Other Committee Business 11:22:58 AM [Contains discussion of HB 30.] CHAIR FAIRCLOUGH announced that the committee would now discuss the consideration of the Performance Review Contract. She reminded the committee that she had previously appointed a subcommittee consisting of herself, Senator Bishop and Representatives Hawker, Herron, and Kawasaki to work on the scope of work for the contract. The subcommittee held a lengthy meeting on October 1, 2013, to discuss the scope of work for the contract; Representatives Olson and Josephson were also in attendance at the subcommittee meeting. Chair Fairclough opined that the subcommittee settled on a thorough and balanced work product, which Ms. Curtis will explain. 11:23:35 AM KRISTIN CURTIS, Legislative Auditor, Division of Legislative Audit, Alaska State Legislature, explained the division intends to request approval to solicit and award a contract not to exceed $300,000 to conduct the Department of Corrections performance review. The contractor will lead the performance review team, which will also be made up of Division of Legislative Audit employees. She reminded the committee that performance reviews of state departments were authorized this past session and will begin with the Department of Corrections. During the course of the review, the department will be required to provide a list of programs or elements of programs supported by general funds that can be cut without impacting the ability of the department to fulfill its mission or reduce required services to the public. A review team lead by a contractor will conduct a systematic assessment of the appropriateness, effectiveness, and efficiency of the department and its programs. The review, she related, is meant to provide information that can improve the entity's performance and assist legislators in evaluating the department and its budget. One of the first steps in the performance review process is the Legislative Budget and Audit Committee's consideration and approval of the performance review scope. She explained that a scope describes the nature and expense of the work that needs to be done in order to complete the review. The scope this committee approves will serve as the basis for the request for proposal for the contractor. Once the contractor completes the review a report is prepared and submitted to the Division of Legislative Audit and then the Legislative Budget and Audit Committee. The Department of Corrections' performance review report must be sent to this committee by December 16, 2014, and is required to be confidential until finalized and released by the committee. Statutes require that copies of the report be sent to the chairs and co-chairs of the House and Senate Finance Committees one week prior to the legislative session beginning. 11:25:49 AM REPRESENTATIVE HAWKER moved that the committee approve the performance review scope of work as presented. There being no objection, it was approved. 11:26:11 AM REPRESENTATIVE HAWKER moved that the committee authorize the legislative auditor to solicit and award a contract for performance review services in an amount not to exceed $300,000. There being no objection, it was so ordered. 11:26:31 AM CHAIR FAIRCLOUGH announced that the committee would now consider the revised committee handbook procedure. 11:26:36 AM MS. CURTIS informed the committee that the changes in the committee handbook were necessitated by the performance reviews of HB 30. The new statutes created by HB 30 were inserted in the committee handbook. The revised committee handbook also includes revised procedures, which were modeled after the audit procedures. The bulk of the new procedures begin on page 41 of the committee handbook. 11:29:22 AM CHAIR FAIRCLOUGH mentioned her appreciation of the proactive approach the division has taken in terms of revising the committee handbook. 11:29:44 AM SENATOR OLSON asked from where the bulk of these changes come. MS. CURTIS explained that she contracted with the previous legislative auditor to draft the changes, which originate from HB 30. The new procedures were modeled in terms of how the audits work, which she recalled was the intent of HB 30. Therefore, there are specifications relating to the release of the audit, the number of days in which the agency can respond, the number of times it comes before the committee, and the confidentiality of the work papers. 11:30:36 AM SENATOR MEYER said he had no concerns with Ms. Curtis' recommendations. However, he mentioned the backlog of the Division of Legislative Audit and inquired as to the current size of it. MS. CURTIS answered that the division's current backlog consists of three special audits and four sunset audits coming next year. SENATOR MEYER then inquired as to how long it would take a newly requested audit to be completed. MS. CURTIS opined that no new audits would be considered next year but rather they would be considered the year after. CHAIR FAIRCLOUGH related her understanding that completion dates would be a full year out. 11:33:02 AM REPRESENTATIVE HAWKER moved that the updated and revised Legislative Budget and Audit Committee handbook as provided to the committee today be adopted as the currently effective committee handbook. There being no objection, the updated and revised Legislative Budget and Audit Committee handbook was adopted. 11:33:34 AM CHAIR FAIRCLOUGH announced the appointment of a subcommittee on occupational licensing and boards, which would hold a meeting in January for the full committee to attend. She appointed to the subcommittee the following members: Senators Fairclough, chair, Giessel and Representatives Hawker, Austerman, and Josephson. There being no objection, the subcommittee was formed. 11:35:18 AM CHAIR FAIRCLOUGH thanked Laura Pierre, Staff, Legislative Budget and Audit Committee, for her work in bringing the committee together and keeping the meeting organized. She also thanked Ms. Curtis and her staff for their work as auditing is not an easy job, particularly when working in less than ideal surroundings during their office renovation. MS. CURTIS highlighted the dedication of her staff, noting that performing nine sunsets in one year is an incredible amount of work along with two special audits.