Legislature(1995 - 1996)

03/10/1995 09:31 AM HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                         March 10, 1995                                        
                           9:31 a.m.                                           
  MEMBERS PRESENT                                                              
 Senator Lyda Green, Chairman                                                  
 Senator Loren Leman, Vice-Chairman                                            
 Senator Mike Miller                                                           
  MEMBERS ABSENT                                                               
 Senator Johnny Ellis                                                          
 Senator Judy Salo                                                             
 COMMITTEE CALENDAR                                                            
 SENATE BILL NO. 91                                                            
 "An Act creating the crime of criminal transmission of human                  
 immunodeficiency virus (HIV)."                                                
 Presentation by the Division of Public Assistance.                            
 SHES - 3/10/95                                                                
 SB  98 (PERSONAL RESPONSIBILITY ACT OF 1995) was scheduled, but not           
 heard this date.                                                              
  PREVIOUS SENATE COMMITTEE ACTION                                             
 SB 91 - See Health, Education & Social Services minutes dated                 
 SB 98 - See Health, Education & Social Services minutes dated                 
  WITNESS REGISTER                                                             
 Jim Nordlund, Director                                                        
 Division of Public Assistance (DPA)                                           
 Department of Health & Social Services (DHSS)                                 
 P.O. Box 110640                                                               
 Juneau, Alaska 99811-0640                                                     
 POSITION STATEMENT:  Reviewed the briefing document on Public                 
                      Assistance Programs.                                     
 Curt Lomas, Welfare Reform Program                                            
 Division of Public Assistance, DHSS                                           
 P.O. Box 110640                                                               
 Juneau, Alaska 99811-0640                                                     
 POSITION STATEMENT:  Offered additional information about the Adult           
                     Public Assistance Program.                                
 Randy Moore, Administrative Officer                                           
 Division of Public Assistance, DHSS                                           
 P.O. Box 110640                                                               
 Juneau, Alaska 99811-0640                                                     
 POSITION STATEMENT:  Discussed the Old Age Assistance Program.                
 Jim Dalman, Program Officer                                                   
 Food Stamp Claims Unit                                                        
 Division of Public Assistance, DHSS                                           
 400 W. Willoughby, Suite 302                                                  
 Juneau, Alaska 99801-1731                                                     
 POSITION STATEMENT:  Provided information about the Food Stamp                
                      Program, the Energy Assistance Program, and              
                      the Fraud Control Unit.                                  
 Val Horner, JOBS Program Officer                                              
 Division of Public Assistance, DHSS                                           
 P.O. Box 110640                                                               
 Juneau, Alaska 99811-0640                                                     
 POSITION STATEMENT:  Reviewed the Job Opportunities and Basic                 
                      Skills Program.                                          
  ACTION NARRATIVE                                                             
 TAPE 95-13, SIDE A                                                            
 SHES - 3/13/95                                                                
             SB  91 CRIMINAL TRANSMISSION OF HIV                             
 Number 003                                                                    
 CHAIRMAN GREEN called the Senate Health, Education and Social                 
 Services (HESS) Committee to order at 9:31 a.m. and introduced                
 SB 91  as the first order of business before the committee.                   
 SENATOR MILLER moved that the committee adopt the CS, Luckhaupt               
 3/9/95 version, in lieu of the original bill.                                 
 CHAIRMAN GREEN noted that the CS made the change talked about in              
 committee on Wednesday.                                                       
 SENATOR MILLER moved that the CS SB 91(HES) be moved out of                   
 committee with individual recommendations.  Hearing no objection,             
 it was so ordered.                                                            
 Number 026                                                                    
 CHAIRMAN GREEN informed everyone that the presentation by the                 
 Division of Public Assistance would be continued at this time.                
 JIM NORDLUND, Director of the Division of Public Assistance,                  
 introduced the various DPA personnel present at the meeting.  He              
 began his presentation on page 14 of the briefing document which              
 discussed the Adult Public Assistance (APA) program.  APA is a                
 supplement to the Federal Supplemental Security Income (SSI)                  
 program.  SSI helps elderly, blind, and disabled adults.  He                  
 specified that SSI payments are from the federal government and               
 given directly to the client.  APA then fills the remaining need to           
 the point of the needs standard.                                              
 CHAIRMAN GREEN inquired as to how the permanently disabled                    
 requirement would be a classification. CURT LOMAS, Welfare Reform             
 Program for DPA, said that the process is complex.  The definition            
 of permanently disabled is established federally and based on the             
 capacity to work.  Such factors as medical conditions,                        
 psychological conditions, work history, age, and other determinants           
 are reviewed in order to be classified as permanently disabled.               
 The Department of Education within the Division of Vocational                 
 Rehabilitation make these disability determinations.  Mr. Lomas               
 commented that the specifics would vary in relation to the illness.           
 The process to make the determination takes 60-90 days.  Mr. Lomas            
 pointed out that a number of the disability applicants do not                 
 initially qualify and more than half of those who appeal their                
 determination are eventually found to be eligible.                            
 CHAIRMAN GREEN asked if the problem was the specification of                  
 permanent.  CURT LOMAS explained that once disability is                      
 established due to a medical condition, the individual's prospect             
 for employment would be the basis for the determination.  The                 
 classification is tied to the individual's ability to earn a set              
 amount.  Mr. Lomas noted that there are periodic reviews once an              
 individual is found to be disabled in order to review eligibility             
 over time.  Assistance would be terminated if the individual's                
 capacity to earn increased over the minimum level.                            
 Number 126                                                                    
 JIM NORDLUND continued on page 14 by pointing out the chart in the            
 middle of the page.  He noted that the AFDC caseload has almost               
 leveled out, but that has not been the case with APA.  The most               
 significant factor regarding the APA population would be the state            
 population.  Page 15 reviews the eligibility criteria for APA.  The           
 need and maximum payment standards are located on page 16.  The               
 state pays up to the amount of the needs standard.  The amount of             
 the payment has remained the same.  The graphs on page 17                     
 illustrated a regular rise in caseloads and expenditures from the             
 fiscal years of 1990 to 1996 which seems to reflect the overall               
 growth in the population.                                                     
 RANDY MOORE, Administrative Officer for DPA, directed the committee           
 to page 14 which specified that 19.3 percent of those persons 65              
 and older received Old Age Assistance (OAA) in the fiscal year 1980           
 as compared to 14.2 percent in the fiscal year 1994.  He believed             
 that the growth of the APA population had exceeded the growth rate            
 of Alaska's population.                                                       
 Number 213                                                                    
 JIM NORDLUND continued his briefing with page 18 which presents the           
 graph information from page 17 in a different manner.  Page 18 also           
 points out the total savings resulting from the passage of HB 67.             
 The current fiscal year, 1995, will save $3,192.2 million.  Page 19           
 breaks down the APA cases according to the district area, race and            
 category.  He commented that this breakdown is similar to that of             
 CHAIRMAN GREEN inquired as to what interim assistance referred.               
 JIM NORDLUND explained that interim assistance payments are in lieu           
 of federal SSI payments.                                                      
 JIM NORDLUND moved on to the Food Stamp program on page 20.  The              
 Food Stamp program are funded 100 percent by the federal                      
 government.  He pointed out that the graph of the overall budget of           
 DPA on page 2 includes the Food Stamp program.  The state and                 
 federal government share the administrative costs 50/50 which                 
 equals approximately $7 million for Alaska.  He noted that the                
 amount of food stamps an individual receives is based in part on              
 their location; there is rural 1, rural 2, and an urban rate.  This           
 increases the complexity of the administration of the Food Stamp              
 JIM DALMAN, Program Officer for the Food Stamp Claims Unit, noted             
 that Alaska has specific language in the Food Stamp Act to cover              
 the three food stamp rates.                                                   
 SENATOR LEMAN asked if there was a list which specified which                 
 communities receive which rating.  JIM DALMAN said that he would              
 forward that information to the senator.                                      
 Number 277                                                                    
 JIM NORDLUND directed the committee to pages 21 and 22 which review           
 the eligibility criteria for food stamps.                                     
 JIM DALMAN explained that all food stamp applicants must meet the             
 resource and income standards.  The first test an applicant must              
 pass would be a gross income test.  If the applicant passes, then             
 a set of deductions are applied.  The next test would be the net              
 income test which if they pass then the applicant's resources are             
 CHAIRMAN GREEN asked if waivers were available.  JIM DALMAN stated            
 that waivers would be available to some degree; there would be more           
 flexibility than with the AFDC program.  The Food Stamp program has           
 more specific rules encompassed within the Food Stamp Act.  He                
 noted that waivers can be requested if things are not specified in            
 the act.                                                                      
 JIM NORDLUND directed the committee to page 23 which discusses the            
 standards and maximum allotments for food stamps.  Page 24 presents           
 graphs which illustrate the case load and benefit growth from the             
 fiscal years 1990 to 1996.                                                    
 CHAIRMAN GREEN asked if the administrative costs remain constant.             
 JIM DALMAN said that administrative costs remain fairly constant,             
 but those costs would reflect increased salaries, new components,             
 and various other aspects affecting administrative costs.                     
 JIM NORDLUND asked if Alaska's share of the administrative costs              
 was driven by a formula.  JIM DALMAN replied that in part, that               
 would be correct.  Most of the federal programs are based on a time           
 study, the amount of time workers spend on the various programs as            
 well as other incidental costs.  Mr. Dalman clarified that most of            
 the workers perform multiple program eligibility.                             
 JIM NORDLUND continued the briefing with page 25 which contains               
 graphs illustrating the food stamp cases by district area, race,              
 and category.  He began the portion of the packet regarding the Job           
 Opportunities and Basic Skills (JOBS) program on page 26.  The                
 program was mandated by the federal government in the passage of              
 the Family Support Act of 1988.  The focus of the JOBS program is             
 to encourage AFDC recipients into work related activities and                 
 employment.  The program is proving to be effective in reducing               
 caseload.  He directed the committee to the graph at the bottom of            
 page 28 which illustrates that the number of AFDC recipients                  
 finding work is increasing.  He mentioned that the JOBS program               
 would be facing a $500,000 cut in federal funding.  This program is           
 successful and an investment in the long-term.                                
 Number 376                                                                    
 VAL HORNER, JOBS Program Officer for DPA, explained that the                  
 program began as a career oriented program with long-term education           
 and employment goals.  She pointed out that the emphasis on long-             
 term education had changed.  The graph on page 27 regarding JOBS              
 participants and the graph on page 28 regarding JOBS parents                  
 finding work both illuminate that change in philosophy.  The JOBS             
 program now focuses on helping clients become job ready as well as            
 helping those who are job ready to become active and trained in the           
 skills necessary for job searching.  Through vocational counseling            
 and the identification of a client's skill, realistic employment              
 goals are produced which encourage entry level employment and                 
 gaining experience.  Participation leading toward employment is               
 Ms. Horner specified that the JOBS program relies on multiple                 
 agencies such as JTPA and the Department of Labor in order to                 
 operate the program.  The program focuses on employment                       
 opportunities available in the client's community.  She pointed out           
 that currently the clients consisted of a significant amount of               
 two-parent families rather than the single family of the past.  She           
 explained the process in which the JOBS program obtains its                   
 clients.  The program serves six areas and targets the non-Native             
 population; the Native population is served by a Native JOBS                  
 program which receives federal funding.  In conclusion, Ms. Horner            
 emphasized that the JOBS program focuses on moving clients towards            
 employment by increasing educational levels, vocational training,             
 and overcoming family issues which are barriers to employment.                
 Number 436                                                                    
 CHAIRMAN GREEN inquired as to the process of receiving the various            
 services from the different agencies; would the client be referred            
 to different offices in different buildings.  VAL HORNER said that            
 going to different offices could happen, but that would depend upon           
 the needs of the client.  In Ketchikan, all the offices are located           
 in the same building.                                                         
 CHAIRMAN GREEN asked if while a client was in the JOBS program                
 would the client receive full benefits in order to maintain a basic           
 lifestyle.  VAL HORNER said that a client would receive an AFDC               
 check while in the JOBS program.  When a client begins paid                   
 employment the amount of the AFDC would be decreased in relation to           
 the client's income.  CHAIRMAN GREEN clarified that this would be             
 a form of transition.  VAL HORNER noted that the program provides             
 supportive services such as child care, transportation assistance             
 as well as paying for some professional licensing fees and work               
 clothing.  These services are only provided when a client works               
 toward employment.                                                            
 CHAIRMAN GREEN inquired as to the percentage of federal support               
 which would be withdrawn.  JIM NORDLUND said that nationwide                  
 federal support would be reduced from $1.3 billion to $1 billion.             
 VAL HORNER emphasized that the federal reduction is a scheduled               
 SENATOR LEMAN asked if there was information regarding the cost of            
 the program based on the number of jobs created.  VAL HORNER said             
 that there is such information.  In Alaska, the development of a              
 work site costs approximately $1,200.  Child care costs, the most             
 significant barrier to employment, increase the cost of the                   
 program.  Ms. Horner stated that the program is worthwhile and does           
 pay for itself.  In response to Chairman Green, Ms. Horner agreed             
 to forward the committee a list of the specific ways in which                 
 clients receive assistance.                                                   
 SENATOR LEMAN pointed out that a review of the cost per job could             
 prove valuable in the delivery of the service.  Another aspect of             
 concern regarding the cost per job would be the length of time a              
 client remains in the job market for the job that was created.  He            
 indicated that both of those aspects could illuminate the                     
 effectiveness of the program.                                                 
 Number 509                                                                    
 VAL HORNER noted that since the JOBS program is fairly new there is           
 not enough history available to do accurate comparisons.  She                 
 directed the committee to the chart discussing welfare savings on             
 page 28.  Employers' reports from the Department of Labor allows              
 the JOBS program to accurately compare clients and their ongoing              
 employment activities.  She felt that the most important aspect of            
 that comparison would be that the client had remained employed,               
 whether or not the client remained in the same job was not as                 
 Ms. Horner emphasized that the effectiveness of the JOBS program              
 goes further than dollar measurements.  The program changes the               
 lives of these people and their children, they are given dignity.             
 SENATOR LEMAN stated that needy people can be helped and changed if           
 they are given more dignity by taking care of their needs                     
 personally rather than through corporate government assistance                
 programs.  He agreed with the concept of the program, however, he             
 was not as convinced of the effectiveness of the program.                     
 VAL HORNER acknowledged Senator Leman's concerns, but the                     
 significant growth in 1994 supported her belief in the program.               
 She noted that she had researched employment and training programs            
 and their effectiveness.  States with programs that do not offer              
 any education result in clients who may gain employment quickly,              
 but they do not retain their employment.  The Riverside project in            
 California illustrates that long-term college education and short-            
 term vocational training basically net the same results.  She                 
 explained that for Alaska, short-term education with a focus on               
 employment would be the most cost effective approach.  The program            
 is going in that direction.                                                   
 Ms. Horner noted that the JOBS program provides a work fair program           
 which mandates that a two-parent family participate in community              
 service.  The program also requires that clients combine                      
 activities.  Each individual participates up to 40 hours a week.              
 She explained that once a client is in the program, the client                
 would be required to take public service employment if that client            
 has remained unemployed under the program for two to four days.  If           
 the client does not participate, the family loses their AFDC                  
 Number 575                                                                    
 CHAIRMAN GREEN asked if there was an effort to avoid duplication.             
 VAL HORNER said yes, everyone works hard to avoid duplication.                
 JIM NORDLUND recognized the debate between the effectiveness of               
 long-term versus short-term training.  He addressed Senator Leman's           
 concern by pointing out that training a client toward a four year             
 degree, the client would seem less likely to return to welfare                
 because they would be moving into a better job.  He felt that the             
 emphasis in Alaska should be employing people.                                
 TAPE 95-13, SIDE B                                                            
 Number 590                                                                    
 CHAIRMAN GREEN asked if the clients of the JOBS program had been              
 directed into the program or had they asked to participate in the             
 program.  VAL HORNER said that both scenarios occur.  Ms. Horner              
 agreed with Chairman Green that the JOBS program would not                    
 necessarily be voluntary.  Ms. Horner also concurred with Chairman            
 Green that the JOBS program can be a requirement which if not                 
 fulfilled would lead to the loss of benefits to the client.  There            
 are a lot of factors which would determine whether the client would           
 have the JOBS program as an option or a requirement.                          
 Ms. Horner mentioned that one of the serious problems was the                 
 education level of the clients.  Most clients are at a six grade              
 level.  Approximately 40 percent of the clients do not have a                 
 diploma or GED.  Ms. Horner said that their goal was to educate               
 these people up to at least the ninth grade level.  Participation             
 in the adult basic education program is required.  She pointed out            
 that through the testing for basic literacy - which everyone must             
 take, even those who were high school graduates - they have found             
 that the majority of clients have an education below the eighth               
 grade level.                                                                  
 SENATOR LEMAN reiterated Ms. Horner's statement that these low                
 education levels also include individuals with high school                    
 diplomas.  VAL HORNER specified that nearly 30 percent of the                 
 clients have a high school education and 40 percent do not have a             
 high school education.  Ms. Horner said that the problem with                 
 education should be attacked in the schools as well; by the time              
 these individuals reach the JOBS program, it is almost too late.              
 Number 554                                                                    
 SENATOR LEMAN said that it was obvious that there is not enough               
 money being spent on education if 30 percent of the division's                
 clients cannot read well.  VAL HORNER supported school to work.               
 CHAIRMAN GREEN requested more information regarding the statistics            
 Ms. Horner mentioned about the educational status of their clients.           
 VAL HORNER mentioned that the Department of Education and the                 
 Department of Labor are major partners in the JOBS program.                   
 CHAIRMAN GREEN inquired as to the percentage of AFDC clients that             
 participate in the JOBS program.  JIM NORDLUND said that it was               
 approximately 30 percent.  Page 27 could be used to compare the               
 JOBS caseload versus the overall AFDC caseload which works out to             
 be approximately 15 percent.                                                  
 CURT LOMAS pointed out that the Native JOBS programs serve numerous           
 persons who are not reflected in these statistics.  VAL HORNER                
 noted that the Native JOBS programs are accountable to their                  
 federal agency.                                                               
 VAL HORNER commented on the growth the JOBS program has felt.                 
 There have been various intensive audits of the program within the            
 last nine months.  She pointed out that adding clients to the                 
 caseload does not guarantee employment because time is needed in              
 order to work with the clients to achieve employment.  There would            
 be a point at which the staff would be maxed out and the                      
 effectiveness in dealing with their clients will decrease                     
 dramatically.  She informed the committee that nationally, the                
 effective caseload size is about 85 and 90.  They are reaching the            
 maximum capacity where effectiveness would be lost and placement              
 would become a paper shuffle.                                                 
 JIM NORDLUND noted that the cap would be reached quickly with the             
 $500,000 federal cut.  This is why the division has a budget                  
 request for $500,000 in order to maintain the program at the                  
 current level.  VAL HORNER reiterated that they were rapidly                  
 reaching the maximum capacity to effectively place people in                  
 employment with the current number of staff.                                  
 CHAIRMAN GREEN asked if the staff was increased, could the number             
 of clients be increased.  VAL HORNER said yes.                                
 Number 485                                                                    
 JIM NORDLUND reviewed pages 27 and 28.  He continued his briefing             
 with the Energy Assistance Program (EAP) which begins on page 29.             
 The EAP is 100 percent federally funded program which is utilized             
 mainly in the winter months.  Some staff are laid off in the summer           
 JIM DALMAN explained that EAP gives a one time grant per year.  EAP           
 serves the working poor who may not be served under other programs.           
 He informed the committee that last year 4,700 AFDC households were           
 involved in EAP of the 14,000 clients that were served.  There are            
 tribal grantees that receive direct federal funding.  He said that            
 all of the payments made by EAP are mainly vendor payments.  He               
 pointed out that EAP has had a continuous decline in funding due to           
 its block grant situation.  EAP faces increased caseloads while               
 benefits and federal funding decrease.                                        
 CHAIRMAN GREEN asked if there was any cost to the state for this              
 program.  JIM DALMAN restated that EAP is 100 percent federally               
 funded.  SENATOR LEMAN asserted that those federal funds come from            
 somewhere.  JIM DALMAN agreed, but pointed out that these funds do            
 not come from the general fund.                                               
 JIM NORDLUND directed the committee to page 30 which discusses the            
 General Relief Assistance (GRA) program.  The needs standard for              
 this program is very low; GRA serves as a last resort.  Half of the           
 budget for this program is applied to burials for indigent persons.           
 CURT LOMAS pointed out that the remaining 50 percent of this                  
 program's budget is used for rental assistance for the homeless or            
 those who are close to eviction.  The maximum benefit for GRA is              
 $120 per month per person.  GRA is not a long-term program, a                 
 person much apply each month the assistance is needed.                        
 Number 414                                                                    
 JIM NORDLUND noted that the remainder of the packet addressed the             
 Fraud Unit of DPA which is under the charge of Jim Dalman.                    
 JIM DALMAN pointed out that 40 percent of the Fraud Control Unit              
 Staff had to be laid off last year which leaves the unit short-               
 handed.  He noted that there was an increment proposal in order to            
 restore four investigator positions lost to federal funding cuts              
 last year.  He reviewed the three main functions of the Fraud                 
 Control Unit:  investigations, administrative disqualification                
 hearings, and claims processing and collection.  He reported that             
 the two investigator sub-unit of the early fraud detection                    
 investigations, located only in Anchorage, avoided costs in excess            
 of $2 million.  The cost avoidance for the fiscal year 1994 was               
 $3.6 million.                                                                 
 Fraud deterrence is important in the approach to accountability               
 with these programs.  Mr. Dalman informed the committee that the              
 Fraud Unit was reorganized a few years ago which resulted in                  
 improvements in process, productivity and cost savings.  Even with            
 the federal cuts of last year, the unit streamlined and                       
 productivity was not effected.                                                
 SENATOR LEMAN inquired as to the possibility of contracting some of           
 that work.                                                                    
 Number 347                                                                    
 JIM DALMAN recognized that some states have contracted such work              
 with mixed success.  The reorganization of the unit resulted in the           
 reclassification of investigators down to a lower pay range, and              
 recruited many experienced eligibility technicians and persons with           
 investigative backgrounds.  These people have been very productive            
 with costs that are not extreme.  He informed the committee that              
 the budget increment to add four investigator positions would be              
 approximately $240,000.  Knowing this business from the inside out            
 is a definite advantage.                                                      
 Mr. Dalman felt that the current operation was very efficient.  The           
 past reorganization and the advent of the disqualification hearings           
 provides a more streamlined approach.  Fewer cases are taken to               
 prosecution which cuts a lot of the costs.  He noted the broad                
 support for the Fraud Unit.  Contracting probably would not result            
 in a much more cost efficient system.  The current positions are              
 making money.  Currently, the unit is short-handed and faces a                
 backlog which lead to the need for additional positions.  He                  
 emphasized that fraud is happening, but that it is not an epidemic.           
 JIM NORDLUND pointed out that the fraud investigators are recruited           
 from the eligibility technicians which are trained from six months            
 to a year.  Contractors would not have this background.  Mr.                  
 Nordlund was not convinced that contracting would result in a                 
 better productivity.  JIM DALMAN reiterated that the past                     
 reorganization resulted in greater productivity at a decreased                
 SENATOR LEMAN referred to the recent spy case when he stated that             
 he hoped that the fraud unit could achieve better and quicker                 
 results than the CIA did with that case.  JIM DALMAN noted that               
 each office does home visits which serve to recognize red flags               
 such as certain lifestyles which would indicate fraud.                        
 Number 256                                                                    
 CHAIRMAN GREEN felt that an investigator's effectiveness must                 
 increase when they actually live in the community in which they               
 serve.  Currently all the investigators are in Anchorage.  She                
 suggested that even part-time investigators would be more effective           
 if they lived in the community they served.  JIM DALMAN explained             
 that there are referrals from each office in the community.                   
 JIM NORDLUND stated that he had an administrative organization                
 break down by region.  The largest job classification of DPA would            
 be the eligibility technicians who are located in the offices of              
 the five regions.  He reviewed the various offices and their                  
 There being no further business before the committee, the meeting             
 adjourned at 10:50 a.m.                                                       

Document Name Date/Time Subjects