Legislature(2001 - 2002)
04/10/2002 01:52 PM Senate HES
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ALASKA STATE LEGISLATURE
SENATE HEALTH, EDUCATION & SOCIAL SERVICES COMMITTEE
April 10, 2002
1:52 p.m.
MEMBERS PRESENT
Senator Loren Leman, Vice Chair
Senator Gary Wilken
Senator Jerry Ward
Senator Bettye Davis
MEMBERS ABSENT
Senator Lyda Green, Chair
COMMITTEE CALENDAR
SENATE BILL NO. 346
"An Act relating to statewide school district correspondence
study and state supported home schooling programs."
SCHEDULED BUT NOT HEARD
CS FOR HOUSE BILL NO. 402(FIN)
"An Act relating to diversion payments, wage subsidies, cash
assistance, and self- sufficiency services provided under the
Alaska temporary assistance program; relating to the food stamp
program; relating to child support cases that include persons who
receive cash assistance or self-sufficiency services under the
Alaska temporary assistance program; and providing for an
effective date."
MOVED SCS HB 402(HES) OUT OF COMMITTEE
SENATE BILL NO. 311
"An Act relating to the public school trust fund, the Alaska
children's trust, and the Alaska heritage endowment fund; and
providing for an effective date."
SCHEDULED BUT NOT HEARD
PREVIOUS COMMITTEE ACTION
SB 346 - See HESS minutes dated 3/15/02, 3/18/02 and 4/8/02.
HB 402 - See HES minutes dated 4/10/02.
SB 311 - See HESS minutes dated 4/8/02 and 4/15/02.
WITNESS REGISTER
Representative Fred Dyson
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Presented HB 402
Ms. Sandy Hoback
American Institute for Full Employment
POSITION STATEMENT: Answered questions about HB 402
Ms. Ellie Fitzjarrald
Chief, Policy and Program Development
Division of Public Assistance
Department of Health &
Social Services
PO Box 110601
Juneau, AK 99801-0601
POSITION STATEMENT: Answered questions about HB 402
Mr. Elmer Lindstrom
Deputy Commissioner
Department of Health &
Social Services
PO Box 110601
Juneau, AK 99801-0601
POSITION STATEMENT: Stated the department does not support any
cap in HB 402.
ACTION NARRATIVE
TAPE 02-27, SIDE A
Number 001
VICE-CHAIR LOREN LEMAN called the Senate Health, Education &
Social Services Committee meeting to order at 1:52 p.m. Senators
Wilken, Ward and Leman were present. Vice-Chair Leman announced
that Chairwoman Green was ill. He then announced that the
committee would take up CSHB 402(FIN) and asked Representative
Dyson to present.
SENATOR WARD asked if CSHB 402(FIN) leaves the cap at 20 percent.
REPRESENTATIVE FRED DYSON, Chair of the House Health and Social
Services Committee, made the following statement.
That limit is certainly a contentious issue. The
Department [of Health and Social Services] wanted to
take the limit off entirely and it all has to do with
the limit and the percentage of recipients who can have
their benefits extended past 60 months - which is not
only the federal but our state's requirement - the
department wanted to take that off entirely and can
make an, I think, eloquent case for that and they were
basically saying trust us, we don't want to make the
people dependent, we don't want to carry them on the
roles but there are some hard core folks with
disabilities and other problems that just can't go on
to self-sufficiency. I was uncomfortable doing that. I
think that under Mr. Nordlund's administration my sense
is that it would work to not carry anybody that
shouldn't be and so on. I didn't feel comfortable about
taking the limits off. I made a guess of what I thought
might be the number or the percentage of hard core
unemployed who will continue to need the [indisc.] and
in House Finance I made that change to 33 percent, up
from the present 20. Sandy Hoback here from Oregon, who
has an immense amount of experience said pretty good
guess. They found in Oregon that over the years about a
third of the folks could not achieve complete self-
sufficiency - a judgment call.
VICE-CHAIR LEMAN asked if there was any technical basis for
deriving the 33 percent based on Alaska's caseload or whether it
was based on Oregon's experience. He said he looks at it as
asymptotically coming to a number and is wondering if someone
went through an exercise to come to the 33 percent.
REPRESENTATIVE DYSON said it was based on Oregon's experience and
noted the department has held the position that it prefers no
limit.
SENATOR WARD asked if there will be any damage during the
upcoming election if the 20 percent is maintained.
REPRESENTATIVE DYSON said that the department says it will have
clients reaching the 60-month limit this summer and that some of
them should have continued benefits but may bump up against the
20 percent. He asked that the department argue that point. He
said he has held the position that if he is re-elected, he will
be paying attention to whether the number needs to be changed in
the future.
SENATOR WARD said he agrees with that position.
REPRESENTATIVE DYSON said it looks to him like the department has
done a pretty good job of getting people off of welfare. He
explained that the main portions of CSHB 402(FIN) create another
paradigm shift in how the business of welfare is done. Under Ms.
Hoback's administration in Oregon, the culture of welfare was
changed to work first, rather than what benefits clients were
eligible for. He believes lumping cash benefits and food stamps
into a fund to subsidize employment to be a profound change. The
State of Oregon took the initiative to subsidize jobs to help
people learn a trade and get employed. That is a significant
departure from what most states have done. He is pleased that
this Administration, particularly Mr. Nordlund, has gone from
being reluctant to enthusiastic. Another change that the State of
Oregon made, which he considers to be genius, was to pay
contractors for performance instead of shuffling papers. He noted
CSHB 402(FIN) will allow the department to do those things.
Although he shares Senator Ward's concern about the 20 percent
limit, the importance of CSHB 402(FIN) lies with the paradigm
shift in how temporary assistance is administered.
VICE-CHAIR LEMAN said that Representative Dyson inadvertently
gave credit to what the legislature has done with its missions
and measures directive. It told this department how its
performance would be measured and the department followed-up.
SENATOR WARD commented that CSHB 402(FIN) is a fine step that he
completely endorses. He said he also knows that if the
legislature does not keep the pressure on, things may not work
out as the legislature intended.
1:50 p.m.
MS. SANDY HOBACK, a consultant with the American Institute of
Full Employment, a non-profit corporation, informed members that
the Institute did an assessment of Alaska's welfare reform
efforts last summer and made a number of recommendations at the
request of Senator Green and Representative Dyson. The statutory
recommendations are incorporated into CSHB 402(FIN). The
committee has heard a similar bill on this topic, SB 346. The
only difference between the two bills is the cap. The cap in
CSHB 402(FIN) was changed from 20 to 33 percent. She has worked
diligently with Representative Dyson's and Senator Green's
offices on drafting these bills and negotiating with the
department on parts of it. She commented that the department has
made a number of concessions to get us to this point, and she
applauds department staff for their efforts in not only embracing
the statutory changes, but for embracing the operational
recommendations in the report to make this system much more
accountable. She offered to answer questions.
SENATOR WARD commended all involved but repeated his concern
about increasing the cap to 33 percent. He asked what harm, if
any, will be done to any Alaskans between now and next January if
the cap is returned to 20 percent.
MS. HOBACK replied that based on the department's projections, it
is not predicting it will hit the 20 percent ceiling.
SENATOR WARD said that was his reading. He thanked Ms. Hoback and
those involved for taking a complex subject and putting it into
an easily understood format.
VICE-CHAIR LEMAN referred to a chart of DHSS's projections and
agreed that the increase to 33 percent is not necessary for this
next fiscal year.
SENATOR WARD said it may be necessary the following year.
SENATOR DAVIS arrived.
VICE-CHAIR LEMAN thanked Ms. Hoback and asked a representative of
the Department of Health and Social Services to testify.
MS. ELLIE FITZJARRALD, Chief of Policy for the Division of Public
Assistance, said the department has made a number of concessions
to support the legislation before the committee but it will need
to reconsider if further amendments are made.
VICE-CHAIR LEMAN asked Ms. Fitzjarrald if the department did any
calculations to cause committee members to believe that 33
percent is an appropriate number to use as the new cap.
MS. FITZJARRALD said the department did not do any calculations.
It worked with Representative Dyson and Senator Green on going
forward with no cap, partially based on the fact that the 20
percent cap in federal law is an arbitrary number. Because of the
significant decline in the caseload in Alaska, as well as
nationally, 20 percent of the 1996 caseload was much higher than
it is today. Since 1996, the caseload has dropped 40 percent so
20 percent of the remaining caseload is much smaller. The
department has taken the position that any family that qualifies
for an exemption under the current law and meets the criteria for
an extension of benefits should get it. The department does not
want to be put in the position of having to prioritize who gets
an exemption based on the severity of their situation. The
department hoped to get rid of the arbitrary number, follow the
current law, regulate on it, and grant an extension to those who
meet the criteria. A House committee discussed this issue and,
as Ms. Hoback testified, the 33 percent was determined from the
State of Oregon's experience.
VICE-CHAIR LEMAN said a 5 percent variance from 20 percent would
carry the program through FY 04, based on the department's
projections, without any cut-off occurring. He commented that the
increase to 33 percent is not necessary this year but a 5 percent
increase would cover the next two years and give a future
legislature time to review progress and decide whether that
amount should be changed.
MS. FITZJARRALD said that is correct and it is all based on what
happens to the caseload. She pointed out that basing the cap on
20 percent of the caseload acts as a disincentive to decrease the
caseload.
SENATOR WARD said he plans to propose that the committee reduce
the cap to 20 percent, unless the department can give him a
reason not to. He said he does not want to harm anyone, but he
believes leaving the 20 percent cap in place until next January
will not do any harm.
MS. FITZJARRALD said she cannot guarantee that it will do no harm
but, based on what the department knows from its five years of
experience with this program, and considering the factors of the
clients who have remained on the program for that time and the
economy, the department is projecting that no families will be
cut off from benefits because of the 20 percent limit next fiscal
year.
SENATOR WARD moved to change, on page 10, line 29, 33 percent to
25 percent.
SENATOR WILKEN asked if the 33 percent came from Representative
Dyson's best guess coupled with Ms. Hoback's professional
expertise.
REPRESENTATIVE DYSON answered affirmatively.
SENATOR DAVIS stated:
I guess the maker of this motion is going to speak to
as to why he thinks it should be 25 rather than 33
because what you're doing is thinking, well, 25 will
work because 20 should work but we don't know that. And
we have the opportunity to do something with this bill
now. We don't have to wade back and second, it's not
costing us any money to do what we're doing now and why
should we have to put it off until even next January,
which means January could move into May and May could
move into the next year and we still have the division
in limbo. I think that the division has worked very
well trying to make sure that they do something that's
going to be in the best interest of the people that
they serve. And then we have expert people that have
come here and have worked with us and say, look you
know, they started this thing off wanting us not to
have a cap at all - said that we will work in those
confines and then we will be able to work the situation
out and then when you decided that you didn't want that
they came up with a number that seemed to be a good
number and now we want to make it to be 25 when we, as
legislators, don't know if that will work or not work.
You'd think we would listen to the experts and go with
what we have rather than us, as legislators, who are
supposed to be policy makers and making good decisions
rather than just second-guessing. Why put it off this
year what you can do next year and what are we gaining
by doing this?
SENATOR WARD replied that Senator Green said that she arbitrarily
picked the 20 percent out of the air and Representative Dyson
arbitrarily chose 33 percent. His motion was based on testimony
that no one will be harmed at 20 percent but he added five
percent to make sure no one is harmed. If re-elected, he will
address the issue next year. His motion is designed to continue
pressure on the program while ensuring that no one is harmed.
SENATOR WILKEN asked where the federal government stands on this
number.
MS. FITZJARRALD said the President's proposal keeps the 20
percent cap. Other legislation has been introduced with no
changes on the federal level to the 20 percent cap although there
has been recognition that many other states have been using state
funds to provide benefits to families who will get cut off
because of the 20 percent cap. She added that many states do not
have a time limit in their state laws.
VICE-CHAIR LEMAN said in response to Senator Davis's comments, he
is willing to support the 25 percent because it provides coverage
for two fiscal years during which trends can be observed.
SENATOR WILKEN asked Representative Dyson what number he prefers.
REPRESENTATIVE DYSON said that he and Senator Green asked the
Institute to do the report and he, like Senator Ward, is very
impressed with the work that has been produced and the
Administration's response to it. Regarding Senator Wilken's
question, he stated:
Back to the question at hand, I went through a process
not unlike the Chair here in trying to figure out
what's this negative regression that's headed for some
kind of a horizontal asymptote out there would be and I
can't - and every state is going to be different and we
will see the accuracy in retrospect better than we do
now. It certainly depends on the culture and attitude
of the people administering it. I think that's part of
what motivates Senator Ward, is wanting to keep some
pressure on there and it's what made me a bit uneasy
about taking the cap off. With Mr. Nordlund in charge,
I feel quite comfortable that he's headed in the right
direction. If I got appointed to a conference committee
here, and it came out of here 20 percent and we had had
33, I would have done virtually what you're doing and
I'd say, okay, let's get this thing done and make sure
it's in place, cut the baby in half, which would have
been 27.5 percent.
REPRESENTATIVE DYSON said the reason Alaska will see this more
accurately in retrospect is because it is unique. He commented
that he questioned Mr. Nordlund quite closely about whether the
department would let people get their benefits extended when the
only thing that is keeping them from working is that there are no
jobs in their town. Mr. Nordlund said absolutely not. If there
is no employment in a client's town, that client will have to
move. Mr. Nordlund said the department is not in the business of
supporting someone to live in a place where no jobs exist.
Representative Dyson said he was comfortable with the 30 percent
that he put up but Representative Davies suggested 33, based on
Oregon's experience. He said he believes committee members are
correct in that the 25 percent will ensure that no one is harmed.
SENATOR WILKEN asked Representative Dyson if 25 percent is
acceptable to him.
REPRESENTATIVE DYSON said it is and asked that the committee hear
from Mr. Lindstrom.
MR. ELMER LINDSTROM, Deputy Commissioner of the Department of
Health and Social Services, said he doesn't know an asymptote
from a cord of wood, but he is aware of the history of HB 402 and
would like to share it with members. A bill was introduced in
both the House and Senate last session by the Governor. Both
bills included a repeal of the 20 percent cap and other minor
provisions. A bill ultimately passed the House that included a
number of acceptable provisions but did not include any amendment
to the 20 percent cap. An assurance was given that the repeal of
the cap would be taken care of this year. Now the committee is
deliberating a "nice package of stuff" from the report - most of
which the department would have pursued if left to its own
devices as they make sense. However the 20 percent cap issue
still remains the key to the department's ability to support the
bill. He said he respects Senator Ward's comment that if re-
elected he will work diligently to address the cap next year, but
as a stand alone proposition, amending or removing that 20
percent cap will not be a politically easy or attractive issue to
deal with. He believes it is better for everyone to look at it as
part of a well balanced package before the committee today. He
said regarding the question about whether the department supports
the 33 percent limit, the answer is a reluctant yes, but the same
thing can be said of a 20 percent cap, nor is he certain about
the 25 percent. He maintained that it is a deal that keeps
getting cut thinner and thinner and is problematic for the
department at this point.
SENATOR WARD said he appreciates all of the work Mr. Lindstrom
has done on this bill and if he is here next year he will address
the cap. He stated that at 25 percent, not one Alaskan will be
harmed for the next two years and the new legislators will be
able to look at the actual numbers and decide which arbitrary
number is the best. He indicated the reality is that no one wants
anyone to fall off of the benefit program if they have
extraordinary circumstances. He maintained his motion and said he
looks forward to speaking to the Governor about this issue.
SENATOR DAVIS commented that the previous speaker stated what he
will do when he comes back, but there is no way to know the
future and who will be here. She believes the point made about
this bill being a package deal is something the committee needs
to take into consideration. She maintained this package is well
balanced and has been reviewed by the department and expert
consultant. All gave it their best recommendation. She expressed
concern about having to come back and deal with the cap and noted
that the current President has done nothing to lift the 20
percent federal cap and that other states are already making up
the difference by using state monies. Alaska is not at a point
where it is willing to do that. If this issue is dealt with as a
package, the state will get better results. No one knows what the
climate will be next year. She said the Administration has said
it prefers no cap so to keep knocking the number around when all
numbers are arbitrary is not in the best interest of the people
being served.
SENATOR WILKEN called for a brief at-ease.
VICE-CHAIR LEMAN called the meeting back to order and announced
that the committee has an amendment before it.
SENATOR DAVIS maintained her objection to the amendment.
VICE-CHAIR LEMAN asked for a roll call vote. The motion to adopt
the amendment carried with Senators Wilken, Ward and Leman voting
in favor, and Senator Davis opposed.
There being no further amendments or discussion, SENATOR WARD
moved SCS CSHB 402(HES) from committee with individual
recommendations and its accompanying fiscal note. There being no
objection, VICE-CHAIR LEMAN announced the bill will move to the
next committee of referral. He then announced the committee will
meet jointly with the House Health and Social Services Committee
on April 11 to hear the Suicide Prevention Council report and it
will meet on Friday, April 12 to continue the hearing on
Kivalina. He then adjourned the meeting at 2:20 p.m.
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