HOUSE FINANCE COMMITTEE February 23, 1994 1:40 P.M. TAPE HFC 94 - 39, Side 1, #000 - end. TAPE HFC 94 - 39, Side 2, #000 - end. TAPE HFC 94 - 40, Side 1, #000 - #560. CALL TO ORDER Co-Chair Larson called the House Finance Committee meeting to order at 1:40 P.M. PRESENT Co-Chair Larson Representative Hoffman Co-Chair MacLean Representative Martin Vice-Chair Hanley Representative Navarre Representative Brown Representative Parnell Representative Grussendorf Representative Therriault Representative Foster ALSO PRESENT Nancy Slagle, Director, Division of Budget Review, Office of Management and Budget, Office of the Governor; Shelby Stastny, Director, Office of Management and Budget, Office of the Governor; Sharon Barton, Director, Division of Administrative Services, Office of Administration; Nancy Bear Usera, Commissioner, Department of Administration; Karen Rehfeld, Director, Administrative Services, Department of Education; Dan Spencer, Budget Analyst, Office of Management and Budget, Office of the Governor; Richard Pegues, Director, Administrative Services, Department of Law; Thomas Williams, Director, Permanent Fund Dividend Division, Department of Revenue; Janet Clarke, Director, Division of Administrative Services, Department of Health and Social Services; Karen Petersen, (testified via teleconference), Board of Directors, Women in Safe Homes (WISH), Ketchikan; Charles Mallott, (testified via teleconference), Ketchikan Police Department, Ketchikan; Joy Albin, (testified via teleconference), Fairbanks; Cathy Wingrove, (testified via teleconference), Director, Women in Crisis (WICCA), Fairbanks; Bob Irvine, (testified via teleconference), Director, LIFEQUEST, Mat-Su; Michelle Calahan, (testified via teleconference), City Hall, Unalaska; Patrick Owen, (testified via teleconference), Frontier Trauma Center (FTC), Kenai; Wini Crosby, (testified via teleconference), FTC, Kenai; Lauree Hugonin, (testified via teleconference), President, Tundra Women's Coalition (TWC), Bethel; Charmi Olson, (testified via teleconference), 1 Bering Sea Women's Group (BSWG), Nome; Paul Johnson, (testified via teleconference), Alaska Women's Resource Center, Anchorage; Cathy Schindler, (testified via teleconference), Abused Women Aid in Crisis (AWAIC), Anchorage; Mary White, (testified via teleconference), General Manager, KRBD Radio Station, Ketchikan; Dixie Duehn, (testified via teleconference), OCRA, Ketchikan; Gigi Pilcher, (testified via teleconference), Executive Director, Women in Safe Homes (WISH), Ketchikan; Pam Creekmore, (testified via teleconference), WICCA, Fairbanks; Lonna Nevil, (testified via teleconference), WISH, Ketchikan; Clyde Ferguson, (testified via teleconference), Director, Mental Health Center, Bethel. SUMMARY HB 441 An Act reducing certain appropriations for fiscal year 1994; and providing for an effective date. HB 441 was held in Committee for further discussion. HB 455 An Act making and amending operating and capital appropriations and ratifying certain state expenditures; and providing for an effective date. HB 455 was held in Committee for further discussion. GENERAL DISCUSSION Co-Chair Larson provided a brief overview of the present budget status. Currently, projected revenues for the State of Alaska are significantly less than the projected budget. He asked that State residents to participate in identifying a solution to the budget crisis. Discussion followed among Committee members regarding funds contained in the budget reserve and correct usage of those funds. Representative Navarre recommended significant long range budget planning. HOUSE BILL 441 "An Act reducing certain appropriations for fiscal year 1994; and providing for an effective date." KAREN PETERSON, (TESTIFIED VIA TELECONFERENCE), BOARD OF DIRECTORS, WOMEN IN SAFE HOMES (WISH), KETCHIKAN, spoke in opposition to HB 441, specifically the retroactive reduction. She pointed out that most organizations identified for cuts have fixed costs which have already been implemented. Recuperating those costs will severely impact the direct operations of services. 2 CHARLES MALLOTT, (TESTIFIED VIA TELECONFERENCE), KETCHIKAN POLICE DEPARTMENT, KETCHIKAN, spoke in opposition to HB 441 and asked Committee members not to cut funding for women's shelters throughout the State. He advised, that these programs are "cost efficient" noting that women centers receive funding from other sources besides state grants, for example donations. JOY ALBIN, (TESTIFIED VIA TELECONFERENCE), FAIRBANKS, spoke against HB 441 and any further cuts proposed to the mental health component. CATHY WINGROVE, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, WOMEN IN CRISIS (WICCA), FAIRBANKS, spoke against HB 441. She explained that women's shelters have received a maintenance budget for the past three years while the costs of running these shelters has increased. She pointed out that a retroactive charge would remove services for victims of abuse. Shelters can not afford that loss. BOB IRVINE, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, LIFEQUEST, MAT-SU, spoke against HB 441 and the proposed retroactive three percent cut from community mental health services from the FY94 budget. Mr. Irvine asked for long range consideration of adequate "front-end" funding. MICHELLE CALAHAN,(TESTIFIED VIA TELECONFERENCE), CITY HALL, UNALASKA, spoke against HB 441. She requested that domestic violence and sexual assault programs be exempt from funding cuts. PATRICK OWEN, (TESTIFIED VIA TELECONFERENCE), FRONTIER TRAUMA CENTER (FTC), KENAI, spoke against HB 441 expressing concern with decreased funding for community based mental health services. WINI CROSBY, (TESTIFIED VIA TELECONFERENCE), FRONTIER TRAUMA CENTER (FTC), KENAI, spoke against HB 441, echoing the concerns of Mr. Patrick Owen. LAUREE HUGONIN, (TESTIFIED VIA TELECONFERENCE), PRESIDENT, TUNDRA WOMEN'S COALITION (TWC), BETHEL, spoke against HB 441. She urged that continued funding be allocated to programs addressing sexual assault and domestic violence. Ms. Hugonin recommended that budget cuts be taken from capital improvement projects or that a statewide sales tax be implemented to cover budget deficits. CHARMI OLSON, (TESTIFIED VIA TELECONFERENCE), BERING SEA WOMEN'S GROUP (BSWG), NOME, spoke against HB 441. She requested that services for women suffering from domestic 3 violence continue to receive full funding adding that services available in the Nome area are always fully utilized. (Tape Change, HFC 94-39, Side 2). PAULA JOHNSON, (TESTIFIED VIA TELECONFERENCE), ALASKA WOMEN'S RESOURCE CENTER, ANCHORAGE, spoke against HB 441 stating that social service programs are being targeted during revenue depletion. She stressed that retroactive cuts will dramatically affect the programs which assist women moving into the job market from public assistance support. CATHY SCHINDLER, (TESTIFIED VIA TELECONFERENCE), ABUSED WOMEN AID IN CRISIS (AWAIC), ANCHORAGE, spoke against HB 441 stressing the "front line" safety that shelter agencies provide. Most of the funding received by AWAIC originates from social service block money and grants. These are designated funds. The proposed cuts would greatly affect all programs since that money has already been budgeted for the current fiscal year. Ms. Schindler urged the Committee to reconsider the proposed legislation and exempt domestic violence and sexual assault from any further cuts. MARY WHITE, (TESTIFIED VIA TELECONFERENCE), GENERAL MANAGER, KRBD RADIO STATION, KETCHIKAN, spoke against HB 441 and any legislation which might establish the precedence to take money retroactively. She added that public radio stations in the State have received a lot of budget cuts in the past few years and those cuts affect quality service. DIXIE DUEHN, (TESTIFIED VIA TELECONFERENCE), OCRA, KETCHIKAN, spoke against HB 441 and asked that continued funding be provided to OCRA, a program which keeps families together. These funds are administered through the WISH program. GIGI PILCHER, (TESTIFIED VIA TELECONFERENCE), EXECUTIVE DIRECTOR, WOMEN IN SAFE HOMES (WISH), KETCHIKAN, spoke in opposition to HB 441. Ms. Pilcher stressed that further cuts will deplete life threatening services to recipients suffering from domestic violence and sexual assault. She asked that the Committee exempt those services from further budget cuts. PAM CREEKMORE, (TESTIFIED VIA TELECONFERENCE), WICCA, FAIRBANKS, spoke in opposition to HB 441 while encouraging further support of domestic violence programs. LONNA NEVIL, (TESTIFIED VIA TELECONFERENCE), WOMEN IN SAFE 4 HOMES (WISH), KETCHIKAN, spoke in opposition to HB 441 requesting that Committee members become more educated to the amount of and degree of domestic violence occurring within the State to women and children. CLYDE FERGUSON, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, MENTAL HEALTH CENTER, BETHEL, spoke in opposition to HB 441 requesting no further cuts to mental health practitioners particularly in the rural areas. He pointed out there are no private practitioners available in his area. Counselors in the Bethel area are presently functioning at an emergency crisis care level. Mr. Ferguson emphasized that it is the responsibility of the State to provide Alaskans essential services. HB 441 was HELD in Committee for further consideration. HOUSE BILL 455 "An Act making and amending operating and capital appropriations and ratifying certain state expenditures; and providing for an effective date." NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, provided a sectional overview of HB 455, the Supplemental legislation. DEPARTMENT OF ADMINISTRATION * Sec. 3 Public Defender $466.0 This request would provide for the extraordinary number of felony cases and underfunded personal services. * Sec. 4 Office of Public Advocacy $554.7 The request would address increased caseload. Representative Parnell asked if the requests in Sections 3 & 4 resulted from the reductions the Legislature took last year. Ms. Slagle stated those budgets had been reduced last year below projected cost for FY94. * Sec. 5 Personnel/OEEO $100.0 This request would cover arbitration case costs for labor negotiations. * Sec. 6 Personnel/OEEO $18.0 This cost will cover a grievance award cost for a 5 specific employee in that Department. * Sec. 7 Personnel/OEEO $50.0 thousand dollars The request will provide for the court-ordered salary and geographic differential survey. SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF ADMINISTRATION, remarked that the survey conducted provided an evaluation of state salaries versus private sector salaries for similar type of work performed. * Sec. 8 Leases $1,870.2 The request will cover additional lease costs. DAN SPENCER, BUDGET ANALYST, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, explained that the lease budget had been funded below the projected costs for FY94. Last years under funding was $1.8 million dollars under the Governor's request budget. Co-Chair MacLean asked which leases were not covered last year. Ms. Barton offered to provide the Committee with that information. (Tape Change, HFC 94-40, Side 1). * New Section #51 Personnel/OEEO $35.0 The request would cover ethics complaints grievance award cases. DEPARTMENT OF LAW * Sec. 9 Legal Services & Operations $325.4 The funding will pay judgement and claims against the State. RICHARD PEGUES, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF LAW, explained the cost would cover nineteen judgments. During the year, more judgments were received than funds allocated. DEPARTMENT OF EDUCATION * Sec. 9a Pupil transportation $50.0 These costs would provide for the legal fees 6 related to pupil transportation issues (Ten Eyck versus the State). DEPARTMENT OF LAW * Sec. 10 Legal Services & Operations $462.5 These fees will address the reapportionment case - Southeast Conference versus Hickel. Mr. Pegues pointed out that the amount currently requested for reapportionment is the same amount requested last year and not granted in Conference Committee. The amount requested includes the added interest costs from last year's request. DEPARTMENT OF REVENUE * Sec. 11 Permanent Fund Dividend $142.6 These costs will cover additional costs of printing and delivery of the 1994 PFD applications. THOMAS WILLIAMS, DIRECTOR, PERMANENT FUND DIVIDEND DIVISION, DEPARTMENT OF REVENUE, explained the original contractor was not paid because services were not completed. The Department was advised late in the printing schedule that the contractor could not provide the product by the deadline. Consequently, there was $142 thousand dollars of additional expenses in order to get the applications available on time. * Sec. 12 Permanent Fund Corporation $3,195.0 Cost to cover the additional equity management and international custody fees. DEPARTMENT OF EDUCATION * Sec. 13 Foundation Program $1,500.0 Funds to cover increased student enrollments. KAREN REHFELD, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF EDUCATION, stated the amount requested was the total amount needed based on a count taken in October, 1993. That amount will be updated, March, 1994, and will affect the request. * Sec. 14 Vocational Education - federal grants -0- 7 Funds to cover the ratification of expenditures. DEPARTMENT OF HEALTH AND SOCIAL SERVICES * Sec. 15 PFD Hold Harmless $244.4 Costs to cover the increased number of eligible recipients. * Sec. 16 Medicaid Facilities $7,674.5 Funds to cover judgement and settlements against state by ASHNHA and others. JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, explained that the request is comprised of three main cases, two of which are settlements with the Attorney General's office related to Our Lady of Compassion's appeal issue and with Humana Hospital, a 1986 rate setting settlement. Both of these settlements can be shared 50/50 percent with the federal government. The largest amount of the request originates from a judgement from the supreme court for a rate setting issue dispute over rates paid nursing homes with the Alaska State Hospital Nursing Home Association. She added that it is anticipated that the level of federal participation will reduce the needed amount. Representative Hanley asked the amount of anticipated match funds due from the federal government. Ms. Clarke stated the request for federal participation would be for the years 1991, 1992 and 1993, and it has been received. That information will be available in March, 1994. Ms. Clarke offered to provide that information upon receipt. * Sec. 17 Medicaid Facilities $5,045.0 Funds to cover FY93 bills paid in FY94 and the increased participants in FY94. Representative Hanley commented on the request for an additional supplemental for fiscal year 1993. Ms. Clarke pointed out that last year, the Department offered to relinquish $4.5 million dollars in the Medicaid program which held true with projections until the fourth quarter (April, May and June 1994). At that time, bills were provided remaining from 1993. The magnitude of those expenditures resulted in the proposed request. * Sec. 18 Medicaid Facilities $2,600.0 8 Funds to cover for Charter North and North Star Hospital (disproportionate share claims). * Sec. 19 Indian Health Service $3,567.4 Costs to cover the increased Indian Health Service billings. * Sec. 20 General Relief Medical $887.5 Funds for the $246.6 thousand dollars in FY93 carry forward; $640.9 thousand dollars increased program growth. Per Representative Therriault's request, Ms. Clarke explained "disproportionate share claims", a program which can be participated in through Medicaid. These are disproportionate share payments given to psychiatric hospitals because those hospitals serve a disproportionate share of either Medicaid clients or low income people. When Alaska began participating in this program, new federal dollars were brought into the State in order to match current funds spent at API. HB 455 was HELD in Committee for further consideration. ADJOURNMENT The meeting adjourned at 340 P.M. HOUSE FINANCE COMMITTEE February 23, 1994 1:40 P.M. TAPE HFC 94 - 39, Side 1, #000 - end. TAPE HFC 94 - 39, Side 2, #000 - end. TAPE HFC 94 - 40, Side 1, #000 - #560. CALL TO ORDER Co-Chair Larson called the House Finance Committee meeting to order at 1:40 P.M. PRESENT Co-Chair Larson Representative Hoffman Co-Chair MacLean Representative Martin Vice-Chair Hanley Representative Navarre Representative Brown Representative Parnell Representative Grussendorf Representative Therriault Representative Foster 9 ALSO PRESENT Nancy Slagle, Director, Division of Budget Review, Office of Management and Budget, Office of the Governor; Shelby Stastny, Director, Office of Management and Budget, Office of the Governor; Sharon Barton, Director, Division of Administrative Services, Office of Administration; Nancy Bear Usera, Commissioner, Department of Administration; Karen Rehfeld, Director, Administrative Services, Department of Education; Dan Spencer, Budget Analyst, Office of Management and Budget, Office of the Governor; Richard Pegues, Director, Administrative Services, Department of Law; Thomas Williams, Director, Permanent Fund Dividend Division, Department of Revenue; Janet Clarke, Director, Division of Administrative Services, Department of Health and Social Services; Karen Petersen, (testified via teleconference), Board of Directors, Women in Safe Homes (WISH), Ketchikan; Charles Mallott, (testified via teleconference), Ketchikan Police Department, Ketchikan; Joy Albin, (testified via teleconference), Fairbanks; Cathy Wingrove, (testified via teleconference), Director, Women in Crisis (WICCA), Fairbanks; Bob Irvine, (testified via teleconference), Director, LIFEQUEST, Mat-Su; Michelle Calahan, (testified via teleconference), City Hall, Unalaska; Patrick Owen, (testified via teleconference), Frontier Trauma Center (FTC), Kenai; Wini Crosby, (testified via teleconference), FTC, Kenai; Lauree Hugonin, (testified via teleconference), President, Tundra Women's Coalition (TWC), Bethel; Charmi Olson, (testified via teleconference), Bering Sea Women's Group (BSWG), Nome; Paul Johnson, (testified via teleconference), Alaska Women's Resource Center, Anchorage; Cathy Schindler, (testified via teleconference), Abused Women Aid in Crisis (AWAIC), Anchorage; Mary White, (testified via teleconference), General Manager, KRBD Radio Station, Ketchikan; Dixie Duehn, (testified via teleconference), OCRA, Ketchikan; Gigi Pilcher, (testified via teleconference), Executive Director, Women in Safe Homes (WISH), Ketchikan; Pam Creekmore, (testified via teleconference), WICCA, Fairbanks; Lonna Nevil, (testified via teleconference), WISH, Ketchikan; Clyde Ferguson, (testified via teleconference), Director, Mental Health Center, Bethel. SUMMARY HB 441 An Act reducing certain appropriations for fiscal year 1994; and providing for an effective date. HB 441 was held in Committee for further discussion. 10 HB 455 An Act making and amending operating and capital appropriations and ratifying certain state expenditures; and providing for an effective date. HB 455 was held in Committee for further discussion. GENERAL DISCUSSION Co-Chair Larson provided a brief overview of the present budget status. Currently, projected revenues for the State of Alaska are significantly less than the projected budget. He asked that State residents to participate in identifying a solution to the budget crisis. Discussion followed among Committee members regarding funds contained in the budget reserve and correct usage of those funds. Representative Navarre recommended significant long range budget planning. HOUSE BILL 441 "An Act reducing certain appropriations for fiscal year 1994; and providing for an effective date." KAREN PETERSON, (TESTIFIED VIA TELECONFERENCE), BOARD OF DIRECTORS, WOMEN IN SAFE HOMES (WISH), KETCHIKAN, spoke in opposition to HB 441, specifically the retroactive reduction. She pointed out that most organizations identified for cuts have fixed costs which have already been implemented. Recuperating those costs will severely impact the direct operations of services. CHARLES MALLOTT, (TESTIFIED VIA TELECONFERENCE), KETCHIKAN POLICE DEPARTMENT, KETCHIKAN, spoke in opposition to HB 441 and asked Committee members not to cut funding for women's shelters throughout the State. He advised, that these programs are "cost efficient" noting that women centers receive funding from other sources besides state grants, for example donations. JOY ALBIN, (TESTIFIED VIA TELECONFERENCE), FAIRBANKS, spoke against HB 441 and any further cuts proposed to the mental health component. CATHY WINGROVE, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, WOMEN IN CRISIS (WICCA), FAIRBANKS, spoke against HB 441. She explained that women's shelters have received a maintenance budget for the past three years while the costs of running these shelters has increased. She pointed out that a retroactive charge would remove services for victims of abuse. Shelters can not afford that loss. BOB IRVINE, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, 11 LIFEQUEST, MAT-SU, spoke against HB 441 and the proposed retroactive three percent cut from community mental health services from the FY94 budget. Mr. Irvine asked for long range consideration of adequate "front-end" funding. MICHELLE CALAHAN,(TESTIFIED VIA TELECONFERENCE), CITY HALL, UNALASKA, spoke against HB 441. She requested that domestic violence and sexual assault programs be exempt from funding cuts. PATRICK OWEN, (TESTIFIED VIA TELECONFERENCE), FRONTIER TRAUMA CENTER (FTC), KENAI, spoke against HB 441 expressing concern with decreased funding for community based mental health services. WINI CROSBY, (TESTIFIED VIA TELECONFERENCE), FRONTIER TRAUMA CENTER (FTC), KENAI, spoke against HB 441, echoing the concerns of Mr. Patrick Owen. LAUREE HUGONIN, (TESTIFIED VIA TELECONFERENCE), PRESIDENT, TUNDRA WOMEN'S COALITION (TWC), BETHEL, spoke against HB 441. She urged that continued funding be allocated to programs addressing sexual assault and domestic violence. Ms. Hugonin recommended that budget cuts be taken from capital improvement projects or that a statewide sales tax be implemented to cover budget deficits. CHARMI OLSON, (TESTIFIED VIA TELECONFERENCE), BERING SEA WOMEN'S GROUP (BSWG), NOME, spoke against HB 441. She requested that services for women suffering from domestic violence continue to receive full funding adding that services available in the Nome area are always fully utilized. (Tape Change, HFC 94-39, Side 2). PAULA JOHNSON, (TESTIFIED VIA TELECONFERENCE), ALASKA WOMEN'S RESOURCE CENTER, ANCHORAGE, spoke against HB 441 stating that social service programs are being targeted during revenue depletion. She stressed that retroactive cuts will dramatically affect the programs which assist women moving into the job market from public assistance support. CATHY SCHINDLER, (TESTIFIED VIA TELECONFERENCE), ABUSED WOMEN AID IN CRISIS (AWAIC), ANCHORAGE, spoke against HB 441 stressing the "front line" safety that shelter agencies provide. Most of the funding received by AWAIC originates from social service block money and grants. These are designated funds. The proposed cuts would greatly affect all programs since that money has already been budgeted for the current fiscal year. Ms. Schindler urged the Committee 12 to reconsider the proposed legislation and exempt domestic violence and sexual assault from any further cuts. MARY WHITE, (TESTIFIED VIA TELECONFERENCE), GENERAL MANAGER, KRBD RADIO STATION, KETCHIKAN, spoke against HB 441 and any legislation which might establish the precedence to take money retroactively. She added that public radio stations in the State have received a lot of budget cuts in the past few years and those cuts affect quality service. DIXIE DUEHN, (TESTIFIED VIA TELECONFERENCE), OCRA, KETCHIKAN, spoke against HB 441 and asked that continued funding be provided to OCRA, a program which keeps families together. These funds are administered through the WISH program. GIGI PILCHER, (TESTIFIED VIA TELECONFERENCE), EXECUTIVE DIRECTOR, WOMEN IN SAFE HOMES (WISH), KETCHIKAN, spoke in opposition to HB 441. Ms. Pilcher stressed that further cuts will deplete life threatening services to recipients suffering from domestic violence and sexual assault. She asked that the Committee exempt those services from further budget cuts. PAM CREEKMORE, (TESTIFIED VIA TELECONFERENCE), WICCA, FAIRBANKS, spoke in opposition to HB 441 while encouraging further support of domestic violence programs. LONNA NEVIL, (TESTIFIED VIA TELECONFERENCE), WOMEN IN SAFE HOMES (WISH), KETCHIKAN, spoke in opposition to HB 441 requesting that Committee members become more educated to the amount of and degree of domestic violence occurring within the State to women and children. CLYDE FERGUSON, (TESTIFIED VIA TELECONFERENCE), DIRECTOR, MENTAL HEALTH CENTER, BETHEL, spoke in opposition to HB 441 requesting no further cuts to mental health practitioners particularly in the rural areas. He pointed out there are no private practitioners available in his area. Counselors in the Bethel area are presently functioning at an emergency crisis care level. Mr. Ferguson emphasized that it is the responsibility of the State to provide Alaskans essential services. HB 441 was HELD in Committee for further consideration. HOUSE BILL 455 "An Act making and amending operating and capital appropriations and ratifying certain state expenditures; and providing for an effective date." 13 NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, provided a sectional overview of HB 455, the Supplemental legislation. DEPARTMENT OF ADMINISTRATION * Sec. 3 Public Defender $466.0 This request would provide for the extraordinary number of felony cases and underfunded personal services. * Sec. 4 Office of Public Advocacy $554.7 The request would address increased caseload. Representative Parnell asked if the requests in Sections 3 & 4 resulted from the reductions the Legislature took last year. Ms. Slagle stated those budgets had been reduced last year below projected cost for FY94. * Sec. 5 Personnel/OEEO $100.0 This request would cover arbitration case costs for labor negotiations. * Sec. 6 Personnel/OEEO $18.0 This cost will cover a grievance award cost for a specific employee in that Department. * Sec. 7 Personnel/OEEO $50.0 thousand dollars The request will provide for the court-ordered salary and geographic differential survey. SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF ADMINISTRATION, remarked that the survey conducted provided an evaluation of state salaries versus private sector salaries for similar type of work performed. * Sec. 8 Leases $1,870.2 The request will cover additional lease costs. DAN SPENCER, BUDGET ANALYST, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, explained that the lease budget had been funded below the projected costs for FY94. Last years under funding was $1.8 million dollars under the 14 Governor's request budget. Co-Chair MacLean asked which leases were not covered last year. Ms. Barton offered to provide the Committee with that information. (Tape Change, HFC 94-40, Side 1). * New Section #51 Personnel/OEEO $35.0 The request would cover ethics complaints grievance award cases. DEPARTMENT OF LAW * Sec. 9 Legal Services & Operations $325.4 The funding will pay judgement and claims against the State. RICHARD PEGUES, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF LAW, explained the cost would cover nineteen judgments. During the year, more judgments were received than funds allocated. DEPARTMENT OF EDUCATION * Sec. 9a Pupil transportation $50.0 These costs would provide for the legal fees related to pupil transportation issues (Ten Eyck versus the State). DEPARTMENT OF LAW * Sec. 10 Legal Services & Operations $462.5 These fees will address the reapportionment case - Southeast Conference versus Hickel. Mr. Pegues pointed out that the amount currently requested for reapportionment is the same amount requested last year and not granted in Conference Committee. The amount requested includes the added interest costs from last year's request. DEPARTMENT OF REVENUE * Sec. 11 Permanent Fund Dividend $142.6 These costs will cover additional costs of printing and delivery of the 1994 PFD 15 applications. THOMAS WILLIAMS, DIRECTOR, PERMANENT FUND DIVIDEND DIVISION, DEPARTMENT OF REVENUE, explained the original contractor was not paid because services were not completed. The Department was advised late in the printing schedule that the contractor could not provide the product by the deadline. Consequently, there was $142 thousand dollars of additional expenses in order to get the applications available on time. * Sec. 12 Permanent Fund Corporation $3,195.0 Cost to cover the additional equity management and international custody fees. DEPARTMENT OF EDUCATION * Sec. 13 Foundation Program $1,500.0 Funds to cover increased student enrollments. KAREN REHFELD, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT OF EDUCATION, stated the amount requested was the total amount needed based on a count taken in October, 1993. That amount will be updated, March, 1994, and will affect the request. * Sec. 14 Vocational Education - federal grants -0- Funds to cover the ratification of expenditures. DEPARTMENT OF HEALTH AND SOCIAL SERVICES * Sec. 15 PFD Hold Harmless $244.4 Costs to cover the increased number of eligible recipients. * Sec. 16 Medicaid Facilities $7,674.5 Funds to cover judgement and settlements against state by ASHNHA and others. JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, explained that the request is comprised of three main cases, two of which are settlements with the Attorney General's office related to Our Lady of Compassion's appeal issue and with Humana Hospital, a 1986 rate setting settlement. Both of these settlements can be shared 50/50 percent with the federal 16 government. The largest amount of the request originates from a judgement from the supreme court for a rate setting issue dispute over rates paid nursing homes with the Alaska State Hospital Nursing Home Association. She added that it is anticipated that the level of federal participation will reduce the needed amount. Representative Hanley asked the amount of anticipated match funds due from the federal government. Ms. Clarke stated the request for federal participation would be for the years 1991, 1992 and 1993, and it has been received. That information will be available in March, 1994. Ms. Clarke offered to provide that information upon receipt. * Sec. 17 Medicaid Facilities $5,045.0 Funds to cover FY93 bills paid in FY94 and the increased participants in FY94. Representative Hanley commented on the request for an additional supplemental for fiscal year 1993. Ms. Clarke pointed out that last year, the Department offered to relinquish $4.5 million dollars in the Medicaid program which held true with projections until the fourth quarter (April, May and June 1994). At that time, bills were provided remaining from 1993. The magnitude of those expenditures resulted in the proposed request. * Sec. 18 Medicaid Facilities $2,600.0 Funds to cover for Charter North and North Star Hospital (disproportionate share claims). * Sec. 19 Indian Health Service $3,567.4 Costs to cover the increased Indian Health Service billings. * Sec. 20 General Relief Medical $887.5 Funds for the $246.6 thousand dollars in FY93 carry forward; $640.9 thousand dollars increased program growth. Per Representative Therriault's request, Ms. Clarke explained "disproportionate share claims", a program which can be participated in through Medicaid. These are disproportionate share payments given to psychiatric hospitals because those hospitals serve a disproportionate share of either Medicaid clients or low income people. When Alaska began participating in this program, new federal dollars were brought into the State in order to match 17 current funds spent at API. HB 455 was HELD in Committee for further consideration. ADJOURNMENT The meeting adjourned at 340 P.M. 18