Legislature(1997 - 1998)
02/13/1997 03:34 PM Senate STA
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
SENATE STATE AFFAIRS COMMITTEE
February 13, 1997
3:34 p.m.
MEMBERS PRESENT
Senator Lyda Green, Chairman
Senator Jerry Ward, Vice-Chairman
Senator Jerry Mackie
Senator Mike Miller
Senator Jim Duncan
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE JOINT RESOLUTION NO. 14
Relating to support for federal legislation permitting state
concealed handgun permittees to carry concealed handguns in other
states.
- MOVED SJR 14 OUT OF COMMITTEE
SENATE BILL NO. 46
"An Act naming a new maritime vessel for the Alaska Marine Highway
System; and providing for an effective date."
- HEARD AND HELD
SENATE BILL NO. 68
"An Act relating to the Task Force on Privatization; and providing
for an effective date."
- CSSB 68(STA) ADOPTED AND MOVED OUT OF COMMITTEE
PREVIOUS SENATE COMMITTEE ACTION
SJR 14 - No previous action to record.
SB 46 - See Senate Transportation Committee minutes dated 2/4/97.
SB 68 - No previous action to record.
WITNESS REGISTER
Bill Stoltze, Staff to Senator Rick Halford
State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Offered information on behalf of sponsor of
SJR 14
Senator Jerry Ward
State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Prime Sponsor of SB 68
Craig Johnson, Staff to Senator Ward
State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Offered information on SB 68
Don Etheridge
Local 71
710 W. 9th St.
Juneau, AK 99801
POSITION STATEMENT: Requested eqaul representation of public
employee representatives on task force
Mike McMullen, Personnel Manager
Division of Personnel
Department of Administration
P.O. Box 110201
Juneau, AK 99811-0201
POSITION STATEMENT: Presented Administration's concerns with SB 68
Jim Baldwin, Assistant Attorney General
Civil Division
Department of Law
P.O. Box 110300
Juneau, AK 99811-0300
POSITION STATEMENT: Outlined department's concerns with SB 68
Ms. Pam LaBolle, President
Alaska State Chamber of Commerce
217 2nd St.
Juneau, AK 99801
POSITION STATEMENT: Testified in support of SB 68
Paul Sweet
P.O. Box 1562
Palmer, AK 99645
POSITION STATEMENT: Had questions on SB 68
ACTION NARRATIVE
TAPE 97-4, SIDE A
Number 001
SJR 14 SUPPORT FEDERAL CONCEALED GUN LEGISLATION
CHAIRMAN GREEN called the Senate State Affairs Committee to order
at 3:34 p.m., and brought up SJR 14 as the first order of business
before the committee.
Number 005
BILL STOLTZE , staff to Senator Rick Halford, who is prime sponsor
of SJR 14, explained the resolution is straightforward with one
resolve supporting a national standard in accordance with which
nonresidents of a state may carry certain concealed firearms.
Because of confusing regulations that vary in the 50 states, it is
problematic for an individual who has a concealed handgun permit in
Alaska to carry that handgun into another state. SJR 14 endorses
H.R. 339, which will allow the carry of a concealed handgun in
another state. The permittee would have to comply with the laws of
the other state, but if that state doesn't have an existing law,
then there are federal regulations providing where the handgun can
or cannot be carried.
Number 064
There being no further testimony or questions on SJR 14, CHAIRMAN
GREEN asked for the pleasure of the committee.
SENATOR MILLER moved SJR 14 and the accompanying fiscal note be
passed out of committee with individual recommendations. Hearing
no objection, it was so ordered.
Number 075
SB 46 NEW FERRY NAMED M.V. KENNICOTT
CHAIRMAN GREEN brought SB 46 before the committee as the next order
of business. Because HB 64, which is the same as SB 46, was passed
by the House, transmitted to the Senate and referred to the State
Affairs Committee, it was agreed the House bill would be scheduled
for a hearing the following week and action would be taken on that
piece of legislation at that time.
SENATOR MACKIE commented he believes it was a very good process
entered into by the leadership of the Legislature and the
Administration to involve children in the school districts around
the state in selecting a name for the new ferry.
Number 125
SB 68 TASK FORCE ON PRIVATIZATION
CHAIRMAN GREEN brought SB 68 before the committee as the final
order of business.
SENATOR WARD , prime sponsor of SB 68, said privatization would save
money for the state of Alaska, but that component is a secondary
component. He said we have a responsibility to the citizens of
Alaska to perform certain tasks, and this has to be weighed into
the privatization question.
Because privatization is such a large task to undertake, it has
been broken down into two separate components. The first component
for the task force to look at this year is the Department of
Health, Education and Social Services, the Department of
Corrections, the Department of Transportation and Public
Facilities, and the second component is state contracting policy
and procedures. He noted the budgets of those departments total
$1.5 billion, so it is a tremendous dollar volume to go through.
Senator Ward related that other states have similar task forces and
they have found areas where they could not only protect the public
interest as the number one goal, but to protect in a reduced manner
through contracting, etc.
Senator Ward said the intent of SB 68 is to look at the entire
privatization question and to approach it from a methodical means
in order to resolve it in an orderly fashion if, in fact, it does
need to have legislation proposed.
Number 185
CRAIG JOHNSON , staff to Senator Ward, discussed other states that
have implemented similar programs. In 1990, the state of Montana
issued a report on the Department of Administration, Department of
Commerce, etc., and the bottom line of that report was that
through privatization and without the reduction of services, they
showed a savings of $1.5 million over a three-year period. In New
Jersey, a task force examined privatization in competitive
contracting and that report showed a $30 million savings in the
first year.
Mr. Johnson said SB 68 has been embraced by several broad and far
reaching groups. He said he thinks the thought is that if a
working document can be developed that will allow the evaluation of
privatization in a fair, open and constructive manner, that
everyone will be the beneficiary of that.
The task force, which will consist of ten members, would be
required to submit its first report by November 15, 1997. A second
report on privatization of government functions not addressed in
the first report would be due November 15, 1998. The task force
would then sunset on December 1, 1998.
Number 230
CHAIRMAN GREEN commented that in examining the different
departments, the task force could have very different conclusions
for each department and recommend one course of action for one
group and then a different course of action for anther group. MR.
JOHNSON agreed, and said that would be the goal, as well as to
examine it in the premise of saving the state money and closing the
fiscal gap.
Number 245
DON ETHERIDGE , representing Local 71 and also speaking on behalf of
the APEA Supervisors Unit, stated they do support the task force
idea, but they want it to be done on a fair and equal footing for
the employees of the unions that are doing the jobs now. That is
why they are requesting that they receive seats on this task force
with the organized labor folks that are already involved with it.
Mr. Etheridge said a lot of their concern comes from some of the
contracting out that has been done in the past where a job is
contracted out, but the people working under that contract have to
do a lot less than is required for public employees doing the same
job for the same dollar figure. He cited an incident where some
people proposed taking over the grading of a road for the same
dollar figure that the state is now doing the entire maintenance of
the road.
In conclusion, Mr. Etheridge said the employees he represents are
confident that the job can't be done for less than what they can do
it for, and they would like to part of this task force process.
Number 280
SENATOR DUNCAN asked if he was correct in his understanding that
Mr. Etheridge testified in support of the task force with the idea
that there be assurance that the public employees' unions are
involved and represented on the task force. MR. ETHERIDGE
acknowledged that was correct, and added they would like one of the
public seats on the Senate side, one of the public seats on the
House side, as well as one of the seats appointed by the governor,
and that this be specified in the bill.
Number 301
MIKE MCMULLEN , Division of Personnel, Department of Administration,
said he was present to explain the current restrictions in the
state collective bargaining agreements that have to do with studies
that would lead to privatization.
Mr. McMullen said several of the state's collective bargaining
agreements identify procedural steps that must be followed if work
of the bargaining unit is going to be contracted out, and, in all
cases, it requires a rather formal study to show the cost benefits
and conclude that there is a savings to the state before that
happens.
A concern of the departments is in terms of the timing. The
legislation requires that the task force produce recommendations,
in November 1997 so that the Legislature can consider them in the
next session. If the task force identifies areas to be studied,
there is a cost to those to studies, and if they wait until next
year to get the money to do the studies, that pushes the
implementation later. This has the potential of the task force
recommendation and the actual study coming up with different
conclusions. Mr. McMullen said the department is leaning towards
the task force actually going to the level of detail of doing the
feasibility studies so that it is done once and the conclusions are
final and from there the state would proceed with the
implementation.
Mr. McMullen advised that it has been the department's experience
that the kind of study required to stand up in arbitration cases
can cost from $20,000 to $50,000. If the task forces recommends 15
areas, then $300,000 or more would be needed to do the formal
studies. Whether the task force does those or the Administration
does those, the money will need to be there and the studies will
need to be done in order to make this succeed.
Mr. McMullen said there is a slight hesitancy in full support of
this process on the part of the Administration in that in looking
at all the options for government to be run correctly, efficiently,
and to provide the services required from our residents, studying
privatization as a single solution is sort of the cart before the
horse type of question.
Mr. McMullen related that when it comes to the Administration
making the appointments, it will be looking at an issue that has
been raised in arbitrations in the past, and that is participating
in a task force type review before a formal feasibility study is
conducted. The decision to contract out was made before the
feasibility study, and therefore, the feasibility study is
questionable and the contracting out in conflict with collective
bargaining agreements.
Mr. McMullen said the Administration's biggest concern, recognizing
that a formal study will be required, is it will need to be funded
and it will need to occur before the contracting occurs, as well as
being sure that it doesn't get in the wrong sequence with
legislation or expectations based on the task force
recommendations, which may end up being different than the detailed
analysis.
SENATOR WARD said a lot of the concerns raised by Mr. McMullen are
the very concerns that the other 41 states have faced, and they
have not all been resolved. He stressed it is not the intent of
this legislation to privatize all of government as a first
priority. The first priority is service to the people and then to
look at privatization to see if it can be done better, and if not,
he would fully expect this task force to leave it alone.
Number 400
SENATOR DUNCAN asked Mr. McMullen if the concern about the sequence
of task force recommendations, possible legislation to accomplish
the recommendations and feasibility studies, could cause difficulty
in arbitration with unions and in resolving some issues. MR.
MCMULLEN acknowledged that it could be a problem.
Number 420
CHAIRMAN GREEN asked if there is a legal description of a
"feasibility study." MR. MCMULLEN advised that there is not, and
he pointed out that contracts aren't even consistent in their
references to feasibility studies.
Number 441
JIM BALDWIN , Assistant Attorney General, Department of Law, said he
had two points he wanted to make about SB 68. The first one is
that the department believes there is a legal issue with placing
administration people on what would be a legislative organization.
The separation of powers doctrine requires that the branches in
their functions be kept basically separate unless there are places
in the constitution where there is some overlapping, and he said he
didn't see a particular provision for that here. He said the
Administration is willing and able to assist in any way it can
short of membership on the task force in order to keep faith with
the separation of powers doctrine.
Mr. Baldwin's second point was the provision relating to subpoenas
and arrests. He said it is very broad grant of power to a
legislative committee beyond that which is currently provided in
statute. He suggested that in the way it is written in the bill,
it may come in conflict with a court rule.
Number 475
CHAIRMAN GREEN related that she discussed the subpoena provision
with the sponsor and that she had an amendment do delete that
provision, but that it might be appropriate to keep in the ability
to swear in a witness.
Number 500
SENATOR MILLER asked if it was the Administration's position that
they don't want a seat on this task force, but that they would
assist the task force in any way they can. MR. BALDWIN responded
that was correct.
Number 540
SENATOR WARD asked if was it his testimony that if this legislation
passes, the Governor, the Administration, who have supported
privatization studies in the past, will not appoint those
positions. MR. BALDWIN replied that he did not know the answer to
that question.
Number 550
PAM LABOLLE , President, Alaska State Chamber of Commerce,
testifying in support of SB 68, stated privatization is one of the
state chamber's priorities and has been for the past two years.
She read from a resolution passed by the chamber which encourages
the privatization of those state services which could be
competitively provided in the private sector. It also asks that
the Legislature forge a plan by the end of 1997 and implement a
program to privatize all applicable services currently provided by
the government.
SENATOR WARD expressed his appreciation to Ms. LaBolle and the
state chamber for all the information they have provided to him on
the issue of privatization.
Number 580
CHAIRMAN GREEN stated there was one individual waiting to testify
via teleconference from the Mat-Su Legislative Information Office.
PAUL SWEET of Palmer questioned if there was a cost analysis as to
what the cost will be for each prisoner by privatizing and how much
money will be saved there.
TAPE 97-4, SIDE B
Number 001
Continuing, Mr. Sweet also questioned what kind of insurance
coverage would be necessary under privatization since the tort
reform bill will eliminate deep pockets. He said the bottom line
is that if there isn't the proper insurance coverage, who pays for
a possible riot or killing in the prison system when there is no
more deep pockets to go to.
SENATOR WARD expressed his appreciation to Mr. Sweet for his
questions and concernss, and assured him that these were the types
of issues that would be looked at by the task force.
Number 040
CHAIRMAN GREEN offered the following amendment to SB 68, which
would delete the subpoena provision:
Amendment No. 1
Beginning at page 2, line 20, through page 3, line 19: Delete
subsections (b), (c) and (d).
Renumber remaining subsection accordingly.
SENATOR MACKIE moved the adoption of Amendment No. 1. Hearing no
objection, the Chairman stated the amendment was adopted.
Number 052
SENATOR MACKIE said he thought it was a good idea to involve a
representative of the public employees on the task force and that
member could be one of the governor's appointees. He then moved
the following amendment:
Amendment No 2
Page 2, line 3: Following "governor" insert ", one of which will
be a member of a public employee's organization."
SENATOR DUNCAN suggested amending the language so that it would
provide that labor organizations that represent state employees
would provide a list of nominees. He also noted that Mr. Etheridge
indicated in his testimony that they are supportive of this issue
on the condition that there be labor representation on the task
force and that they would like to have one of the seats appointed
by each of the presiding officers, as well as one of the governors,
which would give them a total of three seats on the task force.
SENATOR MILLER said he thinks organized labor does have a place at
the table, but he is not sure that the speaker of the house and the
president of the senate should be required to make one of their
selections from organized labor, although they may do so.
SENATOR DUNCAN moved the following amended language to Amendment
No. 2:
Amendment to Amendment No. 2
Page 2, line 3, following "governor": Insert ", one of which shall
be a public member selected from a list of nominees submitted by
labor organizations that represent state employees"
Hearing no objection to the amendment to the amendment or to the
amendment itself, CHAIRMAN GREEN stated Amendment No. 2 as amended
was adopted.
Number 125
There was further discussion by committee members on the makeup of
the task force and whether organized labor should be given more
seats. SENATOR DUNCAN said he had prepared an amendment that would
give organized labor additional seats, but that he would not offer
the amendment in committee.
CHAIRMAN GREEN commented that she doesn't think the major group
impacted by this is the public employees' union; she thinks it is
the other 500,000 plus state citizens who are impacted and who are
very concerned. She added that she does not want this to become a
public employees versus the citizens issue.
Number 240
SENATOR DUNCAN directed attention to the first finding in Section
1 on page 1, which he thinks is misleading, and he said he wants to
be sure that it is not implying that the bureaucracy of state
government is exceeding the annual revenue of the state, because it
is not. A big portion of the state's budget is education,
municipal assistance, revenue sharing, etc.
There being no further testimony or discussion on SB 68, CHAIRMAN
GREEN asked for the pleasure of the committee.
SENATOR WARD moved that CSSB 68(STA) and the accompanying fiscal
note be passed out of committee with individual recommendations.
Hearing no objection, it was so ordered.
There being no further business to come before the committee,
CHAIRMAN GREEN adjourned the meeting at 4:45 p.m.
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