piece that
would allow the signal to be digitized is in the capital
budget. That would be needed to serve the above-noted
communities. Mr. Moore added that provision of all three
fundings would also reduce operating costs for RATNET and
public television.
Discussion followed between Mr. Moore and Co-chairman Frank
regarding capital budget funding.
Senator Donley noted that the proposed amendment is merely a
piece of what is needed. He advised that he would later
offer an amendment to cover total need.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 23. The motion FAILED on a vote of 1 to 6.
AMENDMENT NO. 24
Senator Zharoff explained that the amendment would add $1.1
million for RATNET. He then MOVED for adoption. Co-
chairman Halford OBJECTED. MARK BADGER, Director, Division
of Information Services, Dept. of Administration, again came
before committee. He explained that the $1.1 million would
allow for transition from the current method of delivering
rural Alaska television to a hybrid of pubic broadcasting
and rural television signals. It would also fund the RATNET
council, which has been unable to meet because of lack of
moneys.
In response to a question from Senator Zharoff, Mr. Badger
acknowledged that RATNET technology is outdated. Senator
Zharoff advised that most communities pay maintenance costs
at the local level. He suggested that the statewide impact
of RATNET on behalf of businesses in Anchorage is
noticeable. In addition to news and other services, it also
provides a vehicle for advertising.
FORMER LT. GOVERNOR RED BOUCHER next came before committee.
He explained that on the first of June, AT&T will take over
Alascom. The new corporation will be watching to determine
how much the state cares about the existing communication
structure to determine what investments it will make in
Alaska. With development of new worldwide telecommunication
technologies, Alaska has an infrastructure that can be used
for medicine, economics, education, etc. Telecommunication
systems could play a significant role in economic
development of rural Alaska. Those involved in public
broadcasting, RATNET, and eduction have decided to
consolidate efforts. Public broadcasting and RATNET have a
program that will work. It should be favorably reviewed in
the name of economic development. As background
information, Former Lt. Governor Boucher submitted a 1990
study resulting from a joint bipartisan effort.
Co-chairman Frank asked that Amendment No. 24 be held
pending review of Senator Donley's amendment. [See pages 42
and 43 of these minutes for action on Amendment No. 24.]
AMENDMENT NO. 25
Senator Zharoff withdrew the amendment, indicating that
community jails had previously been dealt with. [Amendment
No. 17, pages 11-12.]
AMENDMENT NO. 26
Senator Zharoff MOVED for adoption of the amendment to
restore $108.6 to Community Corrections, Northern Region
Probation, within the Dept. of Corrections. He advised that
funding would provide for an additional probation officer to
handle increased caseloads in the Fairbanks Regional Office.
It would also provide clerical assistance and support to the
position. Without the funding, the office will be unable to
provide proper supervision of all offenders.
MARGARET PUGH, Commissioner, Dept. of Corrections, came
before committee. She advised that the Fairbanks Regional
Office includes the Bethel area. Funding would cover a
probation officer and part-time clerk. The officer would be
located in Bethel. The addition would also provide for
emergency locator beacons for snow machine travel.
Discussion of the presentence backlog at Bethel followed
between Senator Donley and Commissioner Pugh. Senator
Donley voiced his understanding that probation offices are
so understaffed that officers are unable to visit homes to
ensure that releasees are complying with the terms of
probation and the public is adequately protected.
Commissioner Pugh acknowledged that as attention focused on
overcrowding in the prison system, an equal amount of
attention was not given to growing caseloads in probation
and parole. Senator Donley attested to a severe lack of
resources and inability of parole officers to do their jobs.
It is important to both victims of crime and the public, in
general, that adequate supervision be in place.
Senator Rieger asked if the department favors a probation
fee. Commissioner Pugh voiced her understanding that a
former probation fee statute was repealed because the cost
of collection exceeded revenues, particularly in Northern
and Southcentral regions.
Senator Sharp concurred in concerns expressed by Senator
Donley regarding public safety. He then advised of his
belief that problems with the division are internal. He
stated that "They've successfully run off five of their most
senior probation officers," one via transfer to Barrow and
another to a desk job at a state jail. Of the remaining
officers who left the division, one had received outstanding
commendations from both the legislature and the U.S.
Congress.
Senator Zharoff warned that problems stemming from lack of
probation resources will not go away. The state will pay
for them in one fashion or another. The alternative to
additional probational officers is more costly.
Co-chairman Frank called for a show of hands on approval of
Amendment No. 26. The motion FAILED on a vote of 2 to 4.
AMENDMENT NO. 27
Senator Zharoff MOVED for adoption of Amendment No. 27.
End: SFC-95, #37, Side 1
Begin: SFC-95, #37, Side 2
Senator Sharp OBJECTED. Senator Zharoff explained that the
amendment would return $1.3 million to road maintenance
within the Dept. of Transportation and Public Facilities by
elimination of the unallocated reduction. Co-chairman Frank
voiced his understanding that the $1.3 million would be
equally split between roads and the marine highway system.
He further advised that the subcommittee budget provides
funding at the FY 94 level, denies increments requested by
the Governor, and contains a $1.3 million unallocated
reduction.
In the course of further discussion of past and proposed
department funding, Senator Rieger presented the following
totals:
FY 94 actual $128,025.0
FY 95 authorized $129,114.0
FY 96 Governor's original request $130,119.0
FY 96 Governor's amended $134,478.9
Senate subcommittee budget $128,025.0
Co-chairman Frank noted that the subcommittee budget is $3
million over the cap. Annalee McConnell stressed that the
new administration requested additional funding due to
concern regarding the deferred maintenance backlog. The
Commissioner is working on reducing the per-lane-mile cost
of maintenance and achieving significant savings. Large
maintenance items total $30 million statewide. Ms.
McConnell cautioned that $30 million is not the full amount.
She further advised that when supplementals are added to the
FY 95 authorized figure, total funding is $132,555.0.
Senator Phillips inquired concerning the administration's
position on a constitutional amendment for a dedicated gas
tax. Ms. McConnell responded that she was unaware of a
position. RON LIND, Director, Division of Administrative
Services, Dept. of Transportation and Public Facilities,
came before committee to speak to the issue. He explained
that the current motor fuel tax collects approximately $25
million. It is not dedicated.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 27. The motion FAILED on a vote of 1 to 6
(Senator Donley did not appear to vote.)
AMENDMENT NO. 28
Senator Zharoff explained that Amendment No. 28 would add
$361.0 for the Alaska Legal Services Corporation in the
Dept. of Community and Regional Affairs. Funding for FY 95
was $361.0. The Governor requested $421.0 for FY 96. The
House provided $261.0, and the Senate subcommittee provided
no funding. The Senator attested to loss of the legal
services office at Kodiak and advised of two or three others
destined to close. Annalee McConnell noted that House
funding would necessitate closure of the Kotzebue office and
reduction of the office at Nome.
REMOND HENDERSON, Director, Division of Administrative
Services, Dept. of Community and Regional Affairs, came
before committee in response to questions from members. He
advised of legal services offices in Anchorage, Bethel,
Barrow, Fairbanks, Juneau, Kotzebue, and Nome. The Kodiak
and Dillingham sites were closed. These nonprofit offices
receive federal, state, and local contributions. Senator
Phillips noted that state funding was not provided until
1981. The Dept. of Community and Regional Affairs
subcommittee used criteria which measured programs in terms
of whether they were constitutionally or statutorily
mandated and in existence before 1977 (before oil). Legal
services did not meet the criteria. In making a choice
between it and Headstart, the subcommittee opted to fund
Headstart.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 28. The motion FAILED on a vote of 1 to 6.
AMENDMENT NO. 29
Senator Zharoff MOVED for adoption of Amendment No. 29. Co-
chairman Halford and Senator Sharp OBJECTED. Senator
Zharoff explained that the FY 95 budget for the waiver
services component within the medical assistance BRU of the
Dept. of Health and Social Services totaled $8,881.5. The
Governor requested $13.6 million. Both the House and Senate
provided $11,248.0. Funding relates to clients who receive
Medicaid for home and community-based services. There are
approximately 295 new requests. Legislative funding allows
for only half. The waiver program prevents individuals from
being institutionalized and saves 50% of Medicaid costs.
Annalee McConnell concurred that the department could fill
all 295 spots. She stressed that the program is a cost
avoidance mechanism for reducing institutional costs.
Senator Rieger asked if the department would favor transfer
of requested funding from Medicaid facilities to Medicaid
waiver services. KAREN PERDUE, Commissioner, Dept. of
Health and Social Services, again came before committee.
She explained that, due to operation of the rate-setting
system, it is not possible to effect a person-by-person
transfer. Facilities continue to have certain fixed costs
even when the population is reduced. Discussion of costs at
Medicaid facilities followed.
Co-chairman Halford voiced support for the waiver program.
He noted that Senate funding is higher than that provided by
the House but not as high as the Governor requested. The
Dept. of Health and Social Services subcommittee budget
"came in about $15 million above the cap." That provides
funding well above last year.
Discussion followed regarding the Harborview facility.
Commissioner Purdue advised of 28 residents who might
benefit from waiver services. Further discussion ensued
relating to the phase-out of Harborview and the fact that
Alaska has one of the largest and fastest growing elderly
populations in the United States.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 29. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 30
Senator Zharoff MOVED for adoption of Amendment No. 30. Co-
chairman Halford OBJECTED. Senator Zharoff explained that
the amendment would provide an additional $2,000.0 in
general funds and a like amount in federal funds to restore
funding for seven services on the Medicaid options list. He
then recited a listing of those services. He referenced the
case of an elderly woman in a remote community within his
district who could afford neither the hearing aid or eye
glasses she needed. Co-chairman Halford acknowledged that
the amendment would restore services previously dropped from
the option list. He said that if the subcommittee could
possibly have restored options and remained within the $15
million over cap, it would have done so. That was not
possible. Without cost containment, this area would be
growing at a rate of over 20% per year. Both House and
Senate budgets maintain exactly the same Medicaid services
as last year. No cut was made.
Commissioner Perdue again came before committee to speak to
the numbers of individuals aided by Medicaid options that
are no longer available.
Senator Donley MOVED to amend Amendment No. 30 and utilize
funding from the underground storage tank program as the
source of the $2 million addition to Medicaid non-facility.
Discussion of the source of the program receipts within the
storage tank fund followed. Co-chairman Frank called for a
show of hands on the amendment to Amendment No. 30. The
motion FAILED on a vote of 1 to 6.
Senator Donley MOVED to amend Amendment No. 30 and utilize
the agricultural loan program as the source of funding. Co-
chairman Frank called for a show of hands on the amendment
to Amendment No. 30. The motion FAILED on a vote of 1 to 6.
Co-chairman Frank called for a show of hands on the main
motion for adoption of Amendment No. 30. The motion FAILED
on a vote of 2 to 5.
Co-chairman Frank directed that the meeting be briefly
recessed.
RECESS - 4:05 P.M.
RECONVENE - 4:20 P.M.
Upon reconvening the meeting, Co-chairman Frank announced
that Amendments 31, 32, 33, 34, and 35, relating to the
Dept. of Fish and Game, would be HELD for later discussion.
Senator Zharoff so MOVED. [See pages 50-53 of these
minutes for action on the amendments.]
AMENDMENT NO. 72
Senator Sharp explained that Amendment No. 72 would restore
recommended funding of $225.0 from fish and game funds to
the species management component in the wildlife
conservation BRU of the Dept. of Fish and Game budget. Co-
chairman Frank called for objections. No objection having
been raised, Amendment No. 72 was ADOPTED.
AMENDMENT NO. 36
Senator Zharoff explained that the amendment would add
$600.0 in general fund program receipts to the solid and
hazardous waste management component in the Dept. of
Environmental Conservation budget. Restoration would allow
for development of a solid waste permitting program to avoid
implementation of federal regulations. Inclusion would
increase Senate funding over the amount provided by the
House. Annalee McConnell concurred that the House effected
a $200.0 cut.
GENE BURDEN, Commissioner, Dept. of Environmental
Conservation, came before committee. He explained that the
$600.0 in program receipts would be generated by fees from
municipal disposal sites and costs associated with closeout
of "drilling mud pits" on the North Slope, Kenai Peninsula,
and other locations. Co-chairman Frank explained that the
subcommittee asked that the department reassess programs for
both solid waste and air quality in an effort to reduce both
programs. Intent language provides the department an
opportunity to come to LBA to receive and expend "these
funds." He advised that the legislature wants the state to
maintain primacy. Subcommittee funding is intended to do
that with the least amount possible so that fees will be the
least onerous. He acknowledged that fees will be higher if
the federal government takes over.
Discussion followed regarding the source of fees. Co-
chairman Frank acknowledged need to see and review a list of
communities and fees paid for approval of dump sites.
[The following portion of the meeting was not recorded.
Minutes reflect transcription of shorthand notes.]
Commissioner Burden expressed concern that lack of
sufficient funding may cause delay in getting the air
quality program started. He expressed further concern
regarding problems in obtaining program receipt approval
through the Legislative Budget and Audit Committee.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 36. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 37
Senator Zharoff MOVED for adoption of Amendment No. 37. Co-
chairmen Frank and Halford OBJECTED. Co-chairman Frank
spoke in opposition to the $1.1 million addition in general
fund program receipts to the air quality management
component in the Dept. of Environmental Conservation budget,
reiterating remarks made in connection with Amendment No.
36. He then called for a show of hands on the motion. The
motion FAILED on a vote of 2 to 5.
End: SFC-95, #37, Side 2
Begin: SFC-95, #39, Side 1
[The following minutes reflect transcription of the tape-
recorded meeting.]
AMENDMENT NO. 74
Senator Donley MOVED for adoption of Amendment No. 74.
Senator Sharp OBJECTED. Senator Donley voiced his belief
that funding the air quality management component in the
Dept. of Environmental Conservation budget at $5,871.4
represents a higher priority than funding for the storage
tank assistance fund. Co-chairman Frank called for a show
of hands. The motion FAILED on a vote of 1 to 5. (Senator
Zharoff did not appear to vote.) [See also, p. 43.]
AMENDMENT NO. 38
Senator Zharoff MOVED for adoption of Amendment No. 38.
Senator Sharp OBJECTED. Senator Zharoff explained that the
amendment would restore $200.0 in general fund program
receipts removed from the personal services line in the
Seattle Alaska Seafood Marketing Institute office of the
Dept. of Commerce and Economic Development budget. He
voiced support for both Alaska hire and location of staff in
Alaska. He further voiced his understanding that in-state
location had been tried, and need for out-of-state staff
gravitated positions to Seattle. A move at this time could
have a negative impact on marketing. Co-chairman Frank
called for a show of hands. The motion FAILED on a vote of
1 to 6.
AMENDMENT NO. 39
Senator Zharoff MOVED for adoption of Amendment No. 39. Co-
chairman Halford OBJECTED. Senator Zharoff explained that
the amendment would restore the $200.0 general fund match
for the Alaska Seafood Marketing Institute. The institute
may be able to receive an additional $1 million in federal
funds through use of match moneys. Senator Sharp
acknowledged the potential match but explained that
institute staff advised of past overestimates. Subcommittee
funding merely lowered the match to what staff indicated
federal funds might be. Intent language specifies that if
additional federal moneys are forthcoming, the institute may
go before Legislative Budget and Audit and "get a pass
through."
GUY BELL, Director, Administrative Services, Dept. of
Commerce and Economic Development, acknowledged the
uncertainty of federal moneys flowing to ASMI. At the
current funding level, the institute has "sufficient minimum
level match for about a $6 million federal grant, which is
about what is anticipated." Mr. Bell further acknowledged
institute concern regarding the signal reduced match funding
sends to the federal government. The federal government
likes to see a larger than minimum match put forth by the
institute. Senator Zharoff cautioned against sending that
message.
Co-chairman Halford asked if language could be included
within the budget to "put in the availability of match that
is clearly contingent on actual receipt of the federal
funds." There would then be no loss but also no potential
use of the funds other than for a federal match. Mr. Bell
voiced his belief that the foregoing could occur in a
restricted, separate, front section appropriation.
Senator Sharp asked if program receipts could provide the
match. Mr. Bell voiced his understanding that past match
moneys have come from the general fund. He advised of two
or three program receipt assessments on processors and
fishermen, collected by the state on behalf of ASMI. The
assessment on fishermen is required to be used for domestic
salmon marketing. It could thus not be used for foreign
marketing--the thrust of the federal receipts. The
assessment on processors is also used exclusively for
domestic marketing. Mr. Bell deferred comment on whether
it could be used for foreign marketing to staff from the
institute.
ART SCHHEUNEMANN, Executive Director, Alaska Seafood
Marketing Institute, Dept. of Commerce and Economic
Development, came before committee. He explained that the
board would decide whether or not to direct funds to
matching purposes.
Senator Zharoff asked if new language and an appropriation
in the front section of the budget would be necessary. Co-
chairman Frank asked that Amendments 39 through 41 be HELD
pending receipt of an answer to the question. [See pages 55-
56 for action on Amendments 39 through 41.]
AMENDMENT NO. 42
Senator Zharoff MOVED for adoption of Amendment No. 42 which
would add intent language requiring relocation of all out-
of-state Alaska Seafood Marketing Institute employees within
Alaska by December 30, 1995. Senator Sharp OBJECTED.
Senator Rieger suggested that as the program becomes
increasingly self-supporting it is not appropriate for the
legislature to "call the shots in this much detail."
Senator Zharoff acknowledged that he did not know what
impact relocation might have upon marketing efforts and
suggested amending the intent to require relocation by June
30, 1996. That would provide opportunity for review during
the 1996 session. Senator Rieger suggested that more
detailed analysis could occur if a request for additional
program receipts is made through the RPL process to the
Legislative Budget and Audit Committee. Senator Zharoff
questioned whether LBA would have authority to delay
relocation should it appear prudent.
Further discussion followed regarding whether the date
should be December or June. Co-chairman Frank called for a
show of hands on Amendment No. 42. The motion FAILED on a
vote of 1 to 6.
AMENDMENT NO. 87
Senator Sharp MOVED for adoption of Amendment No. 87. He
explained that it would restore $1 million to commercial
fisheries, regional and statewide administration, in the
Dept. of Fish and Game budget. Senator Donley OBJECTED,
asking how the addition would fit within the cap. Co-
chairman Frank advised that it would go beyond the cap.
Senator Donley referenced lack of willingness to add funding
to public protection programs such as occupational safety
and probation due to need to remain within caps. He then
questioned the priority, fairness, and lack of consistency
associated with the proposed addition. Co-chairman Halford
noted a reduction of over $5 million in the Dept. of Fish
and Game budget. Restoration of $1 million to commercial
fisheries does not achieve last year's spending level. The
commercial fishery is a generator of revenue in terms of
employment, payroll, and economic activity. Senator Sharp
added that, with the increase, commercial fisheries funding
remains $789.5 below that of FY 95.
FRANK RUE, Commissioner, Dept. of Fish and Game came before
committee and cited areas within commercial fisheries that
would be cut under the Senate budget. Further discussion
followed between Co-chairman Frank and GERON BRUCE,
Legislative Liaison, Dept. of Fish and Game, regarding raw
fish tax receipts. Additional discussion ensued concerning
whether the cost of commercial fisheries management is
offset by jobs, revenues, and economic activity. Annalee
McConnell stressed that Alaska fisheries are priorities in
administrative attempts to diversify the state economy and
promote greater economic development and jobs.
Senator Donley stressed that lack of funding for enforcement
of work place safety presents a "real endangerment to
private enterprise in this state." The only justification
for not providing adequate funding has been an artificial
cap. He again questioned funding priorities. Co-chairman
Halford reiterated that the $27 million commercial fishery
budget generates approximately $100 million in revenue. As
an employer, it ranks with tourism and oil and gas in terms
of the number of jobs and the payroll that flows to the
private sector.
Senator Phillips concurred in Senator Donley's argument
regarding priorities and asked if the $1 million could be
taken from another area of the budget.
Senator Zharoff stressed need for adequate funding in
commercial fisheries, advising that it impacts commercial
fishermen, sport fishermen, personal-use fishermen, and
subsistence. It also impacts the resource. He attested to
need for an adequate assessment mechanism for managing
openings and closings, apportioning the resource among user
groups, and generating statistics for international
negotiations. Senator Phillips advised that resource
protection is one of the highest priorities of his
constituents. He nonetheless expressed reluctance to exceed
the established cap and advised that he would vote against
the proposed amendment unless the $1 million addition could
be taken from elsewhere in the budget. Senator Sharp
stressed that the division of commercial fisheries
represents the only division that has been successful in
managing for abundance.
Co-chairman Frank asked that the amendment be temporarily
withdrawn, saying that the committee would return to it at a
later time. Senator Sharp MOVED to temporarily withdraw
Amendment No. 87. Co-chairman Frank directed that the
meeting be briefly recessed. [See below for subsequent
action.]
RECESS - 5:10 P.M.
RECONVENE - 5:45 P.M.
AMENDMENT NO. 87
Upon reconvening the meeting, Co-chairman Frank directed
that Amendment No. 87 again be brought on for consideration.
He then called for objections to addition of $1 million for
commercial fisheries. Senator Phillips OBJECTED. Co-
chairman Frank called for a show of hands. Amendment No. 87
was ADOPTED on a vote of 6 to 1.
AMENDMENT NO. 43
Senator Zharoff MOVED for adoption of Amendment No. 43. Co-
chairman Halford and Senator Sharp OBJECTED. Senator
Zharoff explained that addition of $400.0 to economic
development in the Dept. of Commerce and Economic
Development budget would restore funding to the Governor's
amended level. Funding pertains to Alaska Regional
Development Organizations (ARDORS). The subcommittee
decrease represents 45% of the funding and will have severe
negative impacts on economic development. The ARDOR program
provides a statewide forum for networking that strengthens
less developed regions and bridges rural and urban
interests. Annalee McConnell advised of the administrative
focus on economic development and suggested that investment
would be evidenced in increased jobs in impacted
communities. Co-chairman Frank called for a show of hands.
The motion FAILED on a vote of 1 to 6.
AMENDMENT NO. 44
Senator Zharoff MOVED for adoption of Amendment No. 44. Co-
chairman Frank OBJECTED, advising of his recollection that
funding for the Alaska Police Standards Council was
previously dealt with in Amendment No. 14. Senator Rieger
concurred. He explained that funding for FY 95 totaled
$274.0. A prior amendment added $130.0 to the council.
That represents half-year funding at the current level of
operations. It reflects bridge money to "get to the point
where program receipts can start to be collected."
DEL SMITH, Deputy Commissioner, Dept. of Public Safety, came
before committee. He explained that the $259.1 contained
within Amendment 44 would fund two positions in police
standards that currently certify and monitor 900 police
officers. Beginning January 1, 1996, a ticket surcharge
will accrue to the council to be used, statewide, for police
training.
End: SFC-95, #39, Side 1
Begin: SFC-95, #39, Side 2
In response to a question from Senator Zharoff, Senator
Rieger explained that general funding would conclude at the
end of December, 1995. Program receipts begin in January of
1996. They are expected to total approximately $300.0
annually. Intent language allows for use of the full amount
of the Governor's program receipt request. Mr. Smith
acknowledged that $350.0 in program receipts will be
directed toward statewide police training, per passage of HB
319 last year. Senator Zharoff asked if the $259.1
contained within the amendment is necessary. Mr. Smith
advised of FY 95 funding of $274.0. Amendment No. 14 funds
the function for one-half year. Mr. Smith said he did not
know whether the department has authority to utilize the
program receipts to continue operations.
Co-chairman Frank called for a show of hand on adoption of
Amendment No. 44. The motion FAILED on a vote of 1 to 5
(Senator Donley did not appear to vote).
AMENDMENT NO. 45
Senator Zharoff MOVED for adoption of Amendment No. 45. Co-
chairman Frank OBJECTED. Senator Zharoff explained that the
amendment would restore the personal services decrement to
Alaska State Troopers, Detachments, in the Dept. of Public
Safety budget. The subcommittee budget relies on federal
interagency receipts (helmet money) that may not
materialize. FY 95 funding for public safety was $30.5
million. The Governor requested $32.2 million. The House
provided $31.3, and the Senate figure is $30.8. The
proposed addition of $1,845.9 would raise the Senate number
to $32.7. Senator Zharoff asked that the administration
respond to the proposal.
DEL SMITH, Deputy Commissioner, Dept. of Public Safety,
again came before committee. He explained that the
department will apply for federal highway safety planning
funds totaling $1.6 million. The state is competing with
ten other state agencies. The state share of $5.4 million
in helmet moneys represents 60%. Forty percent must flow to
local municipalities. There is approximately $10 million in
requests for $5.4 million in available funding. The
department could seek a $1.6 million grant to cover three
years. That would provide $600.0 per year for a number of
positions. Application for $1.6 million for one year would
be frowned upon by the federal agency. Senator Zharoff
asked what would happen if the grant is not received. Mr.
Smith advised of substantial impact and layoffs within the
division.
Annalee McConnell stressed the risky nature of assuming that
federal moneys will replace general fund dollars when it is
known that federal moneys will not be forthcoming in that
amount. That risk may be appropriate in some instances but
not for public safety. She urged that the committee not
substitute unknown federal dollars for general funds.
In response to a question from Co-chairman Halford, Ms.
McConnell reiterated that it would be reasonable for the
department to receive $1.6 million for a three-year period.
That amount is not likely to be provided for a single year.
These are pilot projects. One-third of the funding each
year is reasonable.
Discussion followed regarding measures that might be taken
to fill the $1.6 million budgetary hole. Mr. Smith
referenced 32 court service officers and four troopers as an
example of dollar reductions that would have to be made.
Co-chairman Halford noted that, working from past conference
committee and supplemental funding, the reduction would be
$700.0 rather than the full $1.6 million.
Senator Rieger spoke to subcommittee reasoning at the time
the budget was developed. He noted, specifically, a $2.74
increase in helmet money between FY 95 and 96. He
acknowledged the risk as well as need to remain within a
restrictive cap. Annalee McConnell advised that for
planning purposes, the department could expect $600.0 from
the planning grant.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 45. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 46
Senator Zharoff MOVED for adoption of Amendment No. 46. Co-
chairman Frank OBJECTED. Senator Zharoff explained that the
amendment would switch the funding source for the
enforcement component of fish and wildlife protection in the
Dept. of Public Safety budget from fish and game funds to
general funds. Annalee McConnell attested to support for
the change. Current subcommittee funding would merely draw
down the fish and game fund but not for the purposes
originally established.
Discussion followed concerning whether funds from the
constitutionally established fish and game fund had
previously been used for enforcement. Co-chairman Halford
voiced his understanding that moneys from the fund flow
through the commercial fisheries component and are utilized
for enforcement through the Dept. of Fish and Game rather
than the Dept. of Public Safety.
FRANK RUE, Commissioner, Dept. of Fish and Game, again came
before committee. He explained that moneys from the fund
are utilized for special projects within the commercial
fisheries component. It is used for crab management since
most fines and forfeitures are from the crab fishery.
Criminal fines go into the general fund. Fines and
forfeitures from the fishery go into the fish and game fund.
Co-chairman Frank voiced his understanding that enforcement
officers within the Dept. of Public Safety actually make the
arrests for fishing violations. He then asked why fish and
game funds could not be used for enforcement by that
department. Commissioner Rue acknowledged that fine and
forfeiture moneys could be so utilized. However, these
moneys are now slated for crab management within the Dept.
of Fish and Game budget.
Senator Rieger advised that the $555.0 shown in the budget
and in the proposed amendment is the amount estimated to be
in the fish and game fund sub-account (fines and
forfeitures) as of June 30, 1996. It is not funding that
will be utilized by the department during FY 96 but the
balance expected to be in the account at the end of the
fiscal year. KEVIN BROOKS, Director, Division of
Administrative Services, Dept. of Fish and Game, came before
committee. He suggested that it would be inappropriate to
utilize the estimated balance in budgeting because in making
the estimate the department merely matched revenues and
expenditures. It is impossible, at this point, to determine
what kind of revenue will flow into the fish and game fund
during FY 96. The projected year-end balance for FY 95 is
$513.0. The FY 96 request was based on an available balance
in the fund. The current problem with the Senate budget is
that appropriations for two departments (Dept. of Fish and
Game and Dept. of Public Safety) are based on the same
balance. Annalee McConnell advised that amounts collected
from fines and forfeitures vary considerably from year to
year and are not easily predicted.
Co-chairman Halford noted that options appear to require the
spread of a $555.0 reduction within the Dept. of Public
Safety, a $555.0 reduction in the Dept. of Fish and Game, or
a change of revenue source to general funds. The latter
would increase the overall number by half a million dollars.
Co-chairman Frank asked that Amendment No. 46 be WITHDRAWN
pending additional work on the issue by Co-chairman Halford
and Senator Rieger. [See page 53 and 4/20/95 minutes for
subsequent action.]
AMENDMENT NO. 47
Senator Donley MOVED for adoption of Amendment No. 47. Co-
chairman Frank OBJECTED. Senator Donley advised of serious
consequences from underfunding of the occupational safety
and health budget, and he stressed that worker safety is a
legitimate priority of state government.
Co-chairman Halford inquired regarding previous-year
funding. JERRY BURNETT, aide to Senator Phillips, explained
that funding represents an 8% reduction from the Governor's
requested level for the entire component. Annalee McConnell
said that general funds for the component in the current
budget total $276.0. To an earlier indication that the
department "offered up $30.0," Ms. McConnell clarified that
the department raised concern that the amount suggested was
below the cap by $36.0. There was no indication that $36.0
would take care of the concern.
Ms. McConnell further advised that Alaska statutes cover
areas where federal statutes do not provide protection. One
relates to hazardous materials (asbestos and paints).
Another relates to industries (agriculture) that are exempt
from federal regulations. When inspections are conducted
for federal purposes, general funds allow for inspection for
compliance with state statutes as well. Lack of general
funds will preclude inspection for statutory compliance in
areas not covered by federal law.
Senator Zharoff inquired concerning the liability to which
the state might be exposed due to failure to adequately
enforce standards. He cited the fishing industry and
cannery work as an example. ED FLANAGAN, Deputy
Commissioner, Dept. of Labor, came before committee. He
advised that he could not speak to strict liability but
noted that the department is subject to complaints, "against
our program administration with the federal government," if
the state does not meet industry needs. The general fund
match enables the department to meet minimum federal
staffing requirements. He reiterated that state statutes
that go beyond federal law must also be enforced. The
program has gone from $276.0 in unrestricted general funds
to zero in the Senate budget. That will be difficult in
light of past federal reductions and the probability of
further federal reductions next year.
Co-chairman Frank asked if a general reduction would be
preferable. Mr. Flanagan advised that the department would
probably take the reduction "where the subcommittee came
out." Co-chairman Halford referenced total FY 95 authorized
funding of $33,516.8 and the FY 96 Senate proposal of
$35,512.0 and asked where the overall increase in spending
would go. NANCY SLAGLE, Director of Budget Review, Office
of Management and Budget, advised of a $182.0 increment from
program receipts. That was specifically for acquiring and
selling OSHA regulations. ARBE WILLIAMS, Director, Division
of Administrative Services, Dept. of Labor, came before
committee. She noted an increment of approximately $1
million in federal authorization in the employment security
division. Two grant lines were also increased a combined
total of approximately $1 million for moneys flowing into
the fish fund and STEP. Annalee McConnell stressed that
increases in federal funds do not allow the department to
deal with compliance issues for activities and industries
that are not covered by federal OSHA standards. Ms.
Williams added that increases occurred in components other
than OSHA. Co-chairman Halford suggested that general funds
could be shuffled out of components receiving increased
federal moneys and used for state inspections. Ms. Williams
acknowledged $13.0 in general funds in the employment
security program. It provides a match for the Alaska work
program. There is also $39.0 for the Governor's committee on
employment of people with disabilities. Mr. Flanagan
remarked that general funds have been "pretty well wrung out
of all our BRUs."
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 47. The motion FAILED on a vote of 2 to 5.
[See page 59 for further discussion.]
AMENDMENT NO. 48
Senator Zharoff MOVED for adoption of Amendment No. 48.
OBJECTION was raised. Senator Zharoff explained that the
amendment would restore general fund program receipts
deleted from the occupational safety and health component in
the Dept. of Labor budget. The restored $182.5 would fund
resale of federal regulations. Annalee McConnell said that
the service would make federal publications available to
Alaskan employers. It does not require use of general
funds. If the service is not provided, employers will
purchase these materials directly from the federal
government and pay an increased cost of 25%. The state is
able to offer the materials at a discount. Annalee
McConnell stressed that the cost of the program would be
covered through sale of the materials. No general funds are
involved.
Discussion of promulgation of federal regulations and need
by employers to update materials followed.
Senator Zharoff asked that the amendment be HELD pending
later consideration. [See pages 56 and 59 for subsequent
discussion and action.]
AMENDMENT NO. 49
Senator Zharoff MOVED for adoption of Amendment No. 49.
Senator Sharp OBJECTED. Senator Zharoff explained that the
$30.0 addition would restore the increment for rural
veterans services included in the Governor's amended budget
for the Dept. of Military and Veterans Affairs. JEFF
MORRISON, Director, Administrative and Support Services,
Dept. of Military and Veterans Affairs, informed members
that the new program was included in the amended budget due
to recognition that a considerable number of veterans in
rural Alaska are not currently served by the VSO grant
program and are unaware of many of their benefits. Past
documentation indicates that the "return directly to the
veterans, in terms of increased federal benefits, is in the
range of 35-50 to 1." Census studies indicate there are
approximately 12,000 veterans located outside of urban
areas.
End: SFC-95, #39, Side 2
Begin: SFC-95, #41, Side 1
Senator Phillips advised that he spoke with veterans who
indicated they did not want the special assistant position
if it would mean taking $25.0 out of the veterans program.
He suggested it might be possible to delete the special
assistant and fund rural outreach. Mr. Morrison said the
special assistant position is high on the list of needs and
desires of the new Commissioner. With deletion of the
division director position several years ago, attention to
the veterans program has been dismal. Senator Phillips
suggested that he had received mixed signals from veterans
and asked that the amendment be HELD pending clarification.
[See page 57 for subsequent action.]
AMENDMENT NO. 50
Co-chairman Frank voiced his understanding that similar
intent relating to disaster relief funding through the
disaster declaration process and submission of a
supplemental request for FY 96 disaster relief costs was
before the subcommittee for incorporation within the budget.
He acknowledged subcommittee intent to fund disaster relief
through the supplemental process. He noted need to review
disaster declaration requirements and voiced his
understanding that language requires consultation with
presiding legislative officers. NANCY SLAGLE, Director of
Budget Review, Office of Management and Budget, told members
that if the cost of the disaster is anticipated to total
over $1 million, the President of the Senate and Speaker of
the House are notified.
Annalee McConnell acknowledged her understanding that the
House and Senate are interested in funding both disasters
and fire suppression through the supplemental process rather
than through up-front funding. She explained that the
administration continues to recommend funding through the
normal budget process because the state has been in a
position where it was unable to pay disaster-related bills.
Payment became caught in that period between when
expenditures needed to be made and supplemental action was
taken by the legislature. That will become more of a
problem as cash becomes tighter and tighter. Ms. McConnell
acknowledged legislative concern over expenditure of moneys
by the administration when it is not authorized to do so.
The state would have no choice but to be in that position if
funding is to be provided via supplemental. Senator Zharoff
noted passage of legislation requiring the state to pay its
bills within 30 days or incur penalty. Co-chairman Frank
noted statutory provisions which allow the Governor to use
"any available funds" to pay emergency bills. He then
directed that the amendment be HELD pending review of
statutory disaster declaration language. [See 4/20/95
minutes for further action on this amendment.]
AMENDMENT NO. 51
Co-chairman Frank voiced his understanding that the
committee had already taken action on decreases in the oil
and gas development component within the Dept. of Natural
Resources. He then noted that Amendment No. 51 would
restore $100.0 in general funds. Senator Zharoff MOVED for
adoption. Co-chairman Frank OBJECTED, saying that the
department could handle the relatively small reduction
within the $4 million budget. Senator Zharoff noted that
the reduction would result in fewer offerings and less
revenues to the state. Annalee McConnell stressed need for
conduct of lease sale analysis as quickly as possible. She
further stressed need for economic development on a more
equitable and expedited basis than in the past. The
administration would prefer to be able to spread the
reduction rather than target it to one area.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 51. The motion FAILED on a vote of 1 to 5
(Senator Donley did not appear to vote.)
AMENDMENT NO. 52
Senator Zharoff MOVED for adoption of Amendment No. 52. Co-
chairman Frank OBJECTED. Senator Zharoff explained that the
amendment would restore two lead accountant positions within
the budget for the Dept. of Natural Resources. It would add
$175.8 in general funds to the administrative services
component in the management and administration BRU and
replace $175.8 in general funds with agriculture revolving
loan funds within the agricultural development component of
the resource development BRU. Without the two positions
which collect and account for the department's $800 million
in revenues, the state stands to lose direct revenues and
incur significant audit exceptions and IRS penalties for
non-compliance.
Annalee McConnell advised of the Governor's commitment to
both resolution of past problems with oil and gas accounting
and move-ment toward expeditious, effective, and accurate
collections. The subcommittee reduction goes beyond what is
appropriate for good collection of revenues.
JEFF HARTMAN, Assistant Director, Administrative Services,
Dept. of Natural Resources, came before committee in
response to a question from Senator Donley. He explained
that the original cut of $255.8 in administrative services
specifies elimination of the three top positions within the
division. He noted that the director position is presently
vacant. One of the positions is in charge of revenue
accounting in Anchorage and accounts for revenues of $800
million a year. The second position is filled by Nico Bus.
Mr. Hartman advised that he, himself, fills the third
position. The commissioner would prefer to fund the three
positions from general funds from the plant material center
and replace general funds for the center with agriculture
revolving loan funds.
In response to a question from Senator Donley, Ms. McConnell
said the Dept. of Natural Resources is the largest revenue
collector overall. Collections stem from oil and gas
revenues, timber sales, land payments, park fees, etc.
Senator Zharoff stressed that the net impact of the
amendment is zero. Co-chairman Frank called for a show of
hands on adoption of Amendment No. 52. The motion FAILED on
a vote of 2 to 5.
Following the vote, Senator Donley asked why the proposed
change in funding sources was not a good idea. Co-chairman
Frank noted that the agriculture revolving loan fund has
been raided over the years. Further withdrawals should not
be made. The component has $1.9 million in total funding,
and one of the positions is presently vacant.
AMENDMENT NO. 53
Senator Zharoff MOVED for adoption of Amendment No. 53. Co-
chairman Frank OBJECTED. Senator Zharoff explained that
transfer of $75.0 in general funds for the plant material
center to the land development - public information center
component within the resource development BRU of the Dept.
of Natural Resources and replacement of the general funds
for agricultural development with agriculture revolving loan
funds would restore the reduction to the department's
customer services entity. The public wants more service,
not less. Without the requested funding, the department may
have to close the center. That would mean a reduction in
program delivery to land contract administration, mining
claims, parks, water, and other programs as well as a loss
of "one-stop" convenience for the public.
Jeff Hartman again came before committee. He noted that the
budget for the center is $220.0. The department
investigated a reduction in the hours the center is open and
found that center operations are at a minimum. Co-chairman
Frank said that the subcommittee reviewed the five-position
component and felt adjustments could be made to operate with
four.
Further discussion followed regarding location of the
center, the impact of closure of the central information
office, and assumption of service center functions within
individual divisions.
Mr. Hartman referenced the agriculture revolving loan fund
and noted that it contains $7.2 million in cash. The fund
makes approximately 20 loans a year, and loans average
$73.0. Even with the transfer envisioned in Amendment No.
53, the fund will be able to make agricultural loans through
the year 2002. Senator Sharp asked if the fund would be
subject to sweep to repay the constitutional budget reserve
fund. MIKE GREANY, Director, Legislative Finance Division,
suggested that the fact that it is a revolving loan fund
removes it from the sweep. He advised that he would check
into the status and return information to committee. Nancy
Slagle voiced her understanding that the administration can
make expenditures from the fund without an additional
appropriation. Loans can be made for agricultural purposes.
The fund does not fall under the criteria of "available for
appropriation." Annalee McConnell clarified that moneys in
the fund have already been appropriated and do not require
further appropriation for moneys to be distributed through
loans. Because there is no requirement for additional
appropriation by the legislature, the funds are not subject
to sweep.
Discussion of appropriations to the agriculture revolving
loan fund followed. Mike Greany noted that confusion
results from a front section provision in the House budget
which appropriates $50.0 from the agriculture revolving loan
fund to the general fund as a special fund source. There is
no annual requirement for a front section item to recharge
the fund. It is a statutory, stand-alone, revolving loan
fund. Annalee McConnell added that payments are made from
the fund and repayments go directly back into the fund.
That is the idea behind the revolving concept. Mr. Greany
attested to past appropriations from the fund for
administrative costs within the department. Further
discussion of the number of agricultural loans and
administrative costs associated with the $20.6 million in
loans followed.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 53. The motion FAILED on a vote of 2 to 4
(Senator Sharp was temporarily absent from the meeting).
AMENDMENT NO. 54
Senator Zharoff MOVED for adoption of Amendment No. 54. Co-
chairman Frank OBJECTED. Senator Zharoff explained that the
amendment would add $175.0 in general funds from the plant
material center to the information resource management
component in the management and administration BRU within
the budget for the Dept. of Natural Resources. Plant
material center moneys deleted from the agricultural
development component in the resource development BRU would
be replaced by $175.0 in agriculture revolving loan funds.
He then asked that the administration speak to need. Co-
chairman Frank advised of the subcommittee approach that
divisions that require services from information resource
management contribute to the component. Senator Zharoff
suggested that the Governor's request "was down seven
positions already." He then inquired regarding a position
count.
Annalee McConnell said that, overall, Senate numbers were
$9.4 million less than the Governor's request. Commissioner
Shively has indicated he would attempt to make the cuts
work. However, he identified a few areas where he felt a
high level of service to the public must be maintained to
foster resource and economic development. That includes
geophysical services. Mr. Hartman further attested to need
for the automated land plat, particularly in relation to
mental health lands.
End: SFC-95, #41, Side 1
Begin: SFC-95, #41, Side 2
In response to a question regarding the number of positions,
Co-chairman Frank voiced his understanding that the
operating budget was not reduced by seven position. The
positions were funded by capital improvement program funds.
Reductions in personnel were made when the capital funds
"ran out." Mr. Hartman concurred.
Co-chairman Frank called for a show of hands on Amendment
No. 54. The motion FAILED on a vote of 2 to 4 (Senator
Rieger was absent from the meeting).
AMENDMENT NO. 55
Co-chairman Frank noted that Amendment No. 55 is similar to
Amendment No. 13 and would thus be WITHDRAWN. Senator
Zharoff concurred.
AMENDMENT NO. 56
Co-chairman Frank advised of similar language within the
subcommittee budget for Dept. of Natural Resources fire
suppression. Amendment language relating to the
availability of funding through the disaster declaration
process and via an FY 96 supplemental has been reworded to
meet department needs. The Co-chairman said he had no
problem with the amended language. Senator Zharoff MOVED
for adoption of Amendment No. 56. Senator Sharp noted that
the legislature has not always funded the full supplemental
request from departments. Co-chairman Frank acknowledged
that, but he noted that the option remains for the coming
year. No objection having been raised, Amendment No. 56 was
ADOPTED.
AMENDMENT NO. 57
Senator Zharoff MOVED for adoption of Amendment No. 57. Co-
chairman Frank OBJECTED, noting that it would increase the
federal student aid component in the Alaska Postsecondary
Education Commission of the Dept. of Education budget. The
subcommittee felt this area should not be increased at this
time due to declining revenues. Senator Zharoff explained
that the amendment would take $39.6 from the WICHE program
and place it in federal student aid. The state educational
incentive grant program receives approximately 1,400
applications per year and awards only 325 grants. It is a
needs-based program for low-income students. The Alaska
Postsecondary Education Commission has provided a letter
stating that money is available due to students cycling out
of WICHE and unexpected withdrawals. If passed, the
amendment would fund an additional 26 students. Co-chairman
Frank referenced last year's decision to continue funding
for ongoing WICHE students but not fund new students. As
existing students drop out of WICHE, the department sought
to use available WICHE funds elsewhere. The subcommittee
took the position that funds not needed to maintain the
state commitment to existing WICHE students should be
returned to the general fund.
JOE McCORMICK, Executive Director, Alaska Postsecondary
Education Commission, came before committee. He attested to
the fact that money from WICHE used instead for federal
student aid would be well spent. The bulk of the
applications for aid come from very low-income families.
Students must demonstrate exceptional financial need to
qualify. The federal match is approximately $163.0.
Senator Zharoff asked if provision of the $39.6 would
generate additional federal dollars. Mr. McCormick
responded negatively.
Discussion of the needs test used in qualifying a student
for federal aid followed.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 57. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 58
Co-chairman Frank referenced a technical amendment
(Amendment No. 86) relating to the Alaska State Council on
the Arts and asked that it be dealt with first.
AMENDMENT NO. 86
Co-chairman Frank directed attention to Amendment No. 86 and
advised of subcommittee intent to effect a general reduction
of $57.9 rather than a reduction of $57.9 in the grant line
for the Alaska State Council on the Arts. Co-chairman
Halford MOVED for adoption of Amendment No. 86. No
objection having been raised, it was ADOPTED.
AMENDMENT NO. 58
Senator Zharoff MOVED for adoption of Amendment No. 58. Co-
chairman Frank OBJECTED. Senator Zharoff explained that the
amendment would bring Alaska State Council on the Arts grant
line funding up to the Governor's amended level and ensure
council ability to match maximum federal funds. He attested
to numerous personal opinion messages from constituents in
support of the council. Co-chairman Frank advised of the
subcommittee intent to capture as many federal funds as
possible. DAVID SKIDMORE, aide to Senator Frank, explained
that the department over-estimated the amount of federal
funds that would be available for FY 96. Staff worked
closely with the executive director of the council to
develop the figure of $589.0 in expected federal moneys. An
equal amount of general funds would guarantee the federal
funding. That is the amount contained in the subcommittee
proposal. KAREN REHFELD, Director, Administrative Services,
Dept. of Education, came before committee. She advised that
$589.0 is the minimum level of general funding needed to
retain the current-year federal grant. However, under the
proposed level of cuts, the council will need to go back to
the federal National Endowment for the Arts and reapply.
There is no guarantee the council will receive the same
level of federal dollars.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 58. The motion FAILED on a vote of 2 to 4
(Senator Rieger was temporarily absent from the meeting).
AMENDMENT NO. 59
Senator Zharoff MOVED for adoption of Amendment No. 59.
OBJECTION was raised. Senator Zharoff explained that the
amendment would restore funding for close-up, future problem
solving, and student leadership programs in the Dept. of
Education budget. It would also restore half of the cuts to
the Alaska State Museum. Since funding for the foregoing
would derive from the underground storage tank fund, the
amendment would not increase overall general funding.
Close-up has been zeroed in both House and Senate budgets.
The other two programs were zeroed by the Senate but funded
by the House. Co-chairman Frank voiced his understanding
that moneys for the programs were grants to non-profit
groups that coordinate the efforts. Funding for air travel
is derived from other sources (district moneys and privately
raised funds). If districts wish to continue the programs,
they may allocate funding for that purpose. The Co-chairman
noted that the academic decathlon has survived although
funding for the event was removed from the state budget. If
there is an interest in keeping the programs, districts and
other groups will allocate funds for continuance. State
funds, however, will not be provided.
Senator Zharoff asked if funds could be moved among the
three programs. KAREN REHFELD again came before committee.
She said that initial allocations were based on a level of
funding from several years ago. Reductions that occurred
over the past few years were evenly spread among the three.
Allocations within the $217.0 are $70.4 for close-up, $39.8
for future problem solving, and $107.0 for the student
leadership program.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 59. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 60
Co-chairman Frank referenced the $711,114,140 appropriation
in the proposed amendment and advised that the committee
would not be including K-12 educational support in HB 100.
Education will be funded in separate legislation. Senator
Zharoff requested a brief recess.
RECESS - 7:45 P.M.
RECONVENE - 8:25 P.M.
When the meeting was reconvened, Senator Zharoff directed
attention to a Revised Amendment No. 60 and MOVED for
adoption. Co-chairman Frank said he would not rule the
amendment out of order, but he advised he wished to avoid
lengthy discussion. He reiterated that education would be
funded in separate legislation. Senator Zharoff explained
that proposed funding via the amendment would maintain the
$61.0 educational unit, take increased enrollment into
account, and cover single and dual-site schools. He then
asked if separate legislation containing educational funding
would include those considerations. Co-chairman Frank
acknowledged that that decision had not yet been made.
KAREN REHFELD again came before committee. She advised that
funding contained in the amendment is the amount requested
in the Governor's budget.
Senator Zharoff asked if educational funding in separate
legislation would derive from the general fund,
constitutional budget reserve, or a combination thereof.
Co-chairman Frank again advised that that had not yet been
decided. Senator Donley voiced support for education and
questioned the process of funding "small bits and pieces of
the budget." Co-chairman Frank noted that budgetary
requests and concerns far out number available funding.
Subcommittee work and committee hearings seek to establish
priorities. Senator Donley remarked that without a spending
plan, it is difficult to determine how funding now under
review will fit with education needs. Co-chairman Frank
acknowledged the concern. He then called for a show of
hands on adoption of Amendment No. 60 (Revised). The motion
FAILED on a vote of 2 to 5.
AMENDMENT NO. 61
Senator Zharoff MOVED for adoption of Amendment No. 61.
Senator Rieger OBJECTED. Senator Zharoff said that the
$169,961,700 in funding for the University of Alaska would
restore the unallocated reduction. Co-chairman Frank noted
that the amendment would bring general funds for the
University up to the Governor's request and above FY 95
funding. Senator Zharoff advised that Senate funding of
$167 million is below that for FY 95. The University has
need for level funding. He then inquired concerning the
impact of the $2 million reduction.
MARY LOU BURTON, University of Alaska, came before
committee. She concurred that the amount set forth in the
amendment reflects the Governor's request--FY 95 authorized
plus $500.0 for the opening of the natural science building.
A $2.5 million reduction will require the University to
decrease services. The University has long-term employment
contracts and commitments to students. It is not an
operation that changes quickly. The University went through
a program assessment effort, but results are to be spread
over a three-year time frame." A shorter time frame means
the University will have to "take from those places that we
can cut easier." She cited instructional labor pools and
library books as examples and reiterated that it will not be
easy to change programs in a short period of time.
Senator Donley commented on University money wasted on legal
fees due to illegal personnel practices and bad collective
bargaining practices by the board of regents.
Further discussion followed regarding the unallocated
reduction. Ms. Burton advised that she could not now say
how the reduction would be spread. Co-chairman Frank
expressed intent that the decision be left to the University
and board of regents. Senator Donley voiced lack of
confidence in policy decisions made by the board.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 61. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 62
Senator Zharoff MOVED for adoption of intent language
relating to an increase of general funds to the school of
fisheries at the University and inclusion of a
communications position within the school. Co-chairman
Frank OBJECTED, saying that he would prefer to deal with the
issue either on the floor of the Senate or at conference
committee. The intent is counter to the committee approach
in funding an unallocated reduction which allows the board
of regents to make budgetary decisions. Senator Zharoff
advised that he would WITHDRAW the amendment.
AMENDMENT NO. 63
Senator Zharoff MOVED for adoption of Amendment No. 63.
Senator Sharp OBJECTED. Senator Zharoff explained that the
$415.0 in general funds for trial courts would provide for
maintenance and operation of the new Anchorage courthouse
(scheduled to open in January, 1996) for six months.
ART SNOWDEN, Administrative Director, Alaska Court System,
came before committee. He explained that the funding would
cover heat, lights, and general maintenance in the new
building from January to June, 1996.
End: SFC-95, #41, Side 2
Begin: SFC-95, #43, Side 1
Discussion followed regarding where cuts in the proposed
court system budget might be made to cover expenses of
opening the new building. Co-chairman Halford advised that
the cap for the court system did not allow for increments.
It, in fact, required decrements to trial courts. He said
if he were to add funds back to the budget, they would be
for trial courts rather than for the new building. Senator
Zharoff questioned the advisability of allowing the new
building to sit vacant for six months because of lack of
funding, suggesting that the legislature deal with the
situation at the present time.
In response to a question from Senator Phillips, Mr. Snowden
explained that the new building is on budget. Senator
Phillips asked if funds for the project could be used for
operation and maintenance if it is under budget at
completion. Mr. Snowden suggested that could be done if the
legislature would allow it. He noted that construction
moneys are capital and could not be used for operation and
maintenance.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 63. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 64
Senator Zharoff MOVED for adoption of Amendment No. 64. Co-
chairman Halford OBJECTED. Senator Zharoff explained that
the amendment would provide $67.7 for a labor relations/ADA
coordinator within the administration component of the Court
System budget. The position is needed because of recent
organization of approximately 250 court employees by IBEW.
The position will also handle rapidly increasing demands for
access to court services by persons with disabilities. ART
SNOWDEN again came before committee, stressing need to
negotiate with the union in good faith. Further, the Court
System is the most prone to complaints regarding the ADA.
The position is funded in the House budget. Senator Zharoff
noted that the Senate budget of $5.4 million is below FY 95
funding, lower than that of the House, and much lower than
the Governor's request of $6.2 million.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 64. The motion FAILED on a vote of 2 to 5.
Further discussion followed regarding Court System inability
to utilize labor relations staff at the Dept. of
Administration because of possible claims of collusion and
unfair labor practices.
AMENDMENT NO. 65
Senator Zharoff MOVED for adoption of Amendment No. 65. He
explained that the $60.4 for the administration component of
the Court System would provide for a computer trainer in
Anchorage. He noted that the Senate figure is lower than
both FY 95 funding and the Governor's request. ART SNOWDEN
told members that the judiciary is becoming computerized.
While one person cannot train everyone in the system, the
position could develop materials to assist in district
training.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 65. The motion FAILED on a vote of 1 to 5
(Senator Donley did not appear to vote).
AMENDMENT NO. 66
Senator Zharoff MOVED for adoption of Amendment No. 66. He
explained that addition of $111.4 in general funds to the
administration component in the Court System budget would
restore the unallocated 2% reduction. ART SNOWDEN advised
that $111.4 was removed to meet the cap. This particular
component is already underfunded 12%. The statewide average
is approximately 5.5%. Trial courts are at 7%. Co-chairman
Frank voiced his understanding that the underfunding relates
to vacancy. Mr. Snowden concurred and noted that "Every job
in the court system, Mr. Chairman, is automatically frozen
at the beginning of every fiscal year for 45 days unless I
personally sign a waiver." Very few waivers are signed.
The court system reviews its budget in January, and if
expenses are higher than they should be, a complete freeze
is put in place. That slows the filing of papers in civil
cases. He explained that the state must move criminal cases
within 120 days. Budget reductions have taken a toll in
civil cases.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 66. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 67
Senator Zharoff MOVED for adoption of Amendment No. 67. Co-
chairman Halford OBJECTED. He suggested that if the
committee seeks to improve the status of trial courts, the
Alaska Judicial Council would be a good place from which to
remove funding. He noted that the council operated for many
years with a budget of $200.0 to $300.0 and much volunteer
help. It does not need the present $500.0 and certainly not
the $667.8 proposed by the amendment. Co-chairman Halford
then MOVED to amend the amendment by reducing the $500.0 to
$300.0 and moving the $200.0 difference to the trial court
budget. Senator Zharoff OBJECTED, asking what impact the
amendment to the amendment would have. Co-chairman Halford
acknowledged that the council conducts a substantial number
of research projects for the judiciary. He then recited a
list of projects. The function of the council is to
evaluate and recommend candidates for judges. That can be
done with substantially less money. Senator Donley
concurred that the funding would be better placed in trial
courts.
Co-chairman Halford next withdrew his motion for adoption of
the amendment to Amendment No. 67 to allow for a vote on the
main motion.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 67. The motion FAILED on a vote of 2 to 5.
Co-chairman Halford then restated his MOTION to reduce
Alaska Judicial Council funding from $500.0 to $300.0 and
place the $200.0 difference in the trial courts budget.
Senator Zharoff OBJECTED, voicing concern regarding impact
on the council. Co-chairman Frank called for a show of
hands on adoption of the amendment. The verbal amendment
was ADOPTED on a vote of 6 to 1. [The foregoing verbal
amendment was subsequently reduced to written form in
Amendment No. 89.]
AMENDMENT NO. 68
Senator Zharoff MOVED for adoption of Amendment No. 68. Co-
chairman Frank OBJECTED. Senator Zharoff explained that the
proposed front section provisions would fund monetary terms
of collective bargaining agreements for the Dept. of Public
Safety; Dept. of Transportation and Public Facilities;
Office of the Governor for the Labor, Trades and Crafts
unit; Dept. of Administration for the Labor, Trades and
Crafts unit; and Office of the Governor for the supervisory
unit.
ANNALEE McCONNELL voiced strong support for the collective
bargaining process. Contracts were negotiated in good faith
by the prior administration. She stressed need for the
state to send the message that when contracts are negotiated
in good faith, the state fulfills the contracts. She urged
support for the amendment.
NANCY SLAGLE noted that the first section of the amendment,
containing $203.6 for public safety employees, funds the
second year of a contract from last year. It was not newly
negotiated. Funding is included in the House budget.
Senator Zharoff inquired concerning the impact of not
funding the contracts. Annalee McConnell stressed need for
a clear statement from the legislature concerning whether or
not contracts will be supported. ALISON ELGEE, Deputy
Commissioner, Dept. of Administration, came before
committee. She explained that failure of the legislature to
fund the contracts, and legislative failure to indicate that
it is taking action not to fund them (such as language
proposed by the House) would force the administration to
honor "these contracts with the funds available to us."
That would result in an additional unallocated reduction.
Co-chairman Halford noted that the first paragraph of the
amendment ($250,000 for the Dept. of Public Safety) is
already in the House bill. Remaining sections are in
conflict with sections in the House bill. Annalee McConnell
acknowledged that the amendment contains the original front
section language proposed by the Governor. Co-chairman
Frank suggested that Amendment No. 68 be HELD pending review
of the front section of the budget. [See 4/20/95 minutes
for subsequent committee action.]
AMENDMENTS 69, 70, and 71
Co-chairman Frank noted that Amendments 69, 70, and 71
relate to the front section and asked that they be HELD for
later consideration. [See 4/20/95 minutes for further
action.]
AMENDMENT NO. 72
Co-chairman Frank noted that Amendment No. 72 was previously
adopted. (See page 19 of these minutes.)
AMENDMENT NO. 73
Senator Donley advised that funding set forth in the
amendment for the Rural Alaska Television Network should
read $819.0 rather than $978.7. The difference between the
two reflects a capital project that should appear in the
capital budget. Amendment No. 73 would fill blanks in the
Senate budget, in terms of RATNET funding, with the House
number. Previous testimony before committee indicated that
if the $819.0 was provided as well as that contained within
the subcommittee budget, the proposal to combine Alaska
Public Broadcasting and RATNET services could be
accomplished. Senator Donley MOVED for adoption of
Amendment No. 73. OBJECTION was raised. Co-chairman Frank
called for a show of hands. The motion FAILED on a vote of
1 to 6.
AMENDMENT NO. 24
Co-chairman Frank directed that committee consideration
revert to Amendment No. 24. Senator Zharoff MOVED for
adoption of an additional $1.1 million for RATNET. Senator
Phillips OBJECTED. Senator Zharoff stressed that RATNET
provides information, news, and emergency messages to remote
areas of the state.
MARK BADGER, Director, Division of Information Services,
Dept. of Administration, again came before committee to
reiterate the importance of "keeping rural Alaskans
connected to the urban cultures and vice versa." RATNET
performs that function. It is evolving. It is not a static
system. It is moving into a new information environment
that many Alaskans have said they want the state to
acknowledge and engage. Not providing a line item for
RATNET represents a step backward. Mr. Badger stressed need
for funding the transponder, saying that RATNET bridges the
cultural and geographic barriers of Alaska's people.
Senator Donley advised that he would support the addition
were a funding source available. Amendment No. 24
identifies no source other than general funds. Senator
Zharoff stressed that many communities benefitting from
RATNET do not benefit from general fund expenditure for
numerous other programs for the rest of the state. Annalee
McConnell advised that the state has an opportunity to
retain a level of service throughout the state "so that we
aren't in a position of having such an enormous difference
between what is available in the urban areas and what's
available in the rest of the state." She urged support for
the amendment which would make service available at greatly
reduced cost.
Senator Donley inquired concerning need for the $1.1
million, advising of his understanding that RATNET needed
the House number combined with that of the Senate. He
specifically referenced prior indication that $819.0 would
be needed. Mr. Badger explained that the transition would
cost money. He subsequently acknowledged that the $819.0
would work. He further noted that even with either of the
above-noted numbers, the Alaska Broadcast Commission and
RATNET have sustained a 22.5% reduction. The status quo
will not be maintained. Even with a line item addition for
RATNET, the system will be changed and continue to evolve in
a healthy way at a big reduction.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 24. The motion FAILED on a vote of 2 to 5.
Senator Donley MOVED for funding of $819.0 for RATNET. Co-
chairman Frank called for a show of hands. The motion
FAILED on a vote of 2 to 5.
AMENDMENT NO. 74
Senator Donley explained that additional funding to the
Dept. of Environmental Conservation would bring the Senate
number for new federal mandates on air quality up to the
House level. Funding would be taken from the storage tank
assistance fund. Co-chairman Frank referenced federal
requirements that additions to the program be fee based. He
then voiced OBJECTION to the amendment since there are
alternatives which address the concern. Co-chairman Frank
called for a show of hands on adoption of Amendment No. 74.
The motion FAILED on a vote of 1 to 5 (Senator Zharoff did
not appear to vote).
AMENDMENT NO. 75
Senator Donley advised that an additional $60.0 in the
Commissioner's Office of the Dept. of Environmental
Conservation would offset problems that may be created by
Senate numbers for dealing with federal mandates. The
proposed addition is intended to provide flexibility in
addressing the problem. Co-chairman Frank called for a show
of hands on adoption of Amendment No. 75. The motion FAILED
on a vote of 2 to 5.
AMENDMENT NO. 76
Senator Donley explained that Amendment No. 76 would take
$100.0 from the public defender's office and add $50.0 to
the office of public advocacy and $50.0 to criminal
prosecution. He referenced a handout (copy appended to
Amendment No. 76, attached to these minutes) and noted that
it evidences increases in prosecution expenditures over the
past ten years. He further spoke to need for increased
funding for the office of public advocacy, advising of trial
delays because the office does not have sufficient resources
to adequately deal with the number of trials.
End: SFC-95, #43, Side 1
Begin: SFC-95, $43, Side 2
Discussion of activities within the public defender agency
followed. Senator Donley stressed need to reprioritize
funding among the public defender, public advocacy, and
prosecution and shift resources to areas where they are more
greatly needed.
Senator Zharoff inquired regarding the impact on the public
defender agency. Annalee McConnell remarked that the agency
is already under funded. She acknowledged that the most
serious under funding is in the office of public advocacy.
Under funding relates to both FY 96 and the sizable
shortfall from FY 95. The House number under funds the
agency by $655.0. The Senate figure adds $200.0, but the
net two-year shortfall remains $450.0.
Senator Phillips voiced support for the amendment. Co-
chairman Halford advised that he could support the
amendment, but he cautioned that as the committee adds to
prosecution and maintains reductions on the civil side of
the Dept. of Law, it should be understood that the
department will not transfer activities from the civil side
to the criminal side. Co-chairman Frank noted that no
reductions were made in prosecution. He then asked if
Senator Donley would consider removing funding from the
public defender and placing it only in public advocacy. Co-
chairman Halford concurred that no reductions were made in
prosecution, but he also acknowledged that prosecution is
under funded in terms of "what they're able to do." Senator
Donley referenced figures indicating that, over a ten year
period, prosecution received a 4% increase in funding versus
a 47% increase for the public defender. Further discussion
of increases in all three agencies followed.
SHARON BARTON, Director, Division of Administrative
Services, Dept. of Administration, came before committee.
She concurred that the office of public advocacy is a
response agency. The remedy to increases is not within the
agency but within the system as a whole. Annalee McConnell
advised that the new administration would be examining the
entire criminal justice system. Referencing public
advocacy, specifically, Ms. McConnell further voiced concern
that if the agency is unable to continue to get attorneys on
a voluntary basis, appointments will be made by the courts.
At that point the state will no longer pay $65 to $70 an
hour for these services but will have to pay the going rate
which is well over $100 an hour.
Sharon Barton cautioned against a straight comparison of the
three agencies. She attested to prosecution costs that are
not funded in the prosecution budget and prosecution costs
funded "straight out of the public defender budget." That
makes the public defender budget look much larger compared
to prosecution.
Discussion followed regarding supplemental and subcommittee
funding of prosecution, the public defender, and public
advocacy. JERRY BURNETT, aide to Senator Phillips, advised
of the following:
Public Defender FY 95 authorized -
$7,792.8
w/supp. and RPLs -
$8,200.0
Senate -
$8,154.7
Public Advocacy FY 95 authorized -
$6,614.5
w/supp. and RPLs -
$7,279.0
Senate -
$7,139.6
Ms. McConnell stressed that public advocacy numbers also
relate to abused children with great needs. She described
Alaska's rate of child abuse as "absolutely outrageous."
Attempts to reduce funding to last year's number do not
account for the fact that Alaska has a growing problem that
must be dealt with. She further attested to lack of
flexibility in transferring funds from one area of the
budget to another with greater need. Co-chairman Frank
suggested that necessary flexibility is provided via
supplemental funding. Ms. McConnell advised that she wished
to be on record as saying that the administration has done a
great deal in working with the legislature on cuts. The
"company line has not been that we're only asking for more
money." The administration started out with a budget that
represented the ceiling rather than the floor. it has not
defended "every dollar of those budgets." The focus has
been on areas of most importance.
Further discussion followed regarding the subcommittee
process and restrictions applied by caps.
Senator Rieger voiced support for moving the entire $100.0
from the public defender agency into public advocacy, and
said he would MOVE for that as an amendment to Amendment No.
76. Co-chairman Halford concurred, noting the sizable
shortfall in public advocacy and the fact that prosecution
is funded within $15.0 of last year. Co-chairman Frank
agreed. Senator Zharoff expressed concern over removal of
funding from the public defender agency since that agency is
most noticeable in rural areas.
Co-chairman Frank called for a show of hands on adoption of
the amendment to Amendment No. 76. The motion CARRIED on a
vote of 4 to 3 (Senators Zharoff, Phillips, and Donley were
opposed). Co-chairman Frank called for a show of hands on
adoption of Amendment No. 76, as amended. The motion
CARRIED on a vote of 5 to 2.
AMENDMENT NO. 77
Senator Donley MOVED for adoption of the amendment
appropriating $500.0 from the underground storage tank
assistance fund to the Dept. of Environmental Conservation
to mitigate the effect of federal mandates regarding air
quality, clean water, and other needs. He explained that
the department requested $1.1 million in program receipt
authority. Co-chairman Frank OBJECTED and called for a show
of hands. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 78
Senator Donley referenced past attempts to deal with the
prison over-population problem by under funding prosecutors
and "beefing up the public defender's budget." He voiced
disagreement with that approach and spoke in support of need
for Amendment No. 78, which would restore $1,696.6 to the
budget for the Dept. of Corrections. He suggested that
plans for an additional correctional facility should have
commenced eight years ago.
Lengthy discussion followed between Senator Donley and Co-
chairman Frank regarding correctional needs and responses to
those needs contained within the Senate budget. Co-chairman
Frank stressed that the budget contains over $600.0 in
additional funding for institutions, beyond that provided in
the supplemental. Further discussion of overcrowding,
vacancy, and out-of-state placement followed.
Senator Donley inquired concerning the backlog of 700
misdemeanants waiting to serve time and a subsequent court
order directing the department to provide more timely access
to jails. MARGARET PUGH, Commissioner, Dept. of
Corrections, came before committee. She acknowledged that
an Anchorage court removed department ability to "schedule
people into the institutions." The court now does that
scheduling. While a backlog is no longer building up, there
is chronic overcrowding at the Sixth Avenue institution.
That overflows to Hiland Mountain and Palmer. The
department is constantly shuffling inmates out to available
CRC beds. The Commissioner referenced recent inmate
population figures and noted a total of 2,593 and a capacity
of 2,665.
Senator Donley questioned how much deterrent is provided by
the fact that misdemeanants must wait one to two years to
serve time. Co-chairman Frank concurred in the concern but
noted that the proposed amendment would not increase
capacity.
End: SFC-95, #43, Side 2
Begin: SFC-95, #45, Side 1
Annalee McConnell acknowledged that while the amendment
would not provide additional beds, it would allow for
adequate staff as the inmate population once again
approaches emergency capacity. Danger levels increase when
capacity is reached. There is usually a drop in population
in the spring. That has not occurred this year.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 78. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 79
Senator Donley noted that the proposal contained in
Amendment No. 79 is similar to that in Amendment No. 19
(page 12). He said he would, therefore, not offer Amendment
No. 79.
AMENDMENT NO. 80
Senator Donley explained that when the mandatory insurance
act was passed, motor vehicle registration fees were raised
to pay for enforcement. Over time, the legislature has not
provided the division of motor vehicles full program receipt
authority. The department counters by threatening to no
longer enforce mandatory auto insurance and financial
responsibility laws. Intent language within Amendment NO.
80 would make clear that the legislature wants those
programs continued, and the division should find a means
within its budget to prioritize the programs. Senator
Rieger voiced support for the language, advising of his
intent to support RPL requests for use of increased program
receipts to assist division of motor vehicle field services.
Co-chairman Frank voiced a preference for rewording intent
to require the division to continue enforcement of the
programs within existing levels of appropriation. He noted
that the intended fees were building into revenue
projections. They are not true program receipts. Co-
chairman Halford further questioned intent that directs
approval by the Legislative Budget and Audit Committee. Co-
chairman Frank asked that Amendment No. 80 be temporarily
WITHDRAWN for rewording and subsequent presentation to
committee.
[See page 57 of these minutes for new language adopted by
committee.]
AMENDMENT NO. 81
Senator Donley explained that Amendment No. 81 is a
duplicate of Amendment No 3 (See page 3 of these minutes).
Amendment No. 81 was thus WITHDRAWN.
AMENDMENT NO. 82
Senator Donley explained that the Dept. of Military and
Veterans Affairs has participated with the troopers and
other law enforcement agencies in a drug eradication
program. He noted he had received concerns from
constituents regarding the relationship between the military
and law enforcement. He stressed need for the department to
make operational guidelines available to the public. Co-
chairman Halford noted that most Dept. of Military and
Veterans Affairs funding is federal. He then questioned
whether intent language could be applied. Annalee McConnell
concurred that no general funds are involved. Members of
the national guard are, on occasion, asked by the federal
government or troopers to assist in "a bust," but the
program is not operated by the Dept. of Military and
Veterans Affairs. Senator Donley said that the moneys are
only expended when the guard is acting in a state rather
than federal capacity. He noted a requirement that the
state Attorney General issue written approval of the
operation before the funds can be utilized. Senator Rieger
acknowledged the U.S. Constitutional prohibition on federal
military enforcement of domestic state law.
Co-chairman Frank called for objections to the proposed
intent language. No objection having been raised, intent
language within Amendment No. 82 was ADOPTED.
AMENDMENT NO. 83
Senator Donley explained that intent language within the
amendment requests that parks and recreation management
within the Dept. of Natural Resources give a preference to
residents over non-residents when adopting user fees. It
asks that the fee schedule charge higher fees to non-
residents at a 4 to 1 ratio. Senator Donley then MOVED to
add "least" following the word "at" so that language reads:
"at least a 4 to 1 ratio." The Senator noted that different
fees for residents and non-residents is a common practice in
many states.
Discussion followed regarding how the department would
determine whether a user of park services is a resident or
non-resident. Senator Donley noted that the department is
already in the process of making a distinction between
residents and non-residents. Intent language merely
suggests an appropriate ratio. Annalee McConnell noted that
some fees are presently $12.00. If the cost were
quadrupled, the state would price itself out of the market
in terms of what is acceptable to visitors. Co-chairman
Frank also expressed concern regarding the proposed ratio.
While the thrust of the intent is proper, it goes too far in
establishing a specific ratio.
Senator Donley MOVED to delete "at a 4 to 1 ratio" from the
intent. Language would then read:
It is the intent of the legislature that the
Department of Natural Resources, Division of Parks
and Recreation, review the user fees associated
with Alaska's state parks and adopt a fee schedule
that charges higher fees to non-residents.
Senator Rieger advised that he would be supportive of a 2 or
2.5 to 1 ratio in order to give strong direction to the
division. Co-chairman Frank remarked on need to maintain a
relationship between state fees and those of the private
sector while garnering a higher fee from out-of-state
visitors. He noted that the department has many fees for
many purposes and questioned whether a strict ratio would be
appropriate in all instances.
Co-chairman Frank called for objections to the intent
language as amended. No objection having been raised,
Amendment No. 83 was ADOPTED, as amended.
AMENDMENT NO. 84
Senator Randy Phillips explained that the amendment would
remove funding for public broadcasting radio and public
broadcasting T.V. from the statewide communications services
BRU in the Dept. of Administration budget and place the
funding within a new BRU entitled: Public Broadcasting
Endowment Trust, designated grant, under AS 37.05.316 (named
recipient grant).
JOHN NEWSTROM, Southeast Media Consortium (a group of
Southeast public radio stations) came before committee. He
explained that he was also representing public broadcasters
in Alaska. He voiced support for Amendment No. 84 and
provided background information on the public broadcast
strategic planning process since 1992. Part of that effort
included privatization and support via private funds.
Discussion followed regarding membership in both of the
foregoing organizations and the means of appointment as well
as the status of the current Alaska Public Broadcasting
Commission appointed by the Governor. Co-chairman Halford
questioned the advisability of changing from a known system,
whereby members are appointed and confirmed, to an unknown
entity without establishment in law. He voiced support for
privatization but expressed reluctance to effect the funding
change until an alternative to the present system is in
place. He cautioned against abolishing something by taking
away its function without legislation. By changing a line
item in the budget, the committee would be "doing away with
something that's been there for years." He suggested that
that is the wrong way to proceed.
For clarification, Mr. Newstrom directed attention to intent
language within Amendment No. 85. Co-chairman Halford
concurred in the intent but continued to question the
timing. Changes should be incorporated within substantive
legislation and debate be had thereon. Co-chairman Frank
agreed, advising that while he was not opposed to the idea,
the Finance Committee is not the proper forum for a final
decision on establishment of the proposed mechanism. Co-
chairman Halford cautioned against providing a substantial
grant to a private entity before the entity is "really
defined in a way that we know it's going to stay." Senator
Sharp voiced concern regarding accountability.
Senator Phillips MOVED for adoption of Amendment No. 84.
Co-chairman Frank called for a show of hands. The motion
FAILED on a vote of 3 to 4.
AMENDMENT NO. 85
Senator Phillips moved to WITHDRAW Amendment No. 85 (intent
regarding the public broadcasting endowment trust), advising
that t might be offered for consideration at a later time.
[See page 57.]
AMENDMENTS 86, 87, 88, and 89
Amendments 86 (p. 35), 87 (pp. 22-24), and 89 (Amend. 67,
pp. 40-41) were earlier ADOPTED. Amendment No. 88 was
WITHDRAWN since it was the same as Amendment No. 46 (pages
26-27).
AMENDMENT NO. 22
Senator Zharoff inquired concerning the status of Amendment
No. 22. Co-chairman Frank advised that it was held pending
further information from Senator Halford. Co-chairman
Halford said he would develop an amendment to put program
receipts back in the environmental compliance component.
Co-chairman Frank asked that consideration of Amendment No.
22 again be HELD. [See pages 54-55 for subsequent action.]
AMENDMENT NO. 31
Senator Zharoff MOVED for adoption of Amendment No. 31 which
he explained would restore funding for the Division of
Subsistence to the FY 95 authorized level. The Senate
budget currently has no funding for the division.
End: SFC-95, #45, Side 1
Begin: SFC-95, #45, Side 2
If funding is not restored, the reduction will solidify
federal management of fish and wildlife resources in Alaska.
Lack of reliable information could restrict commercial and
sport use and lead to conservation problems and litigation.
Senator Sharp explained that the subcommittee deleted
general funds for the division. Expenditure of $1,014,300
in the special project fund (federal funds and program
receipts) was approved. KEVIN BROOKS, Director,
Administrative Services, Dept. of Fish and Game, came before
committee. He explained that all non-general funds for the
BRU are in the special projects component. Without general
funds, there will be no division to operate the project.
So, in effect, the general fund reduction would result in
forfeiture of federal funds as well. The division receives
moneys from federal agencies to perform fish counts, collect
data, and conduct various studies. Subsistence resource
specialists are typically the "journey" level job class.
Anthropologists within the wildlife division work on harvest
surveys in remote areas of Alaska. Co-chairman Frank called
for a show of hands on adoption of Amendment No. 31. The
motion FAILED on a vote of 1 to 5. (Senator Donley did not
appear to vote.)
AMENDMENT NO. 32
Senator Zharoff MOVED for adoption of Amendment No. 32.
Senator Sharp OBJECTED. Senator Zharoff explained that the
amendment would restore $711.2 in general funds to the
habitat division. Proposed cuts in habitat would result in
a 50% reduction in forest practices' staff.
Comments followed regarding impact of the cut in terms of
implementation of the forest practices act, permitting
offices, oil and gas lease sale reviews, lack of capability
to provide crucial fish and wildlife data, and participation
in land use initiatives.
Discussion followed regarding Title 16 permitting
provisions. Senator Sharp advised that permitting is funded
at 100% of the FY 95 level. There is no funding cut.
Annalee McConnell noted that in instances of subsistence,
habitat, and commercial fisheries, it is important to
maintain a level of operation to protect existing resources
and ensure good data for the future. On behalf of the
administration, she expressed strong support for
subsistence, habitat, and commercial fisheries. She pointed
to other states as an example of what has happened in areas
where habitat was not carefully managed.
Senator Sharp noted that the $200.0 reduction was proposed
by the administration for transfer to sport fisheries.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 32. The motion FAILED on a vote of 2 to 5.
AMENDMENT NO. 33
Senator Zharoff noted that Amendment No. 87 (pages 22-24) is
similar. He advised that while 87 does not go far enough,
he would nevertheless withdraw Amendment No. 33 with the
hope that it might be incorporated within the budget at a
later date.
AMENDMENT NO. 34
Senator Zharoff MOVED for adoption of Amendment No. 34.
Senator Sharp OBJECTED. Senator Zharoff explained that the
amendment would add $159.3 to the Commissioner's Office of
the Dept. of Fish and Game to restore the subcommittee
reduction. The reduction would eliminate one deputy
commissioner and the director of external and international
fisheries. That would restrict state participation in:
The Boards of Fish and Game
Migratory Bird Act negotiations
Pacific Salmon Treaty negotiations
North Pacific Fishery Management Council
Without the positions, the department will have a difficult
time defending Alaska's interest in critical national and
international forums. The addition would restore funding to
the Governor's original request. Senator Sharp explained
that while the House budget reduces an actual position, the
Senate took an unallocated reduction in the Commissioner's
Office. Subcommittee funding also combined boards,
administrative services, the Commissioner's Office, and
public communications within a $7,144.0 appropriation to
provide flexibility in making the reduction. KEVIN BROOKS
again came before committee. He noted that a majority of
the funding within the Commissioner's Office is for
positions. He attested to full board expenditure of annual
appropriations and noted a $330.0 reduction in the other BRU
included in the new combination. The total $500.0 reduction
will have consequences since it is of a magnitude that
cannot be entirely absorbed through merger.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 34. The motion FAILED on a vote of 1 to 5
(Senator Donley did not appear to vote.)
AMENDMENT NO. 35
Senator Zharoff directed attention to Amendment No. 35 and
advised that requested funding for Bering Sea Fishermen's
Association operations should be $100.4 rather than $110.4.
He then MOVED for adoption. Senator Sharp OBJECTED.
Senator Zharoff explained that the amendment would delete
$200.0 for the new harvest incentive program in the Dept. of
Fish and Game and would add $200.0 in general funds for
three designated grants through the Dept. of Community and
Regional Affairs:
North Slope Borough Whale Census $ 60.0
Yukon River Fisheries Drainage Assoc. $ 29.6
Bering Sea Fishermen's Assoc. $100.4
Senator Sharp noted that the $200.0 reflects fish and game
fund moneys which cannot be used for the foregoing projects.
Senator Zharoff acknowledged that the funds might be
restricted. He then MOVED to change the source of the
$200.0 to general funds.
Speaking to need for the Whale Census, Senator Zharoff noted
that subsistence whale hunts are allowed in ten Alaska
coastal villages. Census figures are an important factor
used by the International Whaling Commission in establishing
subsistence harvest quotas.
Senator Sharp declared a conflict of interest, advising that
his son had flown aircraft used in census taking over the
last few years.
Senator Zharoff next spoke to the importance of funding for
the Bering Sea Fishermen's Association and the Yukon River
Fisheries Drainage Association and information and
assistance provided by both organizations in herring,
salmon, halibut, and bottom fisheries.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 35. The motion FAILED on a vote of 1 to 4
(Senator Donley did not appear to vote, and Senator Rieger
was temporarily out of the committee room).
AMENDMENT NO. 46
Senator Zharoff MOVED for adoption of Amendment No. 46. He
explained that it would switch the funding source for $555.0
within the enforcement component, fish and wildlife
protection BRU, of the Dept. of Public Safety from fish and
game fund moneys to general funds. Fish and game fund
moneys are already slated for other programs. ANNALEE
McCONNELL noted that Amendment No. 46 is similar to
Amendment No. 88 (withdrawn, page 50). She voiced support
for the change to general funds, saying that fish and game
fund moneys are being used in the commercial fishery (crab)
budget. Co-chairman Frank voiced concern regarding an
overall increase in the budget and said he was reluctant to
support the amendment.
Discussion followed regarding fees and forfeitures accruing
to the fish and game fund and budget proposals for
expenditure of fund balances for FY 95 and 96. KEVIN BROOKS
acknowledged that proposed funding would be "a one-time shot
that would deplete the balance" and leave nothing for FY 97.
Co-chairman Frank directed that the meeting be recessed for
Senate Floor Action.
RECESS - 11:30 P.M.
RECONVENE - 12:20 A.M.
Upon reconvening the meeting, Co-chairman Halford requested
unanimous consent for adoption of Amendment No. 46. No
objection having been raised, Amendment No. 46 was ADOPTED.
AMENDMENT NO. 91
Senator Zharoff presented Amendment No. 91 in jest. It was
then withdrawn.
AMENDMENT NO. 92
Co-chairman Frank explained that the amendment, by Senator
Zharoff, would add $361.0 to the grants line for Alaska
Legal Services Corporation in the Dept. of Community and
Regional Affairs and reduce funding for the Alaska Tourism
Marketing Council within the Dept. of Commerce and Economic
Development by a like amount. Senator Zharoff MOVED for
adoption. Senator Sharp OBJECTED. Senator Zharoff said
that use of Alaska Legal Services would be restricted to
divorce, custody, adoption, child or spouse abuse, and child
support. It would not handle criminal matters, accept fee-
generating cases, or deal with subsistence issues. He noted
that the corporation provides needed legal services in "more
remote areas of the state." Co-chairman Frank called for a
show of hands on adoption of Amendment No. 92. The motion
FAILED on a vote of 1 to 6.
AMENDMENT NO. 93
Co-chairman Halford explained that the amendment would add
the following program receipts in two budget components for
the Dept. of Law:
Environmental Compliance $309.7
Exxon Valdez Litigation 50.0
Funding would remain below last year. Both components will
generate additional program receipts. Co-chairman Frank
called for objections. No objection having been raised,
Amendment No. 93 was ADOPTED.
AMENDMENT NO. 22
Co-chairman Frank noted that additional funding for
environmental law was added in Amendment No. 93 (above).
Senator Zharoff MOVED to exclude the $200.0 in general funds
for environmental law from the proposed amendment. No
objection having been raised, the amendment to the amendment
was ADOPTED. Senator Zharoff then MOVED for adoption of
Amendment No 22, as amended. Co-chairman Halford OBJECTED.
BARBARA RITCHIE, Deputy Attorney General, Dept. of Law, came
before committee. She explained that the amendment would
restore $150.0 for fair business practices. It would bring
funding for the component up to that requested by the
Governor and restore moneys for antitrust activities and
consumer protection. Addition of $650.0 to the operations
component would allow the department to continue efforts in
natural resources, legislation, and regulations. Emphasis
would be on natural resources in terms of fish and game
allocation, disputes, and litigation.
Senator Donley voiced concern regarding rumors that the
department might attempt to transfer additional duties to
prosecutors to free civil staff.
End: SFC-95, #45, Side 2
Begin: SFC-95, #47, Side 1
Mrs. Ritchie advised that such shifting would not occur.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 22. The motion FAILED on a vote of 2 to 5.
DEPT. OF COMMERCE AND ECONOMIC DEVELOPMENT
At this point in the meeting, Co-chairman Frank directed
that the subcommittee recommendation for the Alaska Seafood
Marketing Institute (ASMI) be presented. Senator Sharp
MOVED for total funding of $14,045.8 as a working figure.
No objection having been raised, the figure was ADOPTED.
AMENDMENT NO. 39
Senator Zharoff MOVED for adoption of Amendment No. 39.
Senator Sharp OBJECTED. Senator Zharoff explained that the
amendment would restore the $200.0 general fund match for
Alaska Seafood Marketing. There is potential that ASMI may
receive an additional $1 million in federal funds for which
a match would be required.
Discussion followed regarding institute ability to use
assessment funds as a match. GUY BELL, Director,
Administrative Services, Dept. of Commerce and Economic
Development, advised that the board could allow use of
assessment revenues as match funding. The requested $200.0
would match $1 million in anticipated federal funds. The
institute will not know until the end of May whether or not
it will receive the federal moneys.
Further discussion of subcommittee action and whether or not
the additional $200.0 was needed as a match followed.
Additional discussion ensued regarding collection of
assessments.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 39. The motion FAILED on a vote of 1 to 5
(Senator Donley was temporarily out of the committee room).
AMENDMENT NO. 40
Senator Zharoff MOVED for adoption of Amendment No. 40. Co-
chairman Halford OBJECTED. Senator Zharoff explained that
it would restore $1.2 million in general fund program
receipts to the Alaska Seafood Marketing Institute to
alleviate need for ASMI to go to the Legislative Budget and
Audit Committee to expend assessment funds. GUY BELL
advised that ASMI has projected what will be collected in
assessments over the next year. Much depends upon the price
of fish, etc., and projected numbers are uncertain. The
Senate subcommittee inserted intent requesting that ASMI
come before LBA for additional authority if program receipts
exceed the amount appropriated. ASMI is concerned that
assessment proceeds not be used for purposes other than ASMI
seafood marketing. If that were to occur, there would be
problems maintaining self-imposed assessments and the salmon
marketing tax. Senator Sharp said that was not the
subcommittee intention. The $1.2 million reduction was
based on projections of self-assessment totals. The
subcommittee recognizes that additional assessment moneys
are, by statute, strictly allocated to ASMI for promotional
uses. That would be "basic and automatic approval by LBA."
There is no intention of the money being used elsewhere.
Senator Zharoff voiced concern that requests might encounter
problems before Legislative Budget and Audit. He then asked
if subcommittee intent is clear. Co-chairman Frank advised
that the intent is clear.
Further comments by Mr. Bell followed regarding subcommittee
discussion of the $1.2 million, $860.0 in disputed tax, and
the $200.0 in program receipts associated with Washington
state staff. Additional discussion of the status of the
offshore processing tax followed.
Co-chairman Frank called for a show of hands on adoption of
Amendment No. 40. The motion FAILED on a vote of 1 to 6.
AMENDMENT NO. 41
Senator Zharoff MOVED for adoption of Amendment No. 41.
OBJECTION was raised. Senator Zharoff explained that the
amendment would restore $860,0 in general fund program
receipts for administrative and legal appeal of the off-
shore processor tax on behalf of the Alaska Seafood
Marketing Institute. Co-chairman Frank called for a show of
hands on adoption of Amendment No. 41. The motion FAILED on
a vote of 1 to 6.
AMENDMENT NO. 48
Senator Zharoff MOVED for adoption of Amendment No. 48,
advising that it would restore $182.5 in general fund
program receipts for federal program resale within the
occupational safety and health component of the Dept. of
Labor budget. ANNALEE McCONNELL added that state purchase
of government materials for resale to Alaska employers would
save employers 25% and would not cost the state general fund
dollars. The program would be paid for strictly from
program receipts. NANCY SLAGLE advised that the program has
already received half-year funding from the Legislative
Budget and Audit Committee. ARBE WILLIAMS told members
there is no administrative cost associated with the program.
Program receipts will reimburse the initial cost of
purchasing materials.
Senator Rieger declared a conflict, advising that he had a
client who performed a similar service--sold federal
regulations under concession from the federal government--in
the private sector.
Co-chairman Frank directed that Amendment No. 48 again be
HELD for later consideration. [See page 59 of these minutes
for subsequent action.]
AMENDMENT NO. 49
Senator Phillips advised that he had no information on the
amend-ment aside from the fact that the Adjutant General
feels strongly about the issue. Senator Zharoff suggested
that addition of $30.0 for rural veterans services remains a
policy call for members. Co-chairman Frank called for a
show of hands on adoption of Amendment No. 49. The motion
FAILED on a vote of 1 to 4 (Senator Donley did not appear to
vote, and Senator Rieger was temporarily out of the
committee room).
AMENDMENT NO. 80
Senator Donley noted that he had earlier been asked to
revise language contained within Amendment No. 80. He then
directed attention to Amendment No. 80, Revised, which
reads:
It is the intent of the legislature that the
department shall prioritize and continue the
enforcement of mandatory auto insurance and
financial responsibility laws.
He stressed that the intent is to continue these functions
within the Dept. of Public Safety. Co-chairman Frank called
for objections to adoption. No objection having been
raised, Amendment No. 80, Revised, was ADOPTED.
AMENDMENT NO. 85
Co-chairman Frank noted that the amendment had earlier been
withdrawn. Senator Rieger said he wished to offer a portion
of the intent language relating to the Public Broadcasting
Endowment Trust. Rather than appropriate moneys to the
trust, intent would request that the administration work
with the trust to privatize public broadcasting in Alaska.
Discussion centering on wording within the four paragraphs
of intent followed. Senator Phillips advised that the first
three paragraphs were included within the subcommittee
report and previously adopted for inclusion within the
budget. As a result of further discussion, Senator Rieger
MOVED for adoption of only the first sentence of the last
paragraph:
The administration should work with the Public
Broadcasting Endowment Trust to privatize public
broadcasting in Alaska.
Co-chairman Frank called for objections. No objection
having been raised, the intent was ADOPTED. Senator Zharoff
sought and was given assurance that remaining intent
language could be added on the floor of the Senate or in
conference committee.
AMENDMENT NO. 94
Co-chairman Halford explained that Amendment No. 94 would
reduce the Alaska Tourism Marketing Council by $300.0 in
general funds. That brings the total to the House level.
The House has a further unallocated reduction in program
receipts. Co-chairman Frank noted that the subcommittee
report for ATMC had not yet been adopted. Co-chairman
Halford withdrew the foregoing amendment. [See the
following discussion of the ATMC budget for action on
Amendment No. 94.]
DEPT. OF COMMERCE AND ECONOMIC DEVELOPMENT
Senator Sharp MOVED for adoption of proposed subcommittee
funding of $5,715.3 for the Alaska Tourism Marketing
Council. Co-chairman Halford MOVED to amend the report by
reducing general funds by $300.0 for a new total of
$5,415.0. Senator Donley voiced concern that funding for
the council had not been adequately discussed in that
council funding was previously held open for consideration
by the full committee.
End: SFC-95, #47, Side 1
Begin: SFC-95, #47, Side 2
Co-chairman Frank announced that discussion would now
commence. Co-chairman Halford noted House funding of
$5,492.9. Senator Phillips indicated he had a problem with
the $700.0 increase contained in proposed Senate funding.
Senator Rieger voiced support for Co-chairman Halford's
amendment. He noted many areas within the budget where
fees, program receipts, and private non-state funds are
providing greater portions of the budget. Tourism stands
out as the industry that has not come to the table with a
proposal for generation of self-supporting program receipts.
Senator Phillips MOVED to amend the amendment and reduce
ATMC funding by $1 million. He cited the same rationale
voiced by Senator Rieger as support for a greater reduction.
ANNALEE McCONNELL cautioned that a $1 million reduction
would fund the council at $4.7 million. That would be
$200.0 less than the FY 95 level. Senator Sharp attested to
past overstatement of program receipts by $277.6. The net
FY 96 increase was thus $700.0 rather than $1 million. Mrs.
McConnell advised that the FY 95 authorized level was
$4,992.9. Senator Phillips withdrew his amendment for a $1
million reduction and instead MOVED to fund ATMC at the FY
95 authorized level.
Co-chairman Frank clarified that the subcommittee
recommendation reduced excess program receipts by
approximately $200.0. The number proposed by Co-chairman
Halford in the main motion would be a reduction of $1.3
million from the Governor's request and an increase of
$700.0 from last year's funding less the excess program
receipts. It would thus result in an increase of $400.0
plus.
Co-chairman Frank called for a show of hands on the
amendment to the amendment. (Senator Phillips's motion for
FY 95 authorized funding of $4,992.9.) The motion FAILED on
a vote of 1 to 6.
Co-chairman Frank called for a show of hands on Co-chairman
Halford's motion amending ATMC funding to $5,415.0. The
motion CARRIED on a vote of 4 to 3. [NOTE - ATMC funding at
$5,415.0 effectively adopted Amendment No. 94.]
AMENDMENT NO. 47
Senator Donley MOVED to reconsider the committee decision on
funding for occupational safety and health within the Dept.
of Labor budget. He voiced his understanding that the only
reason funding was cut was to meet the cap. He stressed
that the cap should be a goal rather than an "end all, be
all." Senator Donley noted that additional funding had been
provided for "things that are, frankly, a lot less important
than the safety of workers." Without restoration of the
$276.4, there will be no enforcement of state safety laws or
flexibility in dealing with the House at conference
committee.
Senator Donley next MOVED to add half, $138.2, of the
original request to the budget of occupational safety and
health. Co-chairman Frank called for a show of hands on
adoption of Amendment No. 47, as amended. The motion FAILED
on a vote of 2 to 5.
AMENDMENT NO. 88
Co-chairman Halford formally MOVED to withdraw Amendment No.
88 since it was similar to earlier adopted Amendment No. 46
(pages 26-27).
AMENDMENT NO. 48
Attention reverted to Amendment No. 48. Co-chairman Frank
noted that the amendment would restore $182.5 to the
occupational safety and health component within the Dept. of
Labor budget. Funding would continue purchase of federal
regulations for resale to Alaska employers. Senator Zharoff
stressed that the impact of the restoration would be zero in
that the service generates program receipts to reimburse
purchase expenditures. The effort is also supportive of
state industry. Co-chairman Frank called for a show of
hands on adoption of Amendment No. 48. The motion FAILED on
a vote of 2 to 5.
DEPT. OF LABOR
Co-chairman Frank advised that the subcommittee
recommendation for the Dept. of Labor budget was held open
at a prior meeting. Senator Randy Phillips MOVED for
adoption. Senator Donley OBJECTED. He voiced his belief
that it would be a serious mistake not to provide funding
for enforcement of state safety laws. The House also failed
to provide funding for enforcement of current statutes.
Senator Zharoff concurred in Senator Donley's concern. He
voiced further concern regarding state liability should it
fail to protect Alaskan workers.
Co-chairman Frank called for a show of hands on adoption of
the subcommittee budget for the Dept. of Labor. The motion
CARRIED on a vote of 5 to 2.
FRONT SECTIONS
MIKE GREANY, Director, Legislative Finance Division,
directed attention to a work draft SCS for CSHB 100 (Fin)
(9-GH0022\R, Cramer, 4/19/95), containing provisions for the
front section of the budget, and provided the following
review:
Sec. 1 sets forth amounts from the highway fuel tax account
and the aviation fuel tax account, earmarked for the budget.
This is boilerplate language that appears each year.
Sec. 2 contains boilerplate language relating to use of
federal funds beyond those specifically appropriated in the
budget. This section was amended by adoption of Amendment
No. 10, which limits appropriations from the fish and game
fund to stated amounts.
Sec. 3 contains boilerplate language appearing in the budget
every year. It allows for reduction of state general funds
in instances where more federal moneys are received than
anticipated, as long as the reduction is consistent with
federal statutes.
Sec. 4 sets forth boilerplate language calling for reduction
of appropriations if federal funds fall short of the
estimate.
Sec. 5 contains boilerplate language. Both House and Senate
budgets cap the amount of the shortfall that can derive from
the general fund for Title XX (Social Security Act) at
$6,310,800. In response to a question from Senator Rieger,
Mr. Greany explained that funding relates to a component in
the Dept. of Health and Social Services budget.
Sec. 6 contains boilerplate language relating to the state
insurance catastrophe reserve account and settlement of
claims against bonds guaranteeing the reclamation of state
land.
Sec. 7 contains boilerplate language relating to payment of
interest on revenue anticipation notes.
Sec. 8 contains boilerplate language relating to principal
and interest on outstanding state-guaranteed bonds. Senator
Rieger asked if the term "state-guaranteed bonds" rather
than "general obligation bonds" was traditionally used. Mr.
Greany nodded affirmatively.
Sec. 9 language relates to debt service including revenue
bonds for airports.
Sec. 10 relates to lease debt. Subsection (b) specifies
lease payments for Alaska Housing Finance Corporation, City
of Seward, City of Kenai, the Dept. of Natural Resources,
and the Alaska Court System.
Sec. 11 relates to general obligation debt. Mr. Greany
noted that amounts set forth in Secs. 10 and 11 reflect
identical Governor, House, and Senate numbers.
Sec. 12 contains traditional language providing for payment
of dividends from the permanent fund.
Sec. 13 sets forth new language providing $2,703,700 from
the dividend fund to the Dept. of Corrections, per SB 135.
Sec. 14 contains traditional language relating to inflation
proofing of the permanent fund.
Sec. 15 contains traditional language relating to
appropriation of interest to the permanent fund.
Sec. 16 appropriates amounts required to be deposited under
AS 37.12.010(a)(1) and (2) to the principal of the permanent
fund.
Sec. 17 provides for return of left-over STEP funds to the
unemployment compensation fund to satisfy federal
requirements.
Sec. 18 subsections (a) through (e) are similar to language
in prior years appropriating AHFC moneys to the corporation
for use per current statutes. Subsection (d) contains a $70
million transfer of funds from AHFC to the general fund.
Subsection (e) makes provisions of (a) through (c) subject
to Legislative Budget and Audit Committee review through the
revised program process.
Sec. 19 appropriates $9,000,000 in federal receipts to the
disaster relief fund. The Senate bill funds disaster relief
entirely from federal moneys. Mr. Greany noted that
Amendment No. 50 (not yet acted upon by committee (page 30))
contains intent language relating to supplemental funding
for disaster relief.
Sec. 20 appropriates tank registration fees to the storage
tank assistance fund.
Sec. 21 deals with the mitigation account. It appropriates
a specific sum of $3,591,300 to the storage tank assistance
fund. The balance will flow to the oil and hazardous
substance release prevention response fund.
Sec. 22 deals with the mitigation fund account.
Secs. 23 and 24 appropriate amounts from the surcharge to
the oil and hazardous substance release response account and
the oil and hazardous substance release prevention account.
The $4,015,100 and $9,875,700 respectively set forth are
identical to amounts provided in the House budget but lower
than requested by the Governor. That is because the
surcharge limit was reached, and the state will henceforth
only collect the 3-cent portion.
Sec. 25 contains a $21,860,400 appropriation for the
information services fund in the Dept. of Administration.
Funding covers computer and telecommunication services.
This section will need to be conformed to individual budget
items in agencies. The foregoing number reflects
subcommittee action and amendments to date.
Sec. 26 contains a $20,000,000 appropriation for oil and gas
revenue cases to the Dept. of Law. It differs slightly from
the House budget in that the House effected a 75/25 split
between constitutional budget reserve funding and permanent
fund corporation receipts. Senate funding reflects Dept. of
Law advice on the current level of activity between funding
sources and recipients of services.
Sec. 27 appropriates $80,322,400 for school debt retirement.
That is the amount proposed by the Governor and included by
the House.
Sec. 28 contains language that has appeared in previous
years. It allows for program receipts for the Governor's
safety conference. In collecting fees, the conference
straddles fiscal years. Language is included so that moneys
do not lapse.
Sec. 29 contains boilerplate language appropriating moneys
from the real estate surety fund to pay claims awarded under
AS 08.88.470.
Sec. 30 allows program receipts for the Alaska Public
Utilities Commission to be carried forward into FY 96. The
commission will thus not have to charge as much in FY 96 as
it would have had it not been allowed to carry forward the
lapse.
Sec. 31 extends the lapse of Alaska Seafood Marketing
Institute receipts.
Sec. 32 contains a $28,006,600 appropriation from the
general fund to the marine highway system fund to continue
stable services to the public. It reflects all actions to
date (both the subcommittee report and subsequent
amendments).
Sec. 33 provides funding from the four dam pool transfer
fund to the three receiving funds. Mr. Greany noted an
issue raised by the recent filing of a lawsuit to use moneys
coming from utilities in the four dam pool to effect repairs
to failing power lines and other needs. If that suit were
to prevail, funds earmarked for this particular section
would not be available. He further noted a $20 million
capital budget request as an alternative to four dam pool
use of the revenue flow to effect repairs.
Sec. 34 contains the single $9,097,800 appropriation for the
Alaska clean water loan program. This is the same amount
requested by the Governor and included in the House budget.
Sec. 35 contains annual language needed to make the
appropriation for shared taxes.
Sec. 36 makes the appropriation for the salmon enhancement
tax.
Sec. 37 provides $250,000 to satisfy the monetary terms of
the collective bargaining agreement between the state and
the Public Safety Employees Association. It funds the
second year of an in-effect, in-force agreement. Funding
was also provided in the House budget.
Sec. 38 sets forth language included by the House. It says
that failure to provide a separate appropriation to fund
monetary terms nullifies those agreements.
Sec. 39 addresses the Constitutional Budget Reserve sweep.
It provides that any funds swept into the CBR at the close
of FY 95 would be restored to the funds from which they were
swept.
Sec. 40 speaks to use of available balances in the statutory
budget reserve to fund shortfalls in FY 96 appropriations.
The estimated amount that may be available is approximately
$45 million. The source of those funds will be moneys from
the investment loss trust fund, Executive Life repayment.
This provision was established in FY 90 or 91 when
appropriations were made to the investment loss trust fund.
The appropriations specified that moneys be prorated and
returned back to the funds from which appropriated (the
general fund and the statutory budget reserve).
Sec. 41 requires that remaining funds needed to balance the
budget would derive from the Constitutional Budget Reserve.
The section contains language saying that if a three-fourths
vote is garnered, withdrawal will be under sec. 17(c). If
the three-fourths vote is not achieved, withdrawal will
occur under sec. 17(b).
Sec. 42 sets forth language included in the House version of
the budget. It relates to control of expenditures by the
office of management and budget to minimize need to draw
upon the Constitutional Budget Reserve.
Sec. 43 specifies non-lapsing sections.
Mr. Greany noted that Amendments 11 (pages 8-9), 12 (pages
9-10), and 17 (pages 11-12) contain new sections to be
incorporated within the present work draft of front section
appropriations.
Co-chairman Halford MOVED and requested unanimous consent
for adoption of the "R" draft as the working document for
the front section of SCS CSHB 100 (Fin). Senator Phillips
advised that he had a problem with Sec 41. Senator Donley
formally OBJECTED, saying that he did not want there to be
any question about his opposition to some of the content of
the budget.
Senator Phillips voiced his understanding of Sec. 41 to be
that the state would take moneys from the Constitutional
Budget Reserve account to cover the difference between
expenditures and normal revenues. Mr. Greany concurred.
Senator Donley advised that his primary area of concern is
the $70 million appropriation from the Alaska Housing
Finance Corporation. He said that the Governor negotiated a
reasonable response through a recurring dividend. He voiced
further concern regarding Sec. 38 rejection of collective
bargaining agreements and Sec 41 funding from the
Constitutional Budget Reserve fund. Mr. Greany advised that
the $70 appropriation from AHFC was included in Governor
Knowles amended budget. Annalee McConnell voiced concern
regarding a proposed amendment that would change the amount
of the appropriation to $110 million. The administration is
supportive of the $70 million appropriation but not of an
increase.
Senator Phillips MOVED to remove Sec. 41 from the bill.
Prior to action on Senator Phillips' motion, Co-chairman
Frank called for a show of hands on the main motion for
adoption of SCS CSHB 100 (Fin), version "R," as a working
document. The motion CARRIED on a vote of 5 to 2.
Senator Phillips replaced his MOTION to remove Sec. 41 from
the bill. Co-chairman Frank OBJECTED. Senator Phillips
advised that the Constitutional Budget Reserve has no
constituency aside from the Finance Committee. He said he
had a problem tapping into a fund established by voters with
a 70% majority. Annalee McConnell sought clarification of
Sec. 41 provisions relating to the three-quarter versus
majority vote. Co-chairman Frank acknowledged that the
Legislative Finance Division had prepared calculations
regarding what would be available under secs. 17(b) and
17(c). He voiced a preference for a three-quarters vote.
Mrs. McConnell concurred, advising that the intention behind
establishment of the fund was procurement of a three-
quarters vote. Co-chairman Frank called for a show of hands
on removal of Sec. 41. The motion FAILED on a vote of 2 to
4. (Senators Donley and Phillips voted in support of the
motion.)
End: SFC-95, #47, Side 2
Begin: SFC-95, #49, Side 1
AMENDMENT NO. 90
Senator Rieger directed attention to Amendment No. 90 and
explained that it contains a technical change to Amendment
No. 11. It relates to extension of the lapse or
reappropriation of grants and payments of claims for the
Violent Crimes Compensation Board and the Council on
Domestic Violence and Sexual Assault as well as amounts
accruing to the board and council from day-fine receipts.
No objection having been raised, Amendment No. 90 was
ADOPTED.
CONSTITUTIONAL BUDGET RESERVE
Senator Zharoff asked that figures relating to
Constitutional Budget Reserves funding with and without the
three-quarters vote be made available. Co-chairman Frank
directed that the meeting be briefly recessed.
RECESS - 2:10 A.M.
RECONVENE - 2:25 A.M.
MIKE GREANY, again came before committee to speak to a
handout (copy attached to these minutes) entitled "Estimate
of Funds Available for Appropriation for FY 96." He
explained that the tabulation was designed to show what
would be available under sec. 17(b), if there were $100
million left in the earnings reserve of the permanent fund.
Of the two variables involved in use of the 17(b) provision,
the biggest is the disposition of the earnings reserve of
the permanent fund. As long as the earnings reserve remains
in tact (estimated amount: $1.1 or $1.2 billion), 17(b)
would not come into play. If something similar to SB 84
were to pass, appropriating some portion or all of the
earnings reserve to the corpus, 17(b) would become
effective. The other variable is overall spending. While a
major portion is contained within HB 100, education funding
is within a separate vehicle, and the capital budget is in
another. All those appropriations would also play into the
calculation. Without an appropriation from earnings reserve
to the corpus, the amount available for appropriation would
far exceed the difference between last year's expenditures
and this year's available funds, and 17(b) provisions would
not be activated.
Discussion followed concerning what might happen should the
Constitutional Budget Reserve be tapped via a majority vote
and SB 84 fail to pass the legislature or fall victim to
veto. In response to a further question from Senator
Zharoff, Mr. Greany reiterated that should "something
similar to SB 84" pass the legislature, be signed by the
Governor, and leave a balance of approximately $100 million
in the earnings reserve of the permanent fund, assumed
expenditure levels and Legislative Finance calculations
suggest that approximately $423 million could be accessed
from the Constitutional Budget Reserve by a simple majority
under subsection 17(b). Mr. Greany cautioned that both
assumptions and calculations are speculative.
Co-chairman Frank directed attention to proposed amendments
to the front section of the budget.
AMENDMENT NO. 96
Co-chairman Halford MOVED for adoption of Amendment No. 96.
Senator Zharoff OBJECTED for the purpose of explanation.
Co-chairman Halford advised that the amendment would
appropriate $1.6 of the $1.9 million in the oil and
hazardous substance release prevention mitigation account to
the Dept. of Community and Regional Affairs for grants for
the bulk fuel system repair and upgrade program. He
referenced state liability and noted need to work on upgrade
of facilities. The budget contains $3.5 million for leaking
underground storage tanks. This program is a component of
the same problem. Senator Phillips asked if general funds
are involved. Co-chairman Halford responded negatively,
saying that the proposed appropriation flows from the same
funding source used for the underground storage tank
program. MIKE GREANY again came before committee. He
explained that while the moneys are counted as general
funds, rather than appropriation to the response fund, these
moneys would flow to the bulk fuel program. The net effect
would be zero. Co-chairman Halford observed that while the
program is not funded in the House budget, it has been
funded in the past and is an ongoing program. The
appropriation would not add to the general fund total of the
budget because existing budget language (Sec. 21)
appropriates the moneys elsewhere.
Senator Donley voiced ongoing concern regarding underground
storage tanks, suggesting that local communities should take
care of the problem. While the proposed amendment
represents a logical step, it has a downside as well.
Co-chairman Frank called for further questions or objections
to the amendment. No objection having been raised,
Amendment No. 96 was ADOPTED.
AMENDMENT NO. 97
Co-chairman Frank explained that the amendment would
withdraw $17,000,000 in unrestricted cash from the Alaska
Industrial Development and Export Authority (AIDEA) for
transfer to the general fund. It would also appropriate $8
million from the group health and life benefits fund to the
general fund. NANCY SLAGLE, said that similar language was
introduced last year. It was eventually changed and
subsequently vetoed by the Governor. She acknowledged that
more than $8 million in the group health and life benefits
fund was identified as available for use. The
administration attempted to use that funding to cover costs
of health benefits for employees. Moneys flowing to the
fund accrue from many areas. They are not simply general
funds. The administration has concerns over the proposal to
return it to the general fund for purposes other than
employee benefits. Senator Donley concurred in that
concern. He spoke against an across-the-board "attack" on
health benefits, noting that it would equally impact both
low and high paid employees. Ms. Slagle said she could make
no recommendations on what is and is not available from the
fund.
Speaking to the proposed $17 million transfer from AIDEA,
ANNALEE McCONNELL noted that AIDEA is a source of funds for
"a whole host of economic development projects" many of
which are being put together at this time. The
administration would not support use of AIDEA funds.
Senator Donley remarked that Amendment No. 97 contains
"really big issues" that should not be brought on for
discussion at 3:00 a.m. when the public has little
opportunity for input.
Co-chairman Frank suggested that the question of adoption of
the two proposals within Amendment No. 97 be divided.
Referencing the $17 million appropriation from AIDEA, the
Co-chairman noted that the legislature had withdrawn moneys
from the authority in previous years. Should it later be
determined that the funding is not available, the conference
committee could "back away from this appropriation."
Senator Rieger MOVED to divide the question.
Co-chairman Frank called for a show of hands on the $17
million transfer from AIDEA. The proposal was ADOPTED on a
vote of 5 to 2.
At the request of Co-chairman Frank, Co-chairman Halford
MOVED to withdraw the proposed $8 million appropriation from
the group health and life benefits fund. No objection
having been raised, IT WAS SO ORDERED.
Co-chairman Frank directed that the meeting be briefly
recessed.
RECESS - 2:55 A.M.
RECONVENE - 3:05 A.M.
Upon reconvening the meeting, Co-chairman Frank announced
that the meeting would be recessed at this time and
reconvened at approximately 11:00 a.m.
RECESS
The meeting was recessed at approximately 3:10 a.m.
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