Legislature(2019 - 2020)SENATE FINANCE 532
04/25/2019 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| Fiscal Plan Review: Legislative Finance Division | |
| SB32 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED | ||
| += | SB 32 | TELECONFERENCED | |
| += | SB 35 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
April 25, 2019
9:11 a.m.
9:11:18 AM
CALL TO ORDER
Co-Chair Stedman called the Senate Finance Committee
meeting to order at 9:11 a.m.
MEMBERS PRESENT
Senator Natasha von Imhof, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Click Bishop
Senator Lyman Hoffman
Senator Peter Micciche
Senator Donny Olson
Senator Bill Wielechowski
Senator David Wilson
MEMBERS ABSENT
Senator Mike Shower
ALSO PRESENT
David Teal, Director, Legislative Finance Division; Alexei
Painter, Analyst, Legislative Finance Division; John
Skidmore, Director, Criminal Division, Department of Law;
Michael Duxbury, Deputy Commissioner, Department of Public
Safety; Kelly Howell, Director, Division of Administrative
Services, Department of Public Safety; Sylvan Robb,
Administrative Services Director, Department of
Corrections, Office of Management and Budget; Nancy Meade,
General Counsel, Alaska Court System; Senator Cathy
Giessel; Senator Mia Costello.
SUMMARY
FISCAL PLAN REVIEW: LEGISLATIVE FINANCE DIVISION
SB 32 CRIMES; SENTENCING;MENT. ILLNESS;EVIDENCE
SB 32 was HEARD and HELD in committee for further
consideration.
^FISCAL PLAN REVIEW: LEGISLATIVE FINANCE DIVISION
9:12:41 AM
DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE DIVISION,
discussed the presentation titled, "Fiscal Plan Review"
(copy on file). He remarked that the committee had asked
several questions and requested a number of scenarios. He
noted that Mr. Painter would address some of those
questions. He began reviewing some comments and questions
from the presentation the prior Tuesday. He remarked that
there was a focus of four issues: the presentation format,
the expenditure growth rates, revenue options, and an
Permanent Fund Dividend (PFD) priority. He would address
each of those issues separately.
Mr. Teal addressed slide 2, "Where does Governor Dunleavy's
plan lead?", related to presentation issues. He stated that
the first three slides were generated by the Office of
Management and Budget (OMB), although it may not have been
clear to everyone, and he stressed that the slides were now
labeled as prepared by OMB.
Mr. Teal looked at slide 3, "Scenario 1: The Governor's
Plan." He noted that the governor's plan could be closely
reproduced in the Legislative Finance Division (LFD) model.
He stated that the plan showed deficits as high as $450
million during the following six years, which was under the
assumption that the oil and gas property tax was retained
by the state. He remarked that there was another slide that
showed what happens should that property tax not be
retained by the state, which would add approximately $400
million per year to the deficit under the governor's plan.
He stressed that, without that revenue, the plan was not
sustainable.
Mr. Teal highlighted slide 4, "Status Quo Budgeting." He
stated that he referred to this scenario as the "doomsday
scenario." He stated that there was not an attempt to
duplicate the scenario in the LFD model. He stressed that
they did not understand what made PFD go away in FY 22. He
remarked that there was not an attempt to reproduce the
underlying assumptions. He remarked that the primary reason
for "treating it so lightly" was because the scenario did
not reflect neither the House nor the Senate plan. He felt
that there was no proposal that was similar to the
scenario, so he felt it was not relevant to the discussion,
except in its implication that a budget that does not
incorporate the governor's cuts would not be viable. He
stated that the issue was addressed the previous Tuesday
showing House and Senate scenarios that were sustainable
and affordable.
9:16:40 AM
Mr. Teal addressed slide 5, "The Governor's Plan." He
remarked that there was a request to simplify the graphs.
He shared that LFD could not create something that was
helpful, so the charts were not simplified for the day's
meeting. Rather, the focus was on a model that would
generate the desired the scenarios. He stated that the
concern with simplification was that there were many
various factors.
Mr. Teal looked at slide 15, "Real Unrestricted General
Fund Revenue/Budget History." He announced that,
historically, flat budget was not unrealistic. He remarked
that the slide showed the budget and revenue in real
dollars, which meant that they were adjusted for inflation.
He stressed that there was a 20-year period when the budget
declined in real dollars, which meant that it did not keep
pace with inflation. The inflation rate during that twenty
years averaged approximately 2.5 percent. The growth of
expenditures in that time averaged a little less than 1.5
percent. He explained that, compared to the projections of
constrained future revenue and fairly low inflation, a 1.5
percent growth under a 2.5 percent inflation scenario was
not historically unrealistic. He remarked that there was a
time when state employees did not receive raises over five
years, so many employees left for higher paying jobs.
9:25:48 AM
Co-Chair Stedman stressed that the request to LFD did not
steer the legislature. He wanted to move onto the
scenarios, and encouraged the public to understand that
there was an attempt to make decisions.
Mr. Teal addressed slide 16. He stated that the spreadsheet
showed the revenue projections and various options for
expenditures. He stated that the current budget had an
expenditure of approximately $4.3 billion. He furthered
that adding the capital budget, which was an arbitrary
number in transfers that resulted in total spending showing
a surplus of $750 million. He stressed that it would allow
a PFD payment of $1171 apiece. He stated that it was
assuming that a budget surplus went to the dividends, and
then additional PFDs required for the budget to be balanced
with cuts, new revenue, or reserves.
9:30:19 AM
Mr. Teal discussed slide 17, "Projected Reserve Balances --
End of FY19." He stated that there was roughly $2.3 billion
in the Constitutional Budget Reserve (CBR); $19 billion in
the Permanent Fund Earnings Reserve (ERA); $170 million in
the Statutory Budget Reserve; $340 million in the Higher
Education Investment Fund; and $1 billion in the Power Cost
Equalization (PCE) Fund.
Co-Chair Stedman invited Mr. Painter to the table. He
remarked that the CBR was the main savings account, and
required a three-quarter vote from the legislature for
access. He wondered whether the $2.3 billion was the Spring
Forecast number or a more current expectation of oil prices
through the end of June.
Mr. Teal replied that it was the Spring Forecast number.
Co-Chair Stedman recalled the year prior's $1600 PFD. He
recalled that there was an expected draw of $600 million
from the CBR the year prior. He requested the current
year's expected CBR draw.
Mr. Teal replied that at the end of the previous session
showed that the previous anticipated draw was approximately
$700 million, and the Spring Forecast showed a reduced
number of closer to $300 million. The anticipated draw was
now closer to $100 million.
9:34:18 AM
ALEXEI PAINTER, ANALYST, LEGISLATIVE FINANCE DIVISION,
discussed, "Index of Model Outputs - Senate Finance
4/25/19" (copy on file). HE remarked that the committee had
made a number of requests that could have overlapped and
produced many different iterations. He stated that seven
base scenarios were graphed, and there was a summary for
some of the permutations therein to see the impact of
different tweaks within each scenario. He stressed that he
was willing to meet privately to discuss each scenario in
depth.
9:35:16 AM
Co-Chair Stedman noted that LFD was continually
accommodating presenting different options to the committee
members.
Mr. Painter looked at page 2, "1. Senate Budget with $250m
capital budget, 1.5 percent budget growth, 75/25 dividend
split." He remarked that this scenario represented a higher
Capital Budget. He noted that the graph showed a scenario
depicting 2 percent budget growth. He qualified that the
slide
Senator Wielechowski asked about the difference between 1.5
percent and 2.25 percent budget growth.
Mr. Painter highlighted page 3, "Plan Comparisons -
Scenarios with $250 million capital budget." He addressed
Senator Wielechowski's question and noted that the third
column , and pointed out the CBR balance.
Senator Wielechowski asked about an estimate for a yearly
basis of 1.5 percent and 2.5 percent inflation.
Mr. Painter noted that the amount was compounded and
estimated, so he did not have that information. He guessed
that it would be approximately $50 million a year, but
compounding.
Co-Chair Stedman asked Mr. Painter to give his best
estimate for answers and follow up with greater detail if
requested.
Senator Micciche noted that the estimate was based on an 8-
year span. He remarked that there was a $150 million to
state at far below regular interest. He wondered how long
that would be sustainable.
Mr. Painter continued to address slide 3.
9:40:48 AM
Co-Chair von Imhof considered the four columns and thought
it was shown that with a higher inflation rate and a
dividend floor of 25 percent; inflation ate more from state
services each year while the dividend was held harmless.
She thought the scenario would require more reductions and
would be particularly difficult with healthcare expenses.
Mr. Painter addressed page 4, "2. Senate Budget with OMB
capital budget, 2.25 percent budget growth, 75/25 dividend
split." The slide was based on a request, and isolated the
2.25 percent budget growth.
Mr. Painter looked at page 5, "Plan Comparisons - Scenarios
with 2.25 percent budget growth." He remarked that there
was a scenario that showed using the surplus for dividends,
and the third showed a 50/50 dividend split. The result
from that scenario resulted in the CBR running out by the
end of the period.
Senator Hoffman considered that slides 4, 6, and 8 all
showed two and one quarter for the growth rate. He felt
that Mr. Teal made a strong argument for the 1.5 percent.
he understood Co-Chair von Imhof's concerns about Medicaid
and other growth factors that were out of the legislature's
control. He recommended the rate of 1.5 percent to make
better comparisons.
Mr. Painter stated that the purpose of slide 4 was to show
the higher inflation rate.
Senator Hoffman reiterated that his request for a 1.5
percent rate.
9:45:27 AM
Senator Wielechowski asked to be reminded what the OMB
capital budget looked like on a per year basis.
Mr. Painter replied that the OMB capital budget was roughly
$100 million per year of unrestricted general funds.
Mr. Painter discussed page 6, "3. Senate Budget with OMB
capital budget, 2.25 percent budget growth, $1,600 then
50/50 dividend." He stated that he had the request from
Senator Hoffman. He noted that the slide showed the 2.25
percent growth rate. He noted that once the dividend was
increased, the CBR would run out in the scenario.
Mr. Painter displayed page 7, "Plan Comparisons - Scenarios
with $1,600 then 50/50 dividend." He stated that the slide
showed the numbers with a lower inflation rate. He remarked
that the unplanned draws would be less with that lower
budget growth rate.
Mr. Painter addressed a worksheet of graphs that was
requested by Senator Hoffman and addressed (copy not on
file), which showed the scenario, but with 1.5 percent
inflation scenario.
Senator Hoffman explained that he requested the scenario so
that people could see that the $1600 dividend would give at
least four years to contemplate the gap.
Co-Chair Stedman remarked that Senator Olson has an
additional scenario.
9:50:46 AM
Co-Chair von Imhof stressed that the "$1.6 billion deficit"
was contrived, and felt that the state did not have a
fiscal crisis. She stated that with both the Senate and
House plans, there was approximately $700 million in
surplus. She stressed that the problem was determining the
priority.
Senator Wielechowski noted that the percent of market value
(POMV) draw was 5.25 percent in 2020, and reduced to 5
percent in 2028; although there was an effective percentage
of 4.44 and 4.84 percent. He asked for an explanation.
Mr. Painter replied that the effective percentage was lower
than the stated percentage, because of the five-year
average in the delay. The FY 20 POMV draw was based on a
five-year average of fiscal years ending in FY 18. As a
result the actual percentage of that year's balance was
lower than the stated draw, assuming that the fund
continued to grow.
Co-Chair Stedman announced that it would change depending
on an advancing or declining market.
Senator Micciche stressed that it assumed the Callan growth
assumption of 6.55 growth rate.
Mr. Painter agreed.
Co-Chair Stedman remarked that it was the projected growth
rate by the consultants of the Permanent Fund.
Mr. Painter addressed page 8, "4. Senate Budget with OMB
capital budget, 2.25 percent budget growth, $1,600 then
75/25 dividend." He remarked that the scenario showed that
the CBR would shrink, but still existed through the whole
scenario.
Mr. Painter looked at page 9, "Plan Comparisons - Scenarios
with $1,600 then 75/25 dividend." He remarked that the CBR
was still intact, but was reduced to approximately $400
million. He remarked that, with the $250 million and 2.25
percent growth there would be no CBR by the end of the
period. He also remarked that there may not be some
unplanned draws from the ERA, but with more constrained
budgets there would be more of a CBR at the end of the
period in the scenario.
9:55:26 AM
Mr. Painter highlighted page 10, "5. Senate Budget with OMB
capital budget, 1.5 percent budget growth, 60/40 dividend."
He remarked that there would be significant deficits in the
scenarios, of approximately $400 million to $600 million.
He remarked that the CBR would be eliminated in the
scenario. He did not do multiple permutations, but agreed
to provide that information.
Co-Chair Stedman surmised that it seemed that there were
many $300 million to $400 million deficits. He felt that
there was a convergence of those numbers. He queried
impressions at running all the scenarios.
Mr. Painter replied that if one had a statutory dividend,
the full $3000 would result in higher deficits particularly
with higher budget growth. He stressed that the highest
growth rate was with inflation.
Mr. Painter addressed page 11, "6. Senate Budget with OMB
capital budget, 1.5 percent budget growth, stairstep
dividend (25 percent to 33 percent to 40 percent to 50
percent)." He stated that the scenario showed multiple
steps up of dividends.
Mr. Painter looked at page 12, "7. Senate Budget with $250m
capital budget, 2.25 percent budget growth, 50/50 dividend,
repeal of per-barrel credit." He remarked that it would
show the impact of repealing the per barrel credit.
Co-Chair Stedman queried the number used for the marginal
revenue change.
Mr. Painter replied that the value of the credit during the
period ranged from just over $1 billion to approximately
41.2 billion higher in some of the first years, and then
reducing slightly.
Co-Chair Stedman surmised that removed the per barrel
credit.
Mr. Painter agreed, and stated that it assumed no other
changes in the tax law or company behavior.
10:00:14 AM
Senator Bishop asked for an explanation of the deficits in
FY 22 to FY 26 on the slide.
Mr. Painter replied that repealing the per barrel credit
had a larger revenue impact in the first two years, then
declining, then increasing again. He stated that it
resulted in surpluses and then deficits, which was based on
the 50/50 split.
Co-Chair Stedman noted that regardless of politics,
changing one component impacted other components.
Mr. Painter noted the slide in the packet that was added to
the presentation title, "8. Senate Budget with OMB Capital
Budget, 1.5 percent growth statutory dividend." He stated
that the statutory calculation was roughly $3000 in the
current year, growing, and then shrinking again. He stated
that the scenario showed deficits of approximately $1.2
billion in the first year, and increasing to $1.7 billion,
and then decreasing again toward the end of the forecast
period. He noted that the CBR would run out near the end of
FY 22.
Co-Chair Stedman felt that it was important to see the
impact of a $300 PFD.
Co-Chair Stedman noted that there was a reflection of the
urgency related to changes.
10:05:24 AM
Senator Micciche felt that it was an easy problem to fix.
He stressed that the problem extremely complex that would
result in a painful decision.
Co-Chair von Imhof stressed that the public felt many
different things.
Senator Hoffman stated that the statutory dividend was way
to high to consider further. He stressed that the split
must be resolved in the long-term, otherwise there would be
a political issue in all of the elections.
Senator Wielechowski remarked that there were many laws
that the public felt might be irrational, and that was the
reason for the legislature. He shared that the legislature
decided on a dividend, and felt that the formula should be
followed. He agreed that the issue was so important to the
public, and felt that it should be decided by a vote of the
people.
Senator Bishop remarked that there must be a comprehensive
"road show" to show the potential implications of future
Alaskans.
Co-Chair Stedman felt that there needed to be a "split
bill." He noted that there was a committee bill that would
take the percentage of market value (POMV) draw.
Senator Olson stated that he was the one that asked for the
step down split scenario. He noted that he was still in
favor of a full PFD.
Co-Chair Stedman thanked the committee and the presenters
for their time and consideration of the different models.
10:16:58 AM
AT EASE
10:17:01 AM
RECONVENED
Co-Chair Stedman announced that the meeting would recess
until 1:30pm.
10:17:26 AM
RECESSED
1:32:59 PM
RECONVENED
SENATE BILL NO. 32
"An Act relating to criminal law and procedure;
relating to controlled substances; relating to
probation; relating to sentencing; relating to reports
of involuntary commitment; amending Rule 6, Alaska
Rules of Criminal Procedure; and providing for an
effective date."
1:33:30 PM
Co-Chair von Imhof emphasized that one of the Senate's top
priorities was to address crime. Her intent was for
committee members to fully understand the bill and identify
1:35:12 PM
JOHN SKIDMORE, DIRECTOR, CRIMINAL DIVISION, DEPARTMENT OF
LAW, wanted to know the details that he should provide
within the fiscal note.
Co-Chair von Imhof stated that she would like the
highlights of the fiscal note.
Mr. Skidmore addressed a new fiscal note from the
Department of Law, OMB Component 2202.
Senator Bishop asked if Mr. Skidmore was confident that six
prosecutors would be sufficient.
Mr. Skidmore replied that the fiscal note indicated what
would be initially appropriate.
Senator Bishop stated that to get his support for the bill,
he did not want to use the cheap route.
1:40:03 PM
Co-Chair von Imhof noted that the last sentence on the
second page which showed that additional support staff may
be appropriate.
Mr. Skidmore affirmed that statement.
1:40:31 PM
Co-Chair Stedman thought it would be nice to have more
clarity in referencing the document related to each fiscal
note.
Co-Chair von Imhof agreed.
Mr. Skidmore referenced the document heading for the fiscal
note OMB Component 2202.
Co-Chair Stedman recalled that before the passage of SB 91
(which was passed to lower costs), and wondered where the
state would be as related to the timelines of the crime
bills.
Co-Chair von Imhof thought Co-Chair Stedman was asking if
the department had lost staff and if the fiscal note was
bringing the department back to status quo.
Mr. Skidmore stated that the request would not bring the
department back to the previous levels in 2015. He stated
that it would bring the number close to it.
Senator Hoffman thought the CS addressed recriminalization
of driving with cancelled licenses. He wondered whether any
of the dollars would be administered in rural Alaska.
Mr. Skidmore answered in the affirmative.
Senator Wilson was trying to find the average case load per
prosecutor for misdemeanors.
Mr. Skidmore did not have a definitive number.
1:45:58 PM
Senator Wilson asked if Mr. Skidmore expected the appellate
court to have an increase in cases.
Mr. Skidmore answered in the affirmative.
Senator Wielechowski addressed Co-Chair Stedman's question,
and asked if the department would be able to prosecute all
misdemeanors and felonies.
Mr. Skidmore stated that the department believed that the
numbers reflected in the fiscal note.
1:48:17 PM
Co-Chair von Imhof commented that the it was difficult to
pair with numbers from the past because the state had
federal funds for drug offenses. She referenced the
designation of being a high-intensity drug-trafficking area
(HIDTA). She stressed that it all interplayed with the
number of crimes and criminals.
Mr. Skidmore agreed with Co-Chair von Imhof's comments.
Co-Chair von Imhof summarized that the fiscal note showed
approximately $1.48 million annually for the next four
years, with thirteen positions.
1:50:12 PM
Senator Wielechowski appreciated an early conversation he
had with Mr. Skidmore. He asked about a provision in
Section 41 of the bill. He proposed an amendment to say the
court could suspend the license of someone that was not
making a good faith effort to pay. He wondered if the
amendment could be supported by the administration.
Mr. Skidmore relayed that he had not considered the full.
He was not comfortable taking a position on that without a
full understanding.
Co-Chair von Imhof requested a hard copy of the amendment.
Senator Wielechowski addressed Section 24 of the bill that
pertained to terroristic threats. He thought the section
was reasonable, however there was some incongruity in
Section 24, lines 25 through 29. He stated that it appeared
that if a person, for example, threatened to blow up the
pipeline, that person had broken the law. He stated that
threatening to shoot someone in the head did not break the
law. He wondered whether that was incongruous.
Mr. Skidmore recalled that he had discussed a scenario
related to a phone call that threatened a person, and
stated that it would not satisfy an eminence for an assault
in the third degree.
Mr. Skidmore was not sure he agreed that the language was
inconsistent.
Senator Wielechowski pondered if it should be a crime to
call a person and threaten to shoot the person.
Mr. Skidmore noted that the conduct might be too broad. The
language in the current bill could be changed if needed.
1:55:52 PM
Senator Wielechowski addressed Section 26 of the bill,
which dealt with criminal possession of controlled
substances. He was concerned about making a felony for
simple possession, which would follow an individual far
into the future and affect many areas of life. He was not
sure it was the right policy call. He thought the matter
was worthy of debate.
Co-Chair von Imhof agreed that the matter was a policy
call, and thought the matter came to the heart of the issue
of crime.
Senator Micciche stated he had supported SB 91. He thought
the members had not been aware of its eventual impact. He
had spent time learning about suspended judgement. He
thought it was a matter of simple market economics. He
strongly supported suspended entry of judgement. He thought
without a deterrent, there was a low probability of drug
users making a life change.
2:00:31 PM
MICHAEL DUXBURY, DEPUTY COMMISSIONER, DEPARTMENT OF PUBLIC
SAFETY, used an analogy to illustrate the differences in
Schedule 1A and Schedule 2A drugs.
Mr. Duxbury discussed the presentation, "Representing
Dosages of Opioids," (copy on file). He showed slide 2,
"1/10 gram = 1 dose." The slide showed a penny. He noted
that 1/10 gram was a dose to maintain an addiction. He made
note of the small size of the substance.
Mr. Duxbury advanced to slide 3, "Heroin Doses," which
showed various pictures. He drew attention to red box. He
emphasized that it took very little heroin to make a
person.
2:05:30 PM
Mr. Duxbury displayed slide 4, "Heroin Doses," which was
the same as the previous slide but with a box encapsulating
one gram of heroin. He noted that if there was fentanyl in
the heroin, there was propensity for harm in overdose.
Mr. Duxbury referenced slide 5, "Heroin Doses," which
showed the same photograph with a box. He drew attention to
the smaller amounts of the drug. He discussed the cost of
heroin in remote areas of the state.
Mr. Duxbury spoke to slide 6, "Lethal Dose of Fentanyl":
Fentanyl is 100 times more powerful than heroin
This represents a lethal dose of fentanyl
2:09:08 PM
Co-Chair von Imhof asked how a person made or acquired
fentanyl.
Mr. Duxbury stated that fentanyl was coming to the United
States from China, and often came through the mail. The
drug had begun coming from Mexico, as well as Canada.
Co-Chair von Imhof thanked Mr. Duxbury for the information
in his presentation.
Senator Micciche asked to go back to slide 3, and asked to
hear an explanation on the "user-dealer" and large dealer.
Mr. Duxbury stated that a person that was addicted and was
living on the street or barely functional would take a
number of doses and sell the rest in order to get money.
Senator Micciche asked how larger dealers were protected.
Mr. Duxbury wanted to juxtapose Senator Micciche's question
with another idea. He felt that a small amount of heroin
could still be considered of doing great harm. He stated
that if a person was capable was selling a small amount,
could sell a large amount.
2:15:49 PM
Senator Wielechowski agreed with Mr. Duxbury in the case
that fentanyl did not have reasonable use. He thought the
bill criminalized (in the fourth degree) morphine,
oxycodone. He wondered if he was reading the statute
correctly.
Mr. Duxbury thought the law and system did not have the
resources to take a person with one pill.
Senator Wielechowski wondered why one should give
prosecutors the ability to prosecute, when there is an
assumption that they would never pursue prosecution.
Mr. Duxbury reiterated that he was not saying the crime
would not be charged, rather he was referencing the effort
put into it. He stressed that there were many counterfeited
pills, sometimes made out of fentanyl to mimic other drugs.
2:20:07 PM
KELLY HOWELL, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF PUBLIC SAFETY, addressed FN 1 from
the Department of Public Safety, OMB component 3200. She
detailed that the note was a zero fiscal note.
Senator Micciche asked if the zero fiscal note reflected
that the department was not able to intervene in the
increase in crime.
Ms. Howell asked if Senator Micciche was referencing the
fiscal note related to the transmission of mental health
records from the Court System.
Senator Micciche stated that he did not see another
Department of Public Safety (DPS) fiscal note associated
with the bill.
Ms. Howell relayed that the department had not included
additional fiscal notes related to the additional work that
may or may not be related to the bill.
2:25:20 PM
Co-Chair von Imhof asked if DPS could receive records, or
whether DPS was asking for records.
Ms. Howell stated that the department was asking for the
records to be transmitted.
Co-Chair von Imhof stated that the committee would hear
more about the issue.
Senator Hoffman noted that Western Alaska had many
challenges; it was a vast area and his district was
extremely large. He stated that the drug problem was
growing, but alcohol abuse was still the number one
problem. He wondered whether the Launch program was still
intact.
Mr. Duxbury answered in the affirmative.
Senator Hoffman asked for the successes of the program and
a program description.
Mr. Duxbury stated that there was an issue with drug
enforcement work in every village. He used an analogy of a
shotgun shell as related to the drug issue in Western
Alaska. He stated that there was work in hubs, and move out
when there is a need to chase down a problem. There was
usually a focus on the transportation conduit like rivers
and snow machines.
2:30:15 PM
Mr. Duxbury continued to address Senator Hoffman's
question. He showed slide 4, and discussed successful
seizure of alcohol and drugs at the airport destined for a
community.
Senator Hoffman asked with the passage of SB 32, what
impacts on crime were anticipated.
Mr. Duxbury replied that focusing on one gram might help
him to save lives.
2:32:25 PM
SYLVAN ROBB, ADMINISTRATIVE SERVICES DIRECTOR, DEPARTMENT
OF CORRECTIONS, OFFICE OF MANAGEMENT AND BUDGET, spoke to
FN 6 from Department of Corrections, OMB component number
1381. She noted that the fiscal note did not address the
bill committee substitute, and the department was working
to update the note.
Co-Chair von Imhof appreciated discussing the fiscal note
with the understanding that it would change.
Ms. Robb stated that the majority of the fiscal note would
still stand. There was language in the analysis that
referenced DNA collection, which would be removed.
Co-Chair von Imhof queried the OMB number.
Ms. Robb replied that it was OMB 1318.
2:34:25 PM
Ms. Robb continued that the costs related to the fiscal
note were for the increased sentences. The estimates were
arrived using the number of offenders in the system for
2018, while looking back at the length of stay for similar
stays in 2014 since many parts of the bill went back to law
in place in 2014.
Co-Chair von Imhof noted that the fiscal note was broken
down into sections and showed an estimated increase in
inmates while referencing bill sections. She asked how many
additional inmates were estimated in total.
Ms. Robb stated that the department projected 465
additional inmates in the first year, and additional 523 in
the second year, and then an additional 528 in the third
year and beyond.
Co-Chair von Imhof asked if the state had the space for the
estimated increase in inmate population.
Ms. Robb stated that current operations did not allow for
those additional inmates.
Senator Wilson queried the current capacity.
Ms. Robb replied that the general capacity within the
system was 4664 beds, and a maximum capacity could only be
functional for 30 days before court standards. The maximum
capacity was 4838.
Senator Micciche asked if the state was at 92 percent of
prison capacity.
Ms. Robb replied in the affirmative, but it fluctuated from
day to day.
Senator Micciche surmised that there was room for 440 more
before maximum capacity.
Ms. Robb trusted that calculation. She reiterated that the
system was not able to operate at maximum capacity beyond
30 days.
Senator Micciche asked if maximum capacity included a
Palmer Correctional Facility.
Ms. Robb replied that it did not include the Palmer
Correctional Facility.
Co-Chair von Imhof queried the cost and capacity if the
state was to reopen the Palmer Correctional Facility.
Ms. Robb stated that the department had looked into
reopening the Palmer facility. The one-time cost to reopen
the facility was approximately $5.8 million. She stated
that many of the equipment and usable items had been
distributed to other institutions. She stated that the
fiscal note reflected the cost to run the facility, but did
not include the one-time cost.
2:40:41 PM
Co-Chair von Imhof asked for the cost to reopen the
facility.
Ms. Robb stated $5.8 million.
Co-Chair von Imhof queried the number of beds in the
facility.
Ms. Robb did not know the capacity.
Co-Chair von Imhof asked for an estimate of the beds in
Palmer.
Ms. Robb estimated several hundred.
Senator Wielechowski thought from FY 20 to FY 25 there was
roughly $245 million in additional costs, and wondered
whether it was anticipated that substantial additional
funds would be required to obtain the capacity to
incarcerate the offenders.
Ms. Robb stated that the additional cost required (assuming
capacity stayed the same) would be the one-time cost of
$5.8 million to re-open the Palmer facility.
Senator Wielechowski surmised that there was substantial
additional costs.
Ms. Robb stated that the additional cost to operate the
Palmer facility would be the one-time cost to reopen, which
was $1.8 million.
Senator Wielechowski wondered whether there would be
additional costs.
Ms. Robb replied that the cost to operate the facility was
reflected in the fiscal note.
Co-Chair von Imhof thought it might be necessary to re-open
the Palmer facility if the number estimated inmates
materialized. She hoped that the department was preparing a
tentative plan. She knew that the department had initially
proposed 500 inmates down south, and did not know of the
status of that proposal.
2:44:54 PM
Senator Wilson asked about if the numbers quoted included
the number of prisoners that would be exiting, and whether
they were first-time or repeat offenders.
Ms. Robb stated that it took into account that those were
in and out of the facilities over the course of that time
period.
Senator Wilson asked if the numbers of individuals entering
the system included first-time offenders or repeat
offenders.
Ms. Robb noted that it was all manner of offenders.
2:46:31 PM
Senator Wilson looked at Mr. Skidmore's presentation from
the previous day (copy on file). He thought some of the
violations were technical and wondered if adjustment would
lower the number.
Senator Wielechowski asked if there was a reason the fiscal
note did not reflect the $5.8 million needed to reopen the
Palmer facility.
Ms. Robb specified that the fiscal note was addressing the
governor's amended budget, which offered sending inmates
out of state.
Senator Wielechowski thought he heard Ms. Robb state that
there was no plan to send inmates out of state.
Ms. Robb reminded that the operating budget was currently
in the hands of the legislature.
Co-Chair von Imhof asserted that the committee was
considering SB 32. She thought it was important to have a
fiscal note that would address what was in the bill rather
than what was wanted by the governor.
2:50:30 PM
Senator Micciche thought it was important to keep in mind
that there were many beds in the system, and there were
many levers in the operation management that could not
result in overcrowding. He noted that DOC had taken a
conservative stance.
Ms. Robb stated that the length of sentence used in the
estimate was not based on the sentencing range, rather the
actual time-served was used to make the determination.
Senator Wielechowski wondered whether the number would
increase after the passage of the bill.
Ms. Robb stated that the fiscal note reflected the addition
of the extra inmates.
Senator Wielechowski considered that the number of
prisoners would increase by hundreds beyond the 2018
numbers.
Ms. Robb affirmed that the department limited projections
to that for which data was available.
Co-Chair von Imhof agreed that DOC was a down-stream
agency. She was not sure if the fiscal note reflected a
high range or medium range. She stressed the importance of
accuracy in the fiscal note.
2:56:40 PM
Senator Wielechowski thought Co-Chair von Imhof made a
great point. He thought the fiscal note was off by tens of
millions of dollars per year.
Co-Chair von Imhof suggested that Ms. Robb had an option to
provide fiscal ranges when updating the fiscal note.
Senator Micciche thought fiscal ranges were a good idea.
Senator Bishop encouraged the department not to "low ball"
the fiscal note.
Senator Wilson stated that the Palmer facility held
approximately 500 minimum to medium security inmates. He
stressed that the bills would hopefully address the
credits. He stressed that the numbers may go up in the
current bill, but there were other bills that could reduce
the cost.
3:01:12 PM
NANCY MEADE, GENERAL COUNSEL, ALASKA COURT SYSTEM, stated
that the Courts did not have a position on the policies
reflected in the bill. The one section of the bill that had
a great impact was Section 49, which required the Court to
provide old mental commitment orders DPS.
Ms. Meade thought other sections of the bill would lead to
increased filings, and would lead the Court to submit a
fiscal note.
Ms. Meade addressed FN 9 from the Judiciary.
3:07:09 PM
Senator Wielechowski asked about the typical caseload of a
Superior Court judge.
Ms. Meade replied that it varied depending on location, but
in Anchorage some have as many as 660 cases. She stated
that the smaller locations that sometimes conducted
district work saw substantially less numbers.
Senator Wielechowski stated that LAW submitted a fiscal
note that showed just for increasing on felony drug
offenses would result in 740 more cases. He wondered how
one additional judge would deal with all those cases, and
whether there should be additional judges.
Ms. Meade replied that it was unknown. She noted that the
misdemeanor cases had reduced in the last previous year.
3:09:47 PM
Co-Chair von Imhof knew that Ms. Meade had concerns about
the date of 1981 in the Section 49 of the bill relating to
submission of mental health commitments.
Ms. Meade explained that that problem with the old cases
was access. She noted that the change would cost additional
staff time to access the files. The need was not reflected
in the fiscal note.
Co-Chair von Imhof thought Ms. Meade had made a comment
about the cases.
Ms. Meade thought there was about 22,000 cases that needed
to be examined.
Co-Chair von Imhof hoped that Ms. Meade could work with LAW
to let the members know if the provision needed to be
addressed.
Senator Wielechowski asked if there had been analysis on
the impact on the number of cases that would be tried. He
thought when court fees were increased.
Ms. Meade stated there was no analysis of the increase in
trial rate.
3:14:32 PM
Senator Wilson asked if SB 91 changed global resolution of
charges.
Ms. Meade knew that plea bargains could be resolutions of
multiple charges.
Senator Olson thanked Ms. Meade for her straight-forward
answers. He thought some fiscal notes were lacking.
Co-Chair von Imhof asked members to work with her staff to
consider proposed amendments.
SB 32 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
3:18:27 PM
The meeting was adjourned at 3:18 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 04 23-25 19 LFD SFC Long-Term Plan-1.pdf |
SFIN 4/25/2019 9:00:00 AM |
LFD Fiscal Plan |
| 042519 SFIN LFD Fiscal Model Outputs.pdf |
SFIN 4/25/2019 9:00:00 AM |
LFD Fiscal Plan |
| SB 32 Representing Dosages of Opioids 04.25.19.pdf |
SFIN 4/25/2019 9:00:00 AM |
SB 32 |
| SB 32 New Fiscal Note LAW.pdf |
SFIN 4/25/2019 9:00:00 AM |
SB 32 |