HOUSE FINANCE COMMITTEE March 18, 1994 1:30 p.m. TAPE HFC 94-68, Side 1, #000 - end. TAPE HFC 94-68, Side 2, #000 - end. TAPE HFC 94-69, Side 1, #000 - 645. CALL TO ORDER Co-Chair Larson called the House Finance Committee to order at 1:30 p.m. PRESENT Co-Chair Larson Representative Hoffman Co-Chair MacLean Representative Martin Vice-Chair Hanley Representative Navarre Representative Brown Representative Parnell Representative Foster Representative Therriault Representative Grussendorf ALSO PRESENT Representative Brice; Mary Sansome, Assistant Attorney General-General Civil Section, Department of Law; Jim Clark, General Counsel, Alaska Forest Association, Juneau; Jan Hansen, Director, Division of Public Assistance, Department of Health and Social Services. SUMMARY INFORMATION HB 409 "An Act relating to the maximum amount of assistance that may be granted under the adult public assistance program and the program of aid to families with dependent children; proposing a special demonstration project within the program of aid to families with dependent children and directing the Department of Health and Social Services to seek waivers from the federal government to implement the project; and providing for an effective date." HB 409 was HELD in Committee for further discussion. SB 178 "An Act relating to civil nuisance actions; and providing for an effective date." HCS CSSB 178 (FIN) was reported out of Committee with "no recommendation" and with a zero fiscal note by the Department of Law. 1 HOUSE BILL NO. 409 "An Act relating to the maximum amount of assistance that may be granted under the adult public assistance program and the program of aid to families with dependent children; proposing a special demonstration project within the program of aid to families with dependent children and directing the Department of Health and Social Services to seek waivers from the federal government to implement the project; and providing for an effective date." MARK GREENBERG, CENTER FOR LAW AND SOCIAL POLICY, WASHINGTON D.C. spoke in support of three features of the proposed demonstration project: * An increase in work incentives for Aide to Families with Dependent Children (AFDC) family members; * The waiver of the 100 hour rule, that currently disqualifies two parent families with a full time worker regardless of the family's income's; and * Waivers of vehicle equity which disqualifies families who own a single vehicle worth more than $2,500. Mr. Greenberg discussed the workfare requirement. He emphasized that running a workfare program costs money. He asserted that evidence implies that workfare programs do not dramatically raise employment. He questioned if funding would be better spent to improve job programs. Mr. Greenberg questioned the equality of reducing payments to all AFDC and Adult Public Assistance (APA) recipients in order to fund a program available to a few. Representative Brown asked if federal welfare reform will include waivers allowed for in HB 409. Mr. Greenberg pointed out that the federal administration has not introduced legislation. He observed that federal policy encourages state reform but requires programs to be cost neutral to the federal government. HB 409 was HELD in Committee for further discussion. SENATE BILL NO. 178 "An Act relating to civil nuisance actions; and providing for an effective date." 2 Representative Brown provided members with AMENDMENTS 8 and 9 (copies on file). She explained that Amendment 8 would clarify that definitions of "nuisance" as a civil public or private nuisance. Representative Parnell noted that a motion was pending from the 3/17/94 House Finance Committee meeting, to report HCS CSSB178 (FIN) out of Committee. Representative Therriault WITHDREW HIS MOTION to report HCS CSSB178 (FIN) out of Committee. Representative Brown MOVED to ADOPT AMENDMENT 8. She stressed that Amendment 8 attempts to clarify that current statutes and regulations regarding "nuisances" cover private and public nuicances. She observed that court interpretations have found that "nuisance" means public nuisance. MARIE SANSOME, ASSISTANT ATTORNEY GENERAL-GENERAL CIVIL SECTION, DEPARTMENT OF LAW agreed that Amendment 8 would clarify that private nuisances would be included in the context of air pollution statutes which cover public nuisances. Representative Hanley referenced 18 AAC 50.110. He suggested that if there is a violation of the terms or conditions of a statute or regulation than a person has the right to sue for a private nuisance. Ms. Sansome stressed that definitions of nuisances addressed by the amendment are related only to the application of the statutes as to public nuisances. She suggested that the amendment would clarify subsection (d). JIM CLARK, GENERAL COUNSEL, ALASKA FOREST ASSOCIATION, JUNEAU observed that the point of measurement is at the property line. He alleged that because showings are made at the property line it does not matter if it is a public or private nuisance. Representative Hanley questioned if 18 ACC 50.110 defines air pollution as a nuisance. Representative Brown suggested that the Committee expects and intends that page 1, line 12 triggers statutes and regulations that protect people from private nuisances and therefore Amendment 8 is unnecessary. Ms. Sansome referred to subsection (d) she noted that it was added at the request of Mr. Clark. She emphasized that there are legal opinions that statutes cited would only 3 cover public nuisances. She suggested that if the intent is to reflect that the statute definitions should apply to a private nuisance that Amendment 8 should be adopted. She suggested that there is a potential conflict between subsection (d) and section 2. Mr. Clark reiterated that permits are issued based on conditions at the property line. Ms. Sansome and Mr. Clark disagreed with the interpretation of statutes in regards to public and private nuisances. Mr. Clark asserted that Amendment 8 would interfere with the affect of the shield provided by subsection (d). He alleged that adoption of Amendment 8 would require changes to AS 46.03.900. (Tape Change, HFC 94-68, Side 2) Co-Chair Larson reiterated Representative Brown's concern that the legislation apply to private nuisances. Mr. Clark stressed that if a violation of the permit occurs a private nuisance suit could be initiated. Representative Navarre observed that permits deal with public nuisances. He stressed that if the permit is not violated and a civil claim existed the private property owner would not be able to bring action. He restated that if there is a private nuisance caused by something that did not violate a public permit process an action could not be brought. He summarized that the issue is whether or not private nuisances are included in the public permit process. Mr. Clark reiterated that if there is a violation of the regulation the shield is down. Ms. Sansome noted that according to AS 46.03.870 (a), permits and regulations issued by the state are for the benefit of the state and public and do not create a right in a person. She doubted that a person could demonstrate that the violation of the air nuisances statute created a right to a remedy. Mr. Clark asserted that private nuisance suits are available except when the shield is up. He observed that the legislation describes when the shield is up and when it is down. Ms. Sansome questioned if air pollution regulations would cover private nuisances if the legislation is adopted. Mr. Clark maintained that the right of action for a private nuisance is created in section 1 of the legislation. Representative Brown restated her motion to ADOPT AMENDMENT 8. Representative Therriault OBJECTED. A roll call vote was taken on the motion. IN FAVOR: Brown, Hoffman, Navarre OPPOSED: Parnell, Therriault, Foster, Grussendorf, Martin, 4 MacLean, Larson The MOTION FAILED (3-8). Representative Brown MOVED to ADOPT AMENDMENT 9 (copy on file). She explained that the amendment rephrases AMENDMENT 1. The amendment would provide that the shield is up when there is a "showing by the licensee, permittee, or person subject to the order that the proposed activity will not result in any emission or discharge that is injurious to human health or welfare, animal or plant life, or property, or that would injuriously interfere with the enjoyment of life or property; or". She stated that she understood that Amendment 8 was not adopted because the Committee feels that it is unnecessary and that private nuisances are covered. She explained that Amendment 9 will make clear that private nuisances are expressly addressed in the permitting process. Mr. Clark noted that Amendment 1 was offered by the Department of Law. He clarified that a nuisance showing is not currently being made in respect to water. He maintained that Amendment 9 would create a new condition which would make the legislation prospective. There are regulations requiring showings in regards to air and solid waste. Representative Therriault OBJECTED to the motion to ADOPT AMENDMENT 9. A roll call vote was taken on the motion. IN FAVOR: Brown, Grussendorf, Hoffman, Navarre, MacLean OPPOSED: Therriault, Foster, Hanley, Martin, Parnell, Larson The MOTION FAILED (5-6). Representative Brown referred to subsection (f). Subsection (f) provides that the state is held harmless from inverse condemnation. She observed that the state of California has a similar shield in respect to timber operations. She stressed that individuals are suing the state of California, not for inverse condemnation, but for violations under the permitting processes. Representative Brown objected to line 30, page 2, to award full reasonable attorney fees and costs to a person who prevails in defense of a claim or court action. She opposed changing the rules of civil procedure in this way. She emphasized that there is currently judicial discretion to look at the circumstances and determine how court costs are spread. Representative Therriault MOVED to REPORT HCS CSSB 178 (FIN) 5 out of Committee with individual recommendations and with the accompanying fiscal note. Representative Navarre OBJECTED.A roll call vote was taken on the motion. IN FAVOR: Foster, Grussendorf, Hanley, Martin, Parnell, Therriault, MacLean, Larson OPPOSED: Hoffman, Navarre, Brown The MOTION PASSED (8-3). HCS CSSB 178 (FIN) was reported out of Committee with "no recommendation" and with a zero fiscal note by the Department of Law. HOUSE BILL NO. 409 "An Act relating to the maximum amount of assistance that may be granted under the adult public assistance program and the program of aid to families with dependent children; proposing a special demonstration project within the program of aid to families with dependent children and directing the Department of Health and Social Services to seek waivers from the federal government to implement the project; and providing for an effective date." Representative Therriault provided members with AMENDMENT 1 (copy on file). He MOVED to ADOPT AMENDMENT 1. Representative Grussendorf OBJECTED. Representative Therriault explained that Amendment 1 would allow the Fairbanks North Star Borough to participate in the demonstration project. He maintained that the cost of including Fairbanks in the demonstration project will not exceed revenues anticipated to be raised by the legislation. REPRESENTATIVE TOM BRICE spoke in opposition to Amendment 1. He expressed concern that the workfare will not be effective in achieving the desired goal. He suggested that the workfare program will not result in the gain of marketable jobs. Representative Hanley disagreed that workfare programs will not encourage marketable job skills. Members discussed the introduction of House Finance Committee legislation. Representative Therriault noted support of individuals in his district for Amendment 1 to HB 409. He clarified that Fairbanks cannot be included in the demonstration project without the adoption of Amendment 1. 6 A roll call vote was taken on the motion to ADOPT AMENDMENT 1 IN FAVOR: Foster, Hanley, Martin, Parnell, Therriault, MacLean, Larson OPPOSED: Brown, Grussendorf, Hoffman Representative Navarre was not present for the vote. The MOTION PASSED (8-3). JAN HANSEN, DIRECTOR, DIVISION OF MEDICAL ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES observed that the adoption of Amendment 1 would increase the cost of the legislation by $300.0 thousand dollars annually in FY 95 - 99. (Tape Change, HFC 94-69, Side 1) Representative Brown provided members with AMENDMENT 2 (copy on file). She MOVED to AMEND Amendment 2 by including, Amendment to Amendment 1 (copy on file). There being NO OBJECTION, it was so ordered. Representative Brown explained that Amendment 2 would create the Healthy Families Program. She stressed that the program would address a number of social problems. She noted that section 5 would provide that the program is funded through the ratable reductions in AFDC and APA. She observed that the sponsor may not support funding the program through the ratable reduction. Representative Martin asserted that the program should be reviewed by the House Health, Education and Social Services Committee. Representative Brown noted that the House Health, Education and Social Services Committee declined to entertain amendments while the bill was before their Committee. Representative Hanley did not feel that the program could be funded at this time. Representative Brown MOVED to delete section 5, Funding Intent, from AMENDMENT 2. There being NO OBJECTION, it was so ordered. Representative Brown WITHDREW AMENDMENT 2. She expressed her intention to offer Amendment 2 at another time. Representative Navarre MOVED to add a new paragraph to read, "(4) an area consisting of a home rule city that is contained within the boundaries of a second class borough located on a peninsula within a hundred miles of Anchorage, with a population of 65,000 persons or more and the second 7 class borough described in this paragraph." Representative Navarre WITHDREW his MOTION. Co-Chair MacLean provided members with AMENDMENT 3 (copy on file). She explained that Amendment 3 would allow the North Slope Borough to participate in the demonstration project. Representative Hanley spoke in support of Amendment 3. He noted that the Department of Health and Social Services has decided to allow all persons in rural areas to participate. There being NO OBJECTION, AMENDMENT 3 was adopted. Representative Navarre asked if the amendments adopted by the Committee would necessitate an increase in the ratable reduction. Representative Hanley stated that Amendment 3 would not result in an increase to the fiscal note. He reiterated that Amendment 1 will not result in a net increase in the ratable reduction. Representative Brown provided members with AMENDMENT 4 (copy on file). She explained that Amendment 4 would delete the ratable reduction to Adult Public Assistance (APA). She argued that the majority of APA recipients are elderly or disabled persons. She questioned if APA benefits should be reduced in order to fund the demonstration project. She pointed out that the APA clinet group is not in a position to benefit from the results of the demonstration project since they are unlikely to return to the work force. Representative Brice spoke in support of Amendment 4. He raised the issue of equality. He did not feel that APA clients should be asked to pay for a program that will not benefit them. Representative Brown MOVED to ADOPT AMENDMENT 4. In response to a question by Co-Chair Larson, Representative Hanley observed that APA payments are at 110 percent of the poverty level, AFDC payments are at 74 percent of the poverty level. He explained that the Department of Health and Social Services did not want the discrepancy between the two recipients to increase. He acknowledge that the there are inequities in the legislation. Ms. Hansen reiterated that the Department of Health and Social Services desires that any reduction be across the board. She noted that there is a disparity between the level of payments for AFDC and APA. Representative Brown emphasized that there is little chance that clients served by APA will be able to return to the 8 work force. She noted that APA clients are unable to work. Representative Brown suggested that the program could be funded without the inclusion of APA. Members discussed anticipated revenues. Ms. Hansen noted that an appropriation from the legislature is needed to fund FY 95. She acknowledged that the ratable reduction is in excess of what is need in FY 95. She reiterated the Department's position to maintain an across the board reduction. She clarified that APA clients are living outside of state institutions. Representative Hanley OBJECTED to the adoption of AMENDMENT 4. A roll call vote was taken on the motion. IN FAVOR: Brown, Grussendorf, Hoffman, Navarre, Larson OPPOSED: Hanley, Martin, Parnell, Therriault, MacLean Representative Foster was not present for the vote. The MOTION FAILED (5-5). HB 409 was HELD in Committee for further discussion. ADJOURNMENT The meeting adjourned at 3:40 p.m. 9