Legislature(2001 - 2002)

04/25/2002 04:30 PM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                    
                 SENATE STATE AFFAIRS COMMITTEE                                                                               
                         April 25, 2002                                                                                         
                            4:30 p.m.                                                                                           
                                                                                                                                
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Gene Therriault, Chair                                                                                                  
Senator Randy Phillips, Vice Chair                                                                                              
Senator Rick Halford                                                                                                            
Senator Ben Stevens                                                                                                             
Senator Bettye Davis                                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All Members Present                                                                                                             
                                                                                                                              
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 289 am                                                                                    
"An Act  relating to  the effective  date of  a municipal  manager                                                              
plan  that has  been  adopted and  to the  effective  date of  the                                                              
repeal  of a municipal  manager plan,  and relating  to a  special                                                              
election for  mayor when  municipal manager  plans are  adopted or                                                              
repealed."                                                                                                                      
     HEARD AND HELD                                                                                                             
                                                                                                                                
CS FOR HOUSE BILL NO. 438(STA)                                                                                                  
"An  Act  relating  to  motor  vehicle   registration  plates  for                                                              
disabled veterans; and providing for an effective date."                                                                        
     MOVED CSHB 438(STA) OUT OF COMMITTEE                                                                                       
                                                                                                                                
HOUSE BILL NO. 444                                                                                                              
"An  Act relating  to buildings  covered under  the Alaska  public                                                              
building fund; and providing for an effective date."                                                                            
     MOVED HB 444 OUT OF COMMITTEE                                                                                              
                                                                                                                                
CS FOR HOUSE BILL NO. 305(STA) am                                                                                               
"An Act prohibiting  certain state employment, a  student loan, or                                                              
a permanent fund  dividend for a person who fails  to register for                                                              
the military  selective  service; and providing  for an  effective                                                              
date."                                                                                                                          
     HEARD AND HELD                                                                                                             
                                                                                                                                
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
HB 289 - See CRA minutes dated 4/10/02.                                                                                         
HB 438 - No previous action to record.                                                                                          
HB 444 - No previous action to record.                                                                                          
HB 305 - No previous action to record.                                                                                          
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
Representative Gary Stevens                                                                                                     
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Sponsor of HB 289.                                                                                       
                                                                                                                                
Jim Pound                                                                                                                       
Aide to Representative Lesil McGuire                                                                                            
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Introduced HB 438.                                                                                       
                                                                                                                                
Representative Jeannette James                                                                                                  
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Sponsor of HB 444.                                                                                       
                                                                                                                                
Chris Parce                                                                                                                     
Director                                                                                                                        
Division of General Services                                                                                                    
Department of Administration                                                                                                    
PO Box 110200                                                                                                                   
Juneau, AK  99811-0200                                                                                                          
POSITION STATEMENT:  Testified on HB 444.                                                                                     
                                                                                                                                
Colleen Shaub                                                                                                                   
Aide to Representative Lisa Murkowski                                                                                           
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Introduced HB 305.                                                                                       
                                                                                                                                
Diane Barrans                                                                                                                   
Executive Director                                                                                                              
Alaska Commission On Postsecondary Education                                                                                    
Department of Education & Early Development                                                                                     
        th                                                                                                                      
801 W 10 St.                                                                                                                    
Juneau, AK  99801-1894                                                                                                          
POSITION STATEMENT:  Testified on HB 305.                                                                                     
                                                                                                                                
Lance Herrington                                                                                                                
No address provided                                                                                                             
POSITION STATEMENT:  Testified on HB 305.                                                                                     
                                                                                                                                
Nanci Jones                                                                                                                     
Director                                                                                                                        
Permanent Fund Dividend Division                                                                                                
Department of Revenue                                                                                                           
PO Box 110400                                                                                                                   
Juneau, AK  99811-0400                                                                                                          
POSITION STATEMENT:  Testified on HB 305.                                                                                     
                                                                                                                                
Charlie Smith                                                                                                                   
No address provided                                                                                                             
POSITION STATEMENT:  Testified on HB 305.                                                                                     
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 02-25, SIDE A                                                                                                            
                                                                                                                                
CHAIRMAN  GENE   THERRIAULT  called   the  Senate  State   Affairs                                                            
Committee meeting  to order  at 4:30 p.m.   Present were  Senators                                                              
Halford,  Phillips and  Chairman Therriault.   Senators Davis  and                                                              
Stevens arrived later.                                                                                                          
                                                                                                                                
The first order of business was HB 289.                                                                                         
                                                                                                                                
                                                                                                                                
                  HB 289-MUNICIPAL MANAGER PLAN                                                                             
                                                                                                                                
REPRESENTATIVE GARY STEVENS, sponsor  of HB 289, said there can be                                                              
confusion when  an election  takes place to  change the form  of a                                                              
municipal government  at the  same time as  an election  is taking                                                              
place for  the mayor's position.   HB 289 attempts to  protect the                                                              
voters'  right to  change  the form  of  government  and give  the                                                              
community some options.   He said the bill would  make it clear to                                                              
the voter  to what position they  are electing the candidate.   It                                                              
would also make  it clear to the candidate what  position they are                                                              
running for.  He said HB 289 would  not take away the right of the                                                              
public to change the form of government.   They can do this at any                                                              
time  by  having  a  special  election  separate  from  a  mayoral                                                              
election.  HB 289  would allow the addition of a  year between the                                                              
change of  government and  the change  of the mayor.   He  said it                                                              
would also  allow a special  election for  the new mayor  when the                                                              
change of government occurred during the current mayor's term.                                                                  
                                                                                                                                
He  said  current  regulations  require   the  assembly  to  enact                                                              
provisions within 60 days of the  adoption of a change in the form                                                              
of government.   Having been through  that process, he  knows that                                                              
two months  is a very  short period of time  to change all  of the                                                              
borough  codes to  comply with  the new  form of  government.   He                                                              
noted  that under  current regulations,  a  candidate running  for                                                              
mayor will not  know until after the election which  type of mayor                                                              
they are going to be.                                                                                                           
                                                                                                                                
REPRESENTATIVE STEVENS  said HB 289  was written with  three major                                                              
objectives in mind; first, to protect  the rights of the voters to                                                              
change the  government;  second, to reduce  confusion amongst  the                                                              
voters  as  to  what  position  they  are  electing  someone;  and                                                              
finally,  to ensure  that a candidate  was aware  of the  position                                                              
they were running for and may be elected to.                                                                                    
                                                                                                                                
SENATOR HALFORD  said often a person  is running for mayor  at the                                                              
same time  that the management  question is on  the ballot.   If a                                                              
person  elected as  mayor  wished to  be a  strong  mayor and  the                                                              
voters had approved that form of  government, the way he reads the                                                              
bill, that strong  mayor form of government would  not take effect                                                              
for one year.   In this situation, the manager  would be protected                                                              
for another year.   He noted that the manager is  often the person                                                              
that people are mad at, especially in a small community.                                                                        
                                                                                                                                
REPRESENTATIVE STEVENS  said HB 289  would give the  community and                                                              
the assembly  the option to take  an additional year to  enact the                                                              
change in form  of government.  It is possible  that the candidate                                                              
wishing  for a  strong mayor  position  would be  elected but  the                                                              
voters  would decide  to stay with  the ceremonial  mayor form  of                                                              
government or vice versa.                                                                                                       
                                                                                                                                
SENATOR HALFORD said it appeared  that this situation could happen                                                              
in either  direction.  A  candidate wishing  to be a  strong mayor                                                              
could have to wait a year to get  the position they wanted or vice                                                              
versa.                                                                                                                          
                                                                                                                                
REPRESENTATIVE  STEVENS  noted there  was also  an  option in  the                                                              
bill.                                                                                                                           
                                                                                                                                
SENATOR HALFORD asked how the option worked.                                                                                    
                                                                                                                                
REPRESENTATIVE  STEVENS noted  the following  language on  page 1,                                                              
lines 7-12:                                                                                                                     
                                                                                                                                
     The  manager plan  takes effect  on the  earlier of  the                                                                   
     following: (1)  the day after  the last day of  the term                                                                   
     of the mayor  in office on the date the  plan is adopted                                                                   
     by the  governing body; or (2)  one year after  the date                                                                   
     the plan is adopted by the governing body.                                                                                 
                                                                                                                                
REPRESENTATIVE  STEVENS said  this language  allows the voters  to                                                              
make the decision to take an additional year to make the change.                                                                
                                                                                                                                
CHAIRMAN THERRIAULT  said after an election, the  current mayor is                                                              
usually only in  office for a couple of weeks  before the swearing                                                              
in of the new  mayor.  He asked if the change  would take place at                                                              
that time.                                                                                                                      
                                                                                                                                
REPRESENTATIVE STEVENS  said state  law requires that  the borough                                                              
codes be  revised to match  the new form  of government  within 60                                                              
days.   This change cannot take  place immediately because  it's a                                                              
lengthy process.                                                                                                                
                                                                                                                                
CHAIRMAN  THERRIAULT   presented  the   following  scenario.     A                                                              
candidate  runs for  mayor  wishing to  be  a strong  mayor.   The                                                              
voters approve  a strong-mayor  form of  government.  The  current                                                              
mayor,  a ceremonial  mayor, is  at the  end of their  term.   The                                                              
change would  take place when  the ceremonial mayor's  term ended.                                                              
This would be a short time after the election.                                                                                  
                                                                                                                                
REPRESENTATIVE STEVENS said that was correct.                                                                                   
                                                                                                                                
CHAIRMAN THERRIAULT  asked if they decided after  the election how                                                              
long was going to be allowed to make the change.                                                                                
                                                                                                                                
SENATOR HALFORD  said the problem  was that it wasn't  clear until                                                              
after the  election which  form of government  was going to  be in                                                              
place.                                                                                                                          
                                                                                                                                
CHAIRMAN THERRIAULT  asked if the  information regarding  the form                                                              
of government  and when  the change  would take  place was  on the                                                              
ballot.                                                                                                                         
                                                                                                                                
REPRESENATIVE STEVENS said it should be.                                                                                        
                                                                                                                                
SENATOR  HALFORD said  the  following scenario  could  happen.   A                                                              
strong mayor is  elected and a strong mayor form  of government is                                                              
approved.   The  assembly would  then have  60 days  to adopt  the                                                              
plan, but the plan  doesn't take effect for one year  or until the                                                              
term  of that  mayor expires.   The  assembly could  call for  the                                                              
ending of the term  of the mayor that was just  elected and have a                                                              
special  election  for   a  new  mayor  under  the   new  form  of                                                              
government.                                                                                                                     
                                                                                                                                
REPRESENTATIVE STEVENS said the term  of office to which the mayor                                                              
had been elected must be respected.                                                                                             
                                                                                                                                
SENATOR HALFORD  quoted the following  language from page  2, line                                                              
11:                                                                                                                             
                                                                                                                                
     Notwithstanding  AS  29.20.230,  a municipality  may  by                                                                   
     ordinance  provide  that,  when  a  manager  plan  takes                                                                   
     effect under  AS 29.20.480(a)(2)  or when a repeal  of a                                                                   
     manager  plan takes  effect under  AS 29.20.520(2),  the                                                                   
     term of office of the incumbent mayor ends.                                                                                
                                                                                                                                
He said this  appeared to end the  term of the mayor,  even if the                                                              
mayor had  just been elected.   Perhaps there is somebody  who can                                                              
explain how this works to the committee.   He is concerned because                                                              
the factions in  some of the small communities  don't change their                                                              
minds all  at once.  There  can be differences of  opinion between                                                              
the assembly  members.   The community can  be divided on  the two                                                              
candidates for mayor and the form of government they want.                                                                      
                                                                                                                                
CHAIRMAN THERRIAULT  said he was thinking of a  different scenario                                                              
in which somebody  running for mayor intending to  be a ceremonial                                                              
mayor  now finds  himself or  herself with  a full  time job.   He                                                              
noted that  an election  for a  change in  the form of  government                                                              
could also happen halfway through the mayor's term of office.                                                                   
                                                                                                                                
REPRESENATIVE STEVENS said this could  happen by special election.                                                              
                                                                                                                                
SENATOR HALFORD  asked if  there was somebody  from the  State who                                                              
could explain this.                                                                                                             
                                                                                                                                
REPRESENTATIVE  STEVENS said  somebody from  the Alaska  Municipal                                                              
League had been there but they had to leave.                                                                                    
                                                                                                                                
There was no further testimony.                                                                                                 
                                                                                                                                
SSHB 289am was held in committee.                                                                                               
                                                                                                                                
The next order of business was HB 438.                                                                                          
                                                                                                                                
                                                                                                                                
             HB 438-DISABLED VETERANS LICENSE PLATES                                                                        
                                                                                                                                
MR. JIM  POUND, Aide to  Representative Lesil McGuire,  sponsor of                                                              
HB  438, said  the Legislature  has  repeatedly honored  veterans.                                                              
The  most noticeable  form  of recognition  has  been the  special                                                              
license  plates that  signify branches  of  service, Purple  Heart                                                              
recipients  and Medal  of Honor  recipients.   However, there  are                                                              
approximately  900 disabled  veterans who  are only recognized  by                                                              
the standard blue-and-gold  Alaska license plate  with the letters                                                              
D-A-V.  He said  HB 438 would change that license  plate to a red,                                                              
white and blue license  plate, an example of which  is in the bill                                                              
packet.   These license  plates would be  available in  two forms,                                                              
one for veterans who are eligible  for special parking and one for                                                              
those who  are not.  All disabled  veterans who meet  the standard                                                              
municipal  tax deduction  requirement of  50% disability  would be                                                              
eligible for  these license  plates.   He said HB  438 has  a zero                                                              
fiscal note because the Division  of Motor Vehicles is running out                                                              
of the blue-and-gold disabled veterans' license plates.                                                                         
                                                                                                                                
SENATOR  HALFORD said  the existing  law, which  also appeared  on                                                              
page 2, lines 14-16 of HB 438, stated,  "or a resident 65 years of                                                              
age or older  who files a written application for  an exemption on                                                              
a form prescribed by the department."   He asked what the basis of                                                              
that exemption is.                                                                                                              
                                                                                                                                
MR. POUND said he did not know.                                                                                                 
                                                                                                                                
There was no further testimony                                                                                                  
                                                                                                                                
SENATOR HALFORD  moved HB  438 from  committee with attached  zero                                                              
fiscal note and individual recommendations.                                                                                     
                                                                                                                                
SENATOR THERRIAULT asked if there were any objections.                                                                          
                                                                                                                                
There  being  no  objection,  HB 438  moved  from  committee  with                                                              
attached fiscal note and individual recommendations.                                                                            
                                                                                                                                
The next order of business was HB 444.                                                                                          
                                                                                                                                
                                                                                                                                
               HB 444-ALASKA PUBLIC BUILDING FUND                                                                           
                                                                                                                                
REPRESENTATIVE  JEANNETTE  JAMES,  sponsor  of HB  444,  said  the                                                              
Alaska  Public Building  Fund (PBF)  was established  a couple  of                                                              
years  ago for  a trial  period.   The  buildings  listed in  that                                                              
legislation were the Alaska Office  Building in Juneau, the Robert                                                              
B. Atwood  Building in  Anchorage, the  Fairbanks Regional  Office                                                              
Building, the Juneau Community Building,  the Juneau Public Safety                                                              
Building  and  the State  Office  Building  in  Juneau.   The  PBF                                                              
establishes  a  methodology  for  charging  rent  to  the  various                                                              
agencies and/or  other outside interests  that use space  in these                                                              
buildings including an amount for  depreciation.  After paying for                                                              
heat,  light and  other minor  maintenance  items, the  additional                                                              
money from  the fund  could be  used to  keep up the  maintenance.                                                              
She noted that  the State has a deferred maintenance  lag, meaning                                                              
that virtually no major maintenance  was being done.  She said the                                                              
fund  gives the  State a  little more  money to  keep things  from                                                              
running down over a period of time.   She noted that this two-year                                                              
trial period has  been successful.  HB 444 would  allow all of the                                                              
buildings  that  have  been transferred  from  the  Department  of                                                              
Transportation (DOT) to the Department  of Administration (DOA) to                                                              
be "covered  buildings."   HB  444 would  also keep  the PBF  as a                                                              
permanent program.   The State would be able to  move forward with                                                              
the fund  and allow the same  process on other buildings  that may                                                              
be transferred to DOA.                                                                                                          
                                                                                                                                
SENATOR HALFORD  asked if  HB 444 only  applied to buildings  that                                                              
have come from DOT to DOA.                                                                                                      
                                                                                                                                
REPRESENTATIVE JAMES said yes.                                                                                                  
                                                                                                                                
SENATOR HALFORD noted that the fiscal  note said HB 444 allows for                                                              
the  expansion  of  the  PBF  approach.   The  way  he  reads  the                                                              
definition,  he is  concerned  that  HB 444  may  mandate the  PBF                                                              
approach.    He   wanted  to  make  sure  that   the  process  was                                                              
permissive.                                                                                                                     
                                                                                                                                
REPRESNTATIVE  JAMES  said DOA  went  through another  process  to                                                              
reach the decision.                                                                                                             
                                                                                                                                
RECESS UNTIL 4:55 P.M.                                                                                                        
                                                                                                                                
CHAIRMAN  THERRIAULT called  the  Senate State  Affairs  Committee                                                              
back to  order.  He  asked if  Representative James had  concluded                                                              
with her comments.                                                                                                              
                                                                                                                                
REPRESENTATIVE JAMES said she had.                                                                                              
                                                                                                                                
CHAIRMAN  THERRIAULT  asked  if  somebody  from  the  State  could                                                              
explain how  the PBF worked and how  the money came into  and went                                                              
out of the fund.                                                                                                                
                                                                                                                                
CHRIS  PARCE,  Director  of  the  Division  of  General  Services,                                                              
Department  of  Administration, said  one  of  her duties  was  to                                                              
manage the PBF.   She said DOA determines the cost  of running the                                                              
buildings  including the  depreciation of  the facilities.   Those                                                              
costs are spread over the total rentable  square feet and the rent                                                              
is collected  from the tenants.   Those funds are used  to pay for                                                              
utility  bills, general  janitorial  services and  other items  of                                                              
that nature.  She noted that one  of the main goals of the PBF was                                                              
to be able to collect the depreciation  dollars and be able to use                                                              
them on  major maintenance  projects.   She pointed  out that  the                                                              
Alaska Office Building  was being roofed at the moment.   She said                                                              
the PBF was working marvelously.                                                                                                
                                                                                                                                
CHAIRMAN THERRIAULT asked how much money was earned.                                                                            
                                                                                                                                
MS. PARCE said the eight buildings  brought in about $6-7 million.                                                              
                                                                                                                                
CHAIRMAN  THERRIAULT  asked  if  that  showed up  in  the  capital                                                              
budget.                                                                                                                         
                                                                                                                                
MS. PARCE  said the money  comes into  the operating budget.   The                                                              
PBF is  a sub-fund of  the general fund  and is a  dedicated fund.                                                              
DOA  pays the  bills  out  of the  PBF  and  takes care  of  major                                                              
projects as they can afford to.                                                                                                 
                                                                                                                                
5:00 p.m.                                                                                                                       
                                                                                                                                
CHAIRMAN  THERRIAULT  asked  how  DOA got  authorization  for  the                                                              
expenditures.                                                                                                                   
                                                                                                                                
MS. PARCE said  the Legislature approved the  expenditures through                                                              
the operating  budget in the first two  years of the PBF.   In the                                                              
budget that is before the Legislature  now, she has requested that                                                              
the depreciation dollars  be called CIP funds so  they can be used                                                              
throughout the  construction season.  She said  major construction                                                              
projects don't  get started  until April  or May.   If she  had to                                                              
                                   th                                                                                           
stop  these  projects  on  June  30,   the  money  can't  be  used                                                              
effectively.   The  depreciation  purposes of  the  PBF have  been                                                              
moved to be able to roll over the year.                                                                                         
                                                                                                                                
SENATOR HALFORD asked how many more  buildings or how much more in                                                              
value HB 444 would add to the PBF.                                                                                              
                                                                                                                                
MS. PARCE  said HB 444  wouldn't add any  more buildings.   HB 444                                                              
would allow more  buildings to be added if they  became attractive                                                              
to the PBF.   She noted that one  of the main missions  of the PBF                                                              
is to  replace general  fund dollars with  other kinds  of revenue                                                              
streams.  In order  for a facility to be attractive  for PBF uses,                                                              
it would need to bring in new money  for the State.  If a building                                                              
were housed totally  by the general fund, it wouldn't  be quite as                                                              
attractive because it wouldn't bring in new money.                                                                              
                                                                                                                                
SENATOR HALFORD said he thought it would lose money.                                                                            
                                                                                                                                
MS. PARCE agreed.                                                                                                               
                                                                                                                                
SENATOR HALFORD said  it would have an operating  budget impact if                                                              
there  was  the  cost  of  operation  that  was  normally  in  the                                                              
operating budget  plus the  reserve for  maintenance.   That would                                                              
cost more than it would otherwise.                                                                                              
                                                                                                                                
MS. PARCE said DOA wouldn't just take all of the buildings.                                                                     
                                                                                                                                
SENATOR HALFORD said saving reserves  for maintenance might not be                                                              
a bad idea.                                                                                                                     
                                                                                                                                
MS. PARCE  said DOA looked  at the makeup  in the tenants  of each                                                              
building.                                                                                                                       
                                                                                                                                
REPRESENTATIVE JAMES said originally,  Retirement and Benefits had                                                              
not been paying rent.  She said that  was collected in a different                                                              
fund.    The State  also  cannot  collect  rent from  the  federal                                                              
agencies  in the  facilities unless  all  of the  agencies in  the                                                              
building  are charged  rent.   She said  when DOA  was making  its                                                              
decisions, those  federal agencies needed  to be included  to make                                                              
it a benefit  financially.  She said the kinds  of maintenance the                                                              
PBF was  able to  achieve wouldn't  get done  otherwise without  a                                                              
special appropriation.                                                                                                          
                                                                                                                                
CHAIRMAN THERRIAULT  asked if the  federal agencies housed  in the                                                              
state buildings had been paying rent.                                                                                           
                                                                                                                                
MS.  PARCE said  they  had  not.   Their  costs had  been  covered                                                              
through the  regular operating  budget of DOT.   DOT  was managing                                                              
these buildings  and would  put forth  a proposal  to pay  for the                                                              
bills of  the buildings.   She  said she  supposed DOT could  have                                                              
asked  for funds  for  depreciating items.    However, she  didn't                                                              
think that they had done so because  there is a great deal of work                                                              
that never got done.                                                                                                            
                                                                                                                                
There was no further testimony.                                                                                                 
                                                                                                                                
SENATOR  DAVIS moved  HB  444 from  committee  with attached  zero                                                              
fiscal note and individual recommendations.                                                                                     
                                                                                                                                
There  being  no  objection,  HB 444  moved  from  committee  with                                                              
attached fiscal note and individual recommendations.                                                                            
                                                                                                                                
The final order of business was HB 305.                                                                                         
                                                                                                                                
                                                                                                                                
           HB 305-NONCOMPLIANCE WITH SELECTIVE SERVICE                                                                      
                                                                                                                                
COLLEEN SHAUB,  Aide to Representative Lisa Murkowski,  sponsor of                                                              
HB 305, said the intent of this legislation  is to ensure that all                                                              
Alaskans   are   knowledgeable   about   the   Selective   Service                                                              
registration system and would register  promptly.  She said HB 305                                                              
would require any  U.S. male citizen between the  ages of 18-26 to                                                              
comply  with   the  federal  Selective  Service   registration  if                                                              
applicable to be eligible for certain  state employment, an Alaska                                                              
Student  Loan (ASL)  or the Permanent  Fund Dividend  (PFD).   She                                                              
said at least  28 other states had implemented  similar conditions                                                              
for eligibility for certain programs  and state benefits.  Federal                                                              
law  already  requires  registration with  the  Selective  Service                                                              
within 30 days of turning 18.  At  the federal level, a person who                                                              
does not  register will be  denied certain federal  employment and                                                              
aid.   She said  HB 305  brings those  aspects down  to the  state                                                              
level and  adds the provision  on the PFD.   She said  the sponsor                                                              
would like the committee to adopt the following amendment:                                                                      
                                                                                                                                
Page 4, following line 8:                                                                                                       
     Insert a new bill section to read:                                                                                         
   "* Sec. 3.  AS 14.43.172(c) is amended to read:                                                                          
          (c)  In addition to the provisions of (a) of this                                                                     
     section,   a  borrower   is   eligible  for   a  loan   under                                                              
     AS 14.43.170 - 14.43.175 if the borrower                                                                                   
               (1)   is not  delinquent on and  has never  been in                                                              
     default on a loan previously awarded by the commission;                                                                    
               (2)     at   the  time  of   application   or  loan                                                              
     disbursement  does   not  have  a  past  due   child  support                                                              
     obligation  established  by  court  order  or  by  the  child                                                              
     support enforcement division  under AS 25.27.160 - 25.27.220;                                                              
               (3)   has not, within the previous  five years, had                                                              
     a loan  discharged or written  off by the commission  for any                                                              
     reason;                                                                                                                    
               (4)    does  not have  a  status,  at the  time  of                                                              
     application for  a loan or  disbursement of loan  money, that                                                              
     would  prevent the  borrower  from repaying  the  loan as  it                                                              
     becomes due;                                                                                                               
               (5)    has  not  within  the  previous  five  years                                                              
     defaulted on another  loan made to the borrower  by a lending                                                              
     entity  unless the borrower  can show  good faith  efforts to                                                              
     repay the  loan and extraordinary  circumstances that  led to                                                              
     the default; [AND]                                                                                                         
               (6)   does not have  a credit history, at  the time                                                              
     of  application   for  a  loan,  that   demonstrates  chronic                                                              
     inability or  unwillingness to pay an extension  of credit or                                                              
     loan as it becomes due; and                                                                                            
               (7)    has  complied with  the  military  selective                                                          
     service  registration  requirements  imposed under  50  U.S.C                                                          
     App.  453   (Military  Selective   Service  Act),   if  those                                                          
     requirements  were applicable  to the  person, or the  person                                                          
     has come into compliance within  30 days of being notified of                                                          
     the person's lack of compliance."                                                                                      
                                                                                                                                
Renumber the following bill sections accordingly.                                                                               
                                                                                                                                
Page 6, line 12:                                                                                                                
     Delete "a student"                                                                                                         
Insert "an education loan, supplemental education loan,"                                                                        
                                                                                                                                
                                                                                                                                
SENATOR PHILLIPS asked where the sponsor was.                                                                                   
                                                                                                                                
MS.  SHAUB  said  Representative   Murkowski  was  in  the  fiscal                                                              
discussion meeting.                                                                                                             
                                                                                                                                
CHAIRMAN THERRIAULT  asked if she  had concluded her remarks.   He                                                              
also asked if  there was any obligation under federal  law for the                                                              
State to try  and compel Selective Service registration.   He said                                                              
usually when  a short title  was put in, it  was a section  of the                                                              
statutes.    But   the  language  in  HB  305   appears  scattered                                                              
throughout the  statutes and it  has a title.   He asked  why this                                                              
was done.                                                                                                                       
                                                                                                                                
MS.  SHAUB  said  the  sponsor  wanted  the  title  to  seem  less                                                              
abrasive.                                                                                                                       
                                                                                                                                
CHAIRMAN  THERRIAULT said  the title  would be  in the  uncodified                                                              
section of  the statutes whereas  the operative language  would be                                                              
spread throughout  the statutes.   He  used the  example of  a new                                                              
crime being added to the statutes  where the title would appear in                                                              
the regular statute  along with the new crime language.   He noted                                                              
that with  HB 305,  they wouldn't even  be in  the same book.   He                                                              
said this seemed strange to him.                                                                                                
                                                                                                                                
DIANE BARRANS, Director of the Alaska  Commission on Postsecondary                                                              
Education (ACPE),  said HB 305 did  not reference the  new student                                                              
loan programs  that would  go into effect  July 2002 but  were not                                                              
yet in statute.   The amendment in the bill  packet references the                                                              
new  AS  14.43.172  that  contains  the  new  Alaska  Supplemental                                                              
Education  Loan Program.   The requirement  for Selective  Service                                                              
registration  would be  added to  the requirements  for the  loan.                                                              
The amendment ensures that the changes  the sponsor wanted to make                                                              
to the ASL program were carried through to the new loan as well.                                                                
                                                                                                                                
CHAIRMAN  THERRIAULT asked  how someone  would prove  that he  had                                                              
complied with Selective  Service registration when  he applied for                                                              
the ASL.                                                                                                                        
                                                                                                                                
MS. BARRANS  said ACPE  proposed to verify  registration in  a way                                                              
that would cause  no additional cost to ACPE.   ACPE would require                                                              
prospective  borrowers  to  fill  out  the  Free  Application  for                                                              
Federal Student  Aid, which  they would  need to  do anyway  to be                                                              
eligible for the  new Alaska Supplemental Loan Program.   The U.S.                                                              
Department of Education would then  send the application through a                                                              
data review,  performing matches against the  Immigration Service,                                                              
the  Selective Service,  the Internal  Revenue  Service and  other                                                              
such agencies, to ensure that the  borrower was eligible for their                                                              
loan.   ACPE would  take eligibility  for the  federal loan  as an                                                              
assurance   that   the   borrower  met   the   Selective   Service                                                              
requirement.                                                                                                                    
                                                                                                                                
CHAIRMAN THERRIAULT  asked if  the borrower  would be required  to                                                              
fill out this form every year.                                                                                                  
                                                                                                                                
MS. BARRANS  said the borrower  would have  to fill out  a renewal                                                              
form that would  have the data from the prior year  and they would                                                              
simply have to update changes to that information.                                                                              
                                                                                                                                
CHAIRMAN THERRIAULT  pointed out the  exemptions listed in  Sec. 4                                                              
of HB 305 and asked why these employees would be exempt.                                                                        
                                                                                                                                
MS. SHAUB  said she believed  these employees were  already exempt                                                              
under federal law.                                                                                                              
                                                                                                                                
CHAIRMAN THERRIAULT  said a legislator could take  college courses                                                              
and get a student loan.  He asked why they would be exempt.                                                                     
                                                                                                                                
MS. BARRANS  said Sec. 4  makes it a  requirement to  register for                                                              
Selective Service in order to be  employed in certain job classes.                                                              
                                                                                                                                
SENATOR STEVENS  said it was federal  law that being elected  to a                                                              
position, exempted a  person from a lot of requirements.   He said                                                              
that if a  person had been convicted  of a felony, they  would not                                                              
be eligible  to be hired  for or  appointed to certain  positions.                                                              
However, they could be elected to that position.                                                                                
                                                                                                                                
SENATOR HALFORD  pointed out that  the mayor of  Washington, D.C.,                                                              
Marion Berry, had been convicted of cocaine possession.                                                                         
                                                                                                                                
LANCE HERRINGTON  said he was on  the teleconference in  the event                                                              
that Charlie Smith was not available.                                                                                           
                                                                                                                                
SENATOR PHILLIPS said  the question of Selective  Service had been                                                              
on his questionnaire and he received  a lot of comments asking why                                                              
females weren't  required to register  for Selective Service.   He                                                              
said he knew that  this was federal law but wondered  if there was                                                              
a push to include females.                                                                                                      
                                                                                                                                
MR. HERRINGTON said  he was not employed by the  Selective Service                                                              
so he  didn't know what  they were or were  not doing.   He didn't                                                              
believe that they  were under any pressure to  register females at                                                              
this time.                                                                                                                      
                                                                                                                                
NANCI JONES,  Director  of the Permanent  Fund Dividend  Division,                                                              
noted the  language on  page 6, lines  2-8, "come into  compliance                                                              
within 30  days of being  notified of  their lack of  compliance."                                                              
This would  establish a  different time  frame for PFD  applicants                                                              
who  didn't  comply with  Selective  Service  registration  versus                                                              
everybody else that  applied for the PFD.  She said  this would be                                                              
difficult to  administer.  She noted  the Division already  had an                                                              
agreement with  the Selective  Service.   The Division  would send                                                              
Selective Service a  tape of people who would be  eligible for the                                                              
requirement and  the Selective Service  would send that  tape back                                                              
with a  list of  people who  had registered.   The Division  would                                                              
match the tape against a list of  PFD applicants.  If a person had                                                              
not  registered for  Selective Service,  the  Division would  send                                                              
them  a  notice.   That  notice  would  be  the same  notice  that                                                              
everybody  else   who  has  an  incomplete   application  receives                                                              
establishing  a time frame  to get  additional information  to the                                                              
Division.   The  applicant  would  have until  the  given date  to                                                              
register with Selective  Service.  The Division  would get another                                                              
tape  from Selective  Service  to verify  that  the applicant  had                                                              
registered.                                                                                                                     
                                                                                                                                
CHAIRMAN THERRIAULT asked if the  applicant could send a photocopy                                                              
of their registration  or if they had to wait  for the information                                                              
to get in the system.                                                                                                           
                                                                                                                                
MS. JONES  said the applicant  would have to  wait.  In  the first                                                              
     year  of  the Selective  Service  requirement,  the  Division                                                              
     would  ask  Selective  Service  to  send  two  tapes  at  two                                                              
     different times  of the year.   The effective date  of HB 305                                                              
     is  January  1,  2004,  so   the  first  tape  would  include                                                              
     everybody  who had  registered  with  Selective Service  from                                                              
     January  1 through  December 31,  2003.   She said that  tape                                                              
     would be matched  against the applications for  the 2004 PFD.                                                              
     A notice  would be  sent to the  applicants that were  out of                                                              
     compliance   saying  that  they   needed  to  register   with                                                              
     Selective Service  before October 31.  Another  tape would be                                                              
     received  from Selective  Service,  which would  be run  just                                                              
     before  payment,  probably  in  August.    She  said  if  the                                                              
     applicant  was not on  that tape, then  they would  be denied                                                              
     their PFD  along with everybody  else who did not  respond to                                                              
     the Division's  correspondence.   For the second  year, 2005,                                                              
     the Division  would already have  the tape from August.   The                                                              
     Division would  receive a tape each  year in August.   She is                                                              
     concerned that the 30-day provision  would give the applicant                                                              
     a false  sense that  something could  get turned around  that                                                              
     quickly.    The  applicant  has ten  months  to  comply  with                                                              
     whatever  they are lacking  on their  application.   She said                                                              
     there is always the opportunity  to appeal a denial or extend                                                              
     the length of  time you have to comply with  a request if you                                                              
     work with the Division.                                                                                                    
                                                                                                                                
SENATOR HALFORD asked if the Selective  Service tape could include                                                              
location.                                                                                                                       
                                                                                                                                
MS.  JONES  said  the  Division  wouldn't  necessarily  need  that                                                              
information.   They would only be  interested in whether  a person                                                              
had registered or not.                                                                                                          
                                                                                                                                
SENATOR  HALFORD  said  that  could   be  an  important  residency                                                              
crosscheck.   He said  sometimes people  register where  they are,                                                              
not where they came  from.  He noted that during  the Vietnam War,                                                              
people would  register in more  populated areas because  they felt                                                              
the draft board wouldn't get further down the numbers.                                                                          
                                                                                                                                
MS. JONES said at some point the  Division could use the Selective                                                              
Service  for residency  but she guessed  that  if a person  didn't                                                              
register with an Alaska address, they wouldn't be on the tape.                                                                  
                                                                                                                                
SENATOR HALFORD  said you  registered for  Selective Service  in a                                                              
certain  geographical location.   He  thought it  would be  a good                                                              
idea to  put that  into the  Division's database.   When  somebody                                                              
registers  in  a  location  that's   not  in  Alaska,  there's  an                                                              
indication  that they  ought to  be checked  for residency  unless                                                              
they're  in  active  duty  by  the  time  the  Division  gets  the                                                              
application.                                                                                                                    
                                                                                                                                
CHAIRMAN THERRIAULT  asked how  the Division  would catch  up with                                                              
somebody  who lived  in Florida  and  moved to  Alaska after  they                                                              
turned 18.  He  asked if the Selective Service was  going to run a                                                              
tape against the entire nation.                                                                                                 
                                                                                                                                
MS. JONES  said Selective  Service would just  run a tape  for the                                                              
people who are registered in Alaska.                                                                                            
                                                                                                                                
CHAIRMAN THERRIAULT  asked about someone  who lived in  Alaska but                                                              
registered in Florida when they turned 18.                                                                                      
                                                                                                                                
MS.  JONES said  that would  be up  to  the applicant.   When  the                                                              
Division sends  them a  letter saying  they're not in  compliance,                                                              
they  would give  the  Division that  information.   The  Division                                                              
would then verify those few with  Selective Service.  She said the                                                              
men between 18 and 25 would be matched  against the tape Selective                                                              
Service gives  the Division, so if  an applicant is  between those                                                              
ages and  is not on the  tape, they would  receive a letter.   She                                                              
noted that if  any of the identifying information  was wrong, such                                                              
as the  Social Security Number, the  Division wouldn't be  able to                                                              
make  a match  and they  would receive  a letter.   The  applicant                                                              
could then say  that they had registered and provide  the Division                                                              
with proof.                                                                                                                     
                                                                                                                                
SENATOR HALFORD  said if  the Division was  only going to  get the                                                              
match from  Alaska, the system  would do what  he wanted it  to do                                                              
because the applicant  who didn't register in  Alaska wouldn't get                                                              
a match  and the Division  would ask them  to prove that  they had                                                              
registered for  the Selective Service.   The applicant  would then                                                              
say that they  had registered somewhere else.  He  said that would                                                              
at least  raise a flag  that that person  ought to be  checked for                                                              
residency.    He  would like  it  to  be  one more  piece  of  the                                                              
residency package that is in the system.                                                                                        
                                                                                                                                
MS. SHAUB  noted the  requirement also  wouldn't apply  to someone                                                              
who wasn't in  the 18-26 age range.  Those applicants  would still                                                              
get their PFD.                                                                                                                  
                                                                                                                                
SENATOR  HALFORD  agreed  that  it  only  applied  when  you  were                                                              
required to register with Selective Service.                                                                                    
                                                                                                                                
MS.  SHAUB  said  once  someone  turned  26,  if  they  had  never                                                              
registered with  the Selective Service,  they would still  be able                                                              
to get their PFD.                                                                                                               
                                                                                                                                
SENATOR  DAVIS moved  Amendment #1  adding  the Selective  Service                                                              
requirement to the new student loan program.                                                                                    
                                                                                                                                
The being no objection, Amendment #1 was adopted.                                                                               
                                                                                                                                
CHARLIE SMITH, State Director of  the Selective Service in Alaska,                                                              
said  his   position  was   an  uncompensated  volunteer   federal                                                              
position.   He has been in the  position for about six  years.  He                                                              
said he was available to answer any  questions the committee might                                                              
have specific to the Selective Service.                                                                                         
                                                                                                                                
TAPE 02-25, SIDE B                                                                                                            
                                                                                                                                
5:30 p.m.                                                                                                                       
                                                                                                                                
CHAIRMAN THERRIAULT asked if the  Permanent Fund Dividend Division                                                              
would be  sending information to Mr.  Smith to try to  contact the                                                              
individuals who didn't register with Selective Service.                                                                         
                                                                                                                                
MR. SMITH  said that would be  done through the  national computer                                                              
center.   He said he is mainly  involved with selecting  people to                                                              
be on the draft board.  He said there  still is a draft board even                                                              
though there  hasn't been a  draft since 1973.   He also  has five                                                              
National  Guard Reserve  Forces Officers  assigned to  him.   They                                                              
have offices in  Juneau, Anchorage, Nome and Fairbanks  and if the                                                              
draft ever gets  reactivated, those offices would  be reactivated.                                                              
He  said  Alaska  has  almost  a  90%  compliance  rate  with  the                                                              
Selective Service.  He said not too  many people objected to being                                                              
on the  list.  He  noted that it  was just a  list.  If  the draft                                                              
should come in,  there would be other protections.   The President                                                              
and the  Congress would  have to  declare a draft.   He  has found                                                              
that the  majority of people  that do  not register are  not aware                                                              
that there's  a requirement  to register.   He said they've  tried                                                              
newspapers.   He said he  has a person  working with him  in every                                                              
high school  in Alaska,  usually a counselor,  to help  by letting                                                              
the young  men know that there's  a requirement.   However, 10-15%                                                              
of these people still slip through the cracks.                                                                                  
                                                                                                                                
He  said  other  states  have  done   this  through  the  drivers'                                                              
licensing system.  If a person doesn't  register for the Selective                                                              
Service,  they wouldn't  be able  to receive  a drivers'  license.                                                              
From  his  work  as  a  deputy  director  and  director  of  motor                                                              
vehicles, he  knows that there are  a lot of people who  don't get                                                              
drivers' licenses.   He hopes HB 305 would be a  better vehicle to                                                              
promote registration.                                                                                                           
                                                                                                                                
SENATOR PHILLIPS asked  Mr. Smith to refresh his  memory as to why                                                              
females weren't included in the draft.                                                                                          
                                                                                                                                
MR. SMITH  said it was  federal law.  He  said about 10  years ago                                                              
there was  an ERA movement  to get females  included, but  it died                                                              
off.                                                                                                                            
                                                                                                                                
SENATOR  PHILLIPS   said  he  had   a  lot  of  comments   on  his                                                              
questionnaire  that   this  was  not  fair.    He   even  had  one                                                              
constituent send  him a letter  requesting Stevens,  Murkowski and                                                              
Young  to introduce  legislation  to  get  females included.    He                                                              
followed through on that.  He thinks they out to be included.                                                                   
                                                                                                                                
MR. SMITH  said  his job is  to get  things that  comply with  the                                                              
current federal law going.                                                                                                      
                                                                                                                                
SENATOR PHILLIPS asked  if we were making a request  of Murkowski,                                                              
Young and Stevens to draft women.                                                                                               
                                                                                                                                
MR. SMITH said he hadn't thought about it.                                                                                      
                                                                                                                                
CHAIRMAN THERRIAULT  asked if  Representative Lisa Murkowski,  the                                                              
sponsor,  would have a  problem with  deleting Sec.  1 of  HB 305,                                                              
which  was the  title.   He said  titles usually  appear with  the                                                              
language in the statute and this  title would be in the uncodified                                                              
law with no language to accompany  it.  He doesn't see the need to                                                              
have the  title in the uncodified  law when there's  nothing there                                                              
with it.   He asked if other  members of the committee  shared his                                                              
concern.                                                                                                                        
                                                                                                                                
SENATOR PHILLIPS moved Amendment #2.                                                                                            
                                                                                                                                
CHAIRMAN THERRIAULT clarified that  Amendment #2 would delete Sec.                                                              
1.                                                                                                                              
                                                                                                                                
There being no objection Amendment #2 was adopted.                                                                              
                                                                                                                                
CHAIRMAN  THERRIAULT  said  he  thought  he  understood  what  the                                                              
sponsor  was  trying  to  do  in giving  the  readers  of  HB  305                                                              
something to look at other than the  legislative title.  But since                                                              
this was  close to being  put in law, he  didn't see the  need for                                                              
it.                                                                                                                             
                                                                                                                                
MS. BARRANS referenced the language  in HB 305 on page 4, lines 7-                                                              
8 and  in Amendment  #1 on  page 2,  lines 1-2,  stating, "or  the                                                              
person has come  into compliance within 30 days  of being notified                                                              
of  the  person's  lack  of compliance."    She  said  this  would                                                              
actually reduce a  person's opportunity to receive  a student loan                                                              
and be considered  eligible.  She  said if an applicant  is denied                                                              
they can  reapply at any time  during school enrollment.   She was                                                              
concerned that  this language seems  to limit that  opportunity to                                                              
the 30 days following  the denial.  She requests  that language be                                                              
struck from both the bill and the  amendment.  She also noted that                                                              
the effective  date had  been changed from  a prior version  of HB                                                              
305  to January  1,  2004.   With respect  to  the education  loan                                                              
sections, HB  305 would come into  effect in the middle  of a loan                                                              
year.   She said this  would be a  problem because  some borrowers                                                              
would have  been approved without  the requirement earlier  in the                                                              
loan year and others would be required  to register with Selective                                                              
Service during the second half of the same loan period.                                                                         
                                                                                                                                
CHAIRMAN THERRIAULT  asked if there was a problem  with the 30-day                                                              
provision  to   come  into   compliance  with  Selective   Service                                                              
registration.                                                                                                                   
                                                                                                                                
MS. SHAUB said  she believed this was amended on  the House floor.                                                              
She believed the  Representatives had not realized  that you could                                                              
reapply or appeal with both the PFD  and the ASL.  She believes it                                                              
would be fine to remove that language.                                                                                          
                                                                                                                                
CHAIRMAN  THERRIAULT  asked  if  they  just  added  that  specific                                                              
language.                                                                                                                       
                                                                                                                                
MS. SHAUB said they had.  She said  it was done so that if someone                                                              
didn't realize  that they had  to register with  Selective Service                                                              
when they filled out their application  and be denied as a result,                                                              
they weren't unduly punished.  She  said they could always go back                                                              
and reapply or appeal for the PFD or the ASL.                                                                                   
                                                                                                                                
CHAIRMAN THERRIAULT  said he'd like to work with  the drafters and                                                              
Representative Murkowski  to make  sure that in incorporating  the                                                              
amendments and  dropping the 30-day  provision they  didn't create                                                              
other  problems.   He said  the bill  would come  back before  the                                                              
committee for final action.                                                                                                     
                                                                                                                                
HB 305 was held in committee.                                                                                                   
                                                                                                                                
ADJOURNMENT                                                                                                                     
                                                                                                                                
There being no  further business before the committee,  the Senate                                                              
State Affairs Committee meeting was adjourned at 5:40 p.m.                                                                      
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects