HOUSE FINANCE COMMITTEE March 2, 1998 2:00 P.M. TAPE HFC 98 - 47, Side 1. TAPE HFC 98 - 47, Side 2. TAPE HFC 98 - 48, Side 1. TAPE HFC 98 - 48, Side 2. CALL TO ORDER Co-Chair Hanley called the House Finance Committee meeting to order at 2:00 P.M. PRESENT Co-Chair Hanley Representative Kelly Co-Chair Therriault Representative Grussendorf Representative Martin Representative G. Davis Representative Foster Representative Mulder Representatives Kohring, J. Davies and Moses were not present for the meeting. ALSO PRESENT Representative Ivan Ivan, (Testified via Teleconference), Akink; Representative Joe Ryan; Representative Jerry Sanders; Annalee McConnell, Director, Office of Management and Budget, Office of the Governor; Dan Spencer, Chief Budget Analyst, Office of Management and Budget, Office of the Governor; Mike Irwin, Commissioner, Department of Community and Regional Affairs; John Bitney, Alaska Housing Finance Corporation, Anchorage; Dwayne Peeples, Director, Division of Administrative Services, Department of Corrections; Janet Clarke, Director, Division of Administrative Services, Department of Health and Social Services; Karen Pearson, Health Program Manager, Division of Public Health, Department of Health and Social Services; Nico Bus, Budget Coordinator, Department of Military and Veterans Affairs; Nancy Slagle, Director, Division of Administrative Services, Department of Transportation and Public Services; Tom Brigham, Director, Division of Statewide Planning, Department of Transportation and Public Facilities; Kevin Brooks, Director, Division of Administrative Services, Department of Fish and Game; Rebecca Gamez, Director, Division of Employment Services, Department of Labor; Sharon Barton, Director, Division of Administrative Services, Department of Administration; Keith Gerken, Architect-Facilities, Division of General Services, Department of Administration; Dean Guaneli, Chief Assistant Attorney General, Criminal Division, Department of Law; Mary Lou Burton, (Testified via Teleconference), University of Alaska, Fairbanks. SUMMARY HB 370 An Act making an appropriation for relief of the 1997 fishery disaster in Bristol Bay and on the Kuskokwim River; and providing for an effective date. HB 370 was HELD in Committee for further consideration. HB 461 An Act making supplemental and special appropriations; and providing for an effective date. HB 461 was HELD in Committee for further consideration. HOUSE BILL NO. 370 "An Act making an appropriation for relief of the 1997 fishery disaster in Bristol Bay and on the Kuskokwim River; and providing for an effective date." REPRESENTATIVE IVAN IVAN, (TESTIFIED VIA TELECONFERENCE), AKINK, explained that HB 370 requests $2.3 million dollars in general funds as a match for the $7 million federal dollars granted through the Magnuson-Stevens fund. The funds would provide for programs designed to assist communities and fishermen in the Kuskokwin and Bristol Bay regions which the Administration has been declared an economic disaster. The proclamation was issued in response to the poor fishing returns occurring in those areas. The State share would be $2.3 million dollars. He continued, with in-kind contributions provided by the communities and the Department of Community and Regional Affairs (DCRA), the actual amount requested from the Legislature would be $1.875 million dollars. The following programs would be funded from the appropriation: ? Community grant program for projects that are of direct and/or indirect benefit to the fisheries that sustain the economic viability of communities and would help to diversify the economy or assess the economic and social effects of the commercial fisheries failure. ? Loan programs to the Bristol Bay, Chignik and Kuskokwin permit holders who are in financial crisis. The Division of Investments at DCRA would administer the program. ? Economic planning in the Kuskokwin region. The funds would be used to enhance economic planning capability and/or continue economic planning process and procedures. ? Fisheries education, training and research such as smelt outmigration, salmon escarpment counts and selected resource management issues. Representative Ivan summarized that a portion of the funding would be used by DCRA to cover administrative costs associated with the program. REPRESENTATIVE JOE RYAN testified in support of the purposed legislation. He spoke about the intense poverty in village areas as a result of poor economic fishing conditions last summer. In those areas, some of the utility cooperatives have threatened to close, as the villagers have not been able to afford to pay their bills. Representative Ryan explained that DCRA initially requested federal funding, although, the Federal Emergency Management Agency (FEMA) stipulated that this type of economic disaster request would not fall under their privy. Following that meeting, the U.S. Department of Commerce stepped in; FEMA did not want to establish a precedent of granting money for this type of need because of the resulting repercussions which could occur in other states. Representative Ryan noted, following much discussion, the federal government agreed to help provide funding to create work projects in the villages so that they would be able to get "back on their feet". Unfortunately, that program will not come into effect until August 1998, after the next fishing season. A timing which would not address the current crisis. Representative Ryan reiterated that the people in this area are desperate and need Legislative help. He urged the Committee's support of the measure. Representative Martin questioned why the legislation had been limited to two regions while the entire area had experienced hardship. Co-Chair Hanley pointed out that there is criteria established by the federal government, which determines the disaster category. He clarified that this is a federal program in which the State would be requested to match. REPRESENTATIVE JERRY SANDERS commented that the majority of people affected by the fish shortage live in this area and have a very low yearly income. They often make less than $7 thousand dollars a year. He stressed that this funding would not help the "high-liners". The loans will be small and will need to be repaid. Co-Chair Hanley asked for further information regarding the Magnuson-Stevens federal act. MIKE IRWIN, COMMISSIONER, DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS (DCRA), explained that last year was the first time funding had been available from the Magnuson- Stevens Act, which was established to address economic disasters. Section "312" of that act was crafted in 1995 following a crash in the Georgia fisheries. That request was denied. At that time, there had been enough impetus created and people affected, that the federal government agreed that there should be a program to help with those types of economic disasters. Alaska is the first State to have a secretarial declaration under the Magnuson-Stevens provision. On July 18, 1997, Governor Knowles claimed an economic disaster in the Bristol Bay and Kuskokwin areas. Bristol Bay and Kuskokwim seemed to fit the type of situation most appropriate by Section 312 standards of the Magnuson-Stevens Act. The federal government uses certain criteria to determine if there has been an economic disaster. The criteria address income and the amount of dependence that the area has on that source of income. DCRA was able to create a package that was acceptable to the federal government yet met the communities needs. HB 370 is comprised of 70% community block grants for fisheries, economic concerns and development enhancement. The remaining 30% would consist of a no-interest loan program for individuals who live in those communities. Representative Martin voiced concern in how broad the funding language of the legislation was. He noted that he would support helping individual's hardships, but questioned the community block grant aspects of the legislation. Commissioner Irwin explained that the committee substitute contains the amount that was included in the Governor's supplemental request for this funding. He explained that the way the federal government program works is that a certain amount of in-kind be required against the State's match. He agreed that the people of the area who are economically suffering, their needs should be addressed first. He guaranteed Committee members that the loan program would be the first aspect implemented. Commissioner Irwin commented that the people living in the villages have advocated for these projects. The programs match with language in the Magnuson-Stevens Act. This was a way in which the community as a whole could develop some infrastructure and enhancement for future wages. There is $1.86 million dollars set aside for the loan program, providing an economic benefit in the amount of $1 thousand dollars per person. The community works project would not be able to begin until the end of the winter. Co-Chair Hanley asked if there are restrictions within federal law which prohibited DCRA from loaning more than $1 thousand dollars per person. Commissioner Irwin replied that there was not a limit established; these would be "no-interest" loans and the Permanent Fund Dividend (PFD) could be used as collateral. Representative Kelly believed that it would be more advantageous to take the entire amount provided by the federal government and make larger loans available to those living in the village area. He suggested that the public works project probably would not work in an area where the resident's fish as fishing is what they do and generally they are not interested in other job markets. Commissioner Irwin understood Representative Kelly's concern. He emphasized that the people living in these regions initially did not want the loan program. U.S. Congress stressed the need to implement the program. He stated that the proposed projects would enhance the community while also meeting the objectives of the Magnuson-Stevens Act. Representative Kelly reiterated that if it was the intent to help people during this economic need, that should be addressed during the loan process. He stated that the public works projects should be addressed in a competitive process in the Capital Budget. Co-Chair Therriault asked what an "in-kind" contribution from DCRA would consist of. Commissioner Irwin replied that the Department has accumulated a lot of staff time and travel dollars. In response to the fisheries disaster, which began last July, DCRA has spent close to $200 thousand dollars. Those expenses will not be prorated, although, the Department's expectation is that in moving forward, there will be in-kind contributions to help defray the costs. Co-Chair Therriault asked DCRA's program support and general fund dollars attached with it. Commissioner Irwin replied that 2% of the overall program cost would be allocated to the Department for in-kind support expenses. Co-Chair Therriault inquired the length of the loans. Commissioner Irwin replied initially it had been four years but now it might have been changed to two years. He reiterated that borrowers have the option of using their PFD's as collateral. (Tape Change HFC 98- 47, Side 2). In response to Representative Therriault's query, Commissioner Irwin touched on community project possibilities to be undertaken to improve that quality of life in those areas. Representative G. Davis pointed out that the economic disaster was affecting more than just the fishermen, although, the loan was not being offered to any others. Commissioner Irwin stated that there was not enough money to go around. He added that there is a program through the Small Business Association (SBA) for getting small businesses 4% loans available primarily for people involved in the fisheries communities. Co-Chair Hanley asked what would count as a match toward federal funds. Commissioner Irwin stated that the Department of Commerce had accepted DCRA's formula for community and local in-kind matching determined by a federal percentage. Co-Chair Hanley asked if the $3 million dollars for FEMA would be considered a match. Commissioner Irwin advised that it would not. Every state dollar spent has to be matched by three federal dollars. Federal money will be available the week of March 7th. The economic disaster determination was made by the congressional delegation. He commented that a formula had not been used to make that determination. Co-Chair Hanley asked if some of the money could be used too pay the utility providers. Commissioner Irwin replied that the funding could not be used to subsidize fuel sales. The local utilities would need to rely upon people receiving loan money to pay back their utility bills. Co-Chair Hanley inquired if there were non-residents eligible for the loans. Commissioner Irwin advised that they could possibly qualify. It would be based upon permit holding in one of the selected areas. There will be limitations in calculating the percent of the annual household income from the fishery. In order to qualify for the loan program, a person must make 51% or more of their income in that fishery. Representative Martin commented that it appeared most of the funds would be distributed to the Administration rather than going to those in need. Commissioner Irwin responded that administrative costs would amount to 2% of the total funds. Representative Foster asked if assistance would be limited to the list of villages named in the bill. Commissioner Irwin replied that they would be available to the permit holders in the Bristol Bay and Kuskokwin River region. Co- Chair Hanley pointed out that permit holders could get the loans no matter where they live if they meet the criteria. Community grants would be limited to communities listed in the bill. Co-Chair Hanley agreed that the loans were essential, whereas, he felt that the economic development concerns require further discussion in order to be placed on the fast track time-sensitive supplemental. He did not think that diversification of the economy would help the fishermen. Commissioner Irwin pointed out that initially, the U.S. Department of Commerce specified that there would be no direct grants administered. DCRA struggled to convince the feds that the proposed legislation would be a way to get funds into the pockets of the villagers. The proposed community works program would provide the best long term help for the villages. Because the federal government is paying for the bulk of the program, DCRA is forced to opt for these expenditures. To not include these programs which comprise 70% of the proposal, DCRA would have to renegotiate with Congress. He warned such action could slow up the process or even make it "dead in the water". Co-Chair Hanley voiced his frustration with the program and how well it will ultimately affect the people in those areas. Representative Ivan advised that the response team had created the best program possible so to receive the direct grant for the individuals living in the village areas. He urged the Committee's support for the legislation. HB 370 was HELD in Committee for further consideration. (Tape Change HFC 98- 48, Side 1). HOUSE BILL NO. 461 "An Act making supplemental and special appropriations; and providing for an effective date." ANNALEE MCCONNELL, DIRECTOR, OFFICE OF MANAGMENT AND BUDGET, OFFICE OF THE GOVERNOR, provided an overview of the proposed time-sensitive appropriations from the Governor's FY98 Supplemental Bill (HB397, SB292). She assured Committee members that the Administration had placed strict limits on what would be considered time-sensitive. DEPARTMENT OF REVENUE - 1 (a) DAN SPENCER, CHIEF BUDGET ANALYST, OFFICE OF MANAGEMENT AND BUDGET (OMB), OFFICE OF THE GOVERNOR, stated that 1(a) would address the immediate funding for monies needed to prevent cash-flow problems for the Bank of America building. Department of Administration (DOA) has been paying maintenance costs out of their budget as a stopgap measure, however, that budget is experiencing it's own cash flow problems. Private tenants are currently paying AHFC, and OMB would prefer to give AHFC the authority to contract with DOA. The request would address the fiscal note situation resulting from last session. JOHN BITNEY, ALASKA HOUSING FINANCE CORPORATION (AHFC), ANCHORAGE, advised that AHFC at this time has no authority to use the receipts from the building to pay for operation and maintenance costs. AHFC has been collecting the receipts in a separate holding account. With this authority, AHFC would RSA reimbursement to DOA for their expenses. DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS - 1(b) Co-Chair Hanley advised that Section 1(b) had been addressed in HB 370. DEPARTMENT OF CORRECTIONS - 1(c) Mr. Spencer explained that the requested appropriation would be used to cover costs associated with Community Residential Center (CRC) beds. Some CRC contracts will expire March 31, 1998. The Department cannot implement contracts to continue these beds if this requested funding is not made available. Representative Mulder commented that the Department is looking into existing funding that could be applied. DWAYNE PEEPLES, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF CORRECTIONS (DOC), noted that since the supplemental request was submitted, the Department has done a reassessment of the CRC funding BRU's. There is $18 thousand dollars available in a new CRC BRU, which could be available because of start up delays of new beds. Additionally, $64 thousand more dollars has been identified in an existing CRC BRU, money which could also be made available. He noted that to date, the $236 thousand dollar initial request could be reduced by $82 thousand dollars. Mr. Peeples addressed the program receipts. He stated that $50 thousand dollars would come from the Drinking While Intoxicated (DWI) Program. The Department was authorized to receive funds which were above the remaining account balance in that program. Co-Chair Hanley commented that the in-mates occupying the beds would pay for a large portion. DEPARTMENT OF HEALTH AND SOCIAL SERVICES - 1(d) JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, stated that the $100 thousand dollar appropriation request would be used to fund the Maternal Child Care Clinics scheduled to begin in late March. These clinics may be cancelled if a supplemental appropriation allowing use of program receipts from clinic fees is not approved. KAREN PEARSON, HEALTH PROGRAMS MANAGER, DIVISION OF PUBLIC HEALTH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, spoke to the work performed by the specialty clinics. With a professional team traveling out to rural communities allows those families not to have to travel to Anchorage or the lower 48 in order to access medical services. Co-Chair Hanley pointed out that not all people pay for services received at these clinics. He asked if the people, who do pay, cover costs of the clinics. Ms. Clarke understood that the clinics were subsidized through other funding mechanisms. Last year, the Department received funding through Alaska Mental Health Trust Authority as well as federal block grants. She agreed that program receipt revenue does not cover the full cost of the clinics. Co-Chair Hanley questioned why a supplemental request exists when the Department had these clinics included in last year's budget proposal. Ms. Pearson explained that the program staff was not aware during last year's budget that the Division would no longer be able to go to the Legislative Budget and Audit Committee (LBA) for additional program receipts. Representative Foster echoed concern. Ms. Clarke noted that the Department does have some remaining funds resulting from an increase received from the FY99 Mental Health Trust Authority which could continue some clinics. DEPARTMENT OF MILITARY & VETERAN'S AFFAIRS - 1(e) NICO BUS, BUDGET COORDINATOR, DEPARTMENT OF MILITARY & VETERAN'S AFFAIRS (DMVA), stated that the requested funding would coordinate federal receipts for Poker Flats Research Range. The Department will transfer funding to the University of Alaska so that construction can begin this spring. The specific work to be done would happen over a two year time frame, costing about $20 million federal dollars. Those funds would be used for refurbishment of a road and the technology support. He noted that because of existing agreements, it would be easiest for those funds to be distributed through DMVA. The Department would act as funding conduit. Mr. Bus noted that there would be no money for the Department. Representative Martin pointed out that Section 1(e) and 1(i) represented the same money. He asked if the funds would conflict with the Kodiak Space Center. Co-Chair Therriault explained that Poker Flats rockets were atmospheric sounding rockets and which could not achieve orbit; the Kodiak facility rockets will orbit. Representative Martin asked how much money had been spent over the past five years for upgrading. MARY LOU BURTON, (TESTIFIED VIA TELECONFERENCE), UNIVERSITY OF ALASKA, FAIRBANKS, believed that approximately $10 million dollars has been spent since 1990. The project has been 100% federally refunded. DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES - 1(f) Co-Chair Hanley questioned why this item had been included in the fast track supplemental. NANCY SLAGLE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES (DOTPF), stated that this stretch of the road is in great need of repair. It had been included in the State Transportation Improvement Program (STIP) to fix sections of the road during a five years period beginning in 2000. Because of the damages, which occurred this summer, the Department realized they needed to speed up the work. The road has deteriorated. The Federal Highway department has granted approval for this project. The Department is rapidly working to get the proposal completed in order to go to bid by April so that the repairs could be done by August. She pointed out that many states are currently using federal highway money to maintain roads, although it requires each state to provide a plan. Ms. Slagle pointed out that a specific section of road has been identified for repair. The State would not be allowed to undertake general overall maintenance when attempting to meet Federal Highway approval, yet, specific work will be approved. Co-Chair Hanley asked if the State had overappropriated it's original match or if the Department had held off on already approved federal projects. THOMAS BRIGHAM, DIRECTOR, DIVISION OF STATEWIDE PLANNING, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES, replied that neither point had occurred. The Department has increased the size of the FY98 program to general expectation. The Tok project fits into bigger project funding appropriated by the federal government, which would not displace other projects. Co-Chair Hanley inquired the total highway match for this year. Mr. Brigham replied it would be in the amount of $24.5 million dollars. Because of new federal authorization, there could be additional federal funds available. The average match rate is 10%. Co-Chair Therriault asked if the proposed increment would cause a shift to any other proposed project. Mr. Brigham stated that nothing would be displaced and no major design would be needed. DEPARTMENT OF FISH AND GAME - 1(g) KEVIN BROOKS, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF FISH AND GAME, stated that the requested allocation would be used for subsistence harvest research projects. He added, early approval of federal receipts would allow timely completion of these projects. There are five separate small projects included in the request, all of which will need to be completed by September 30, 1998. He added that this would be a 100% federal fund. Representative Foster argued the point that the Nome subsistence position had been cut leaving sixteen positions residing in Anchorage. He indicated his resentment in supporting sixteen subsistence positions in Anchorage when the need is in Bush Alaska. Mr. Brooks responded that the economics of maintaining Bush Alaska offices and leases became prohibitive. Flying from village to village is expensive. The Anchorage office has always been the hub. He summarized that the budget has been cut so small, it is impossible for the Department to cover such a wide area. DEPARTMENT OF LABOR - - 1(h) REBECCA GAMEZ, DIRECTOR, DIVISION OF EMPLOYMENT SERVICES, DEPARTMENT OF LABOR (DOL), explained that the $3 million dollar supplemental request would be used to establish the Alaska Disaster Assistance Program (ADAP). Early approval will allow relief for those persons suffering from the loss of their primary income due to the poor salmon-fishing season in Bristol Bay. Representative Martin asked how the program was different from HB 370. Ms. Gamez explained that this was not a loan program; it was an entitlement program. DOL anticipates quick turnover costs. Administrative costs will amount to approximately 8.4%; $2.75 million dollars will be available to 54 communities in the State. Co-Chair Hanley asked if the Department used guidelines similar to those established by FEMA. Ms. Gamez responded that the determination would be based on a combination of regulations and laws and would include some of those used through FEMA. The federal government turned that request down. An amount had been determined by estimating the maximum number of people that would be eligible under the Disaster Unemployment Assistance program and then used the average unemployment benefit rate received. Representative Martin asked why the program had been limited to Bristol Bay. Ms. Gamez replied that the Division had "stuck" with the basic FEMA request made a number of months ago and did not expand it. Representative Martin suggested adding language specifying all communities that could qualify for the funding. (Tape Change HFC 98- 48, Side 2). Co-Chair Hanley noted that to undertake this request would require additional legislation. Normally there would be a fiscal note attached with the bill. Mr. Spencer questioned where the fiscal note would show up; he recommended the use of conditional language. A fiscal note would provide appropriation contingent upon the bill passing. Appropriation could be made in the bill, but if the bill did not pass, the appropriation would be no good. Co-Chair Hanley noted that there could be an appropriation bill tagging along with the legislation. UNIVERSITY OF ALASKA - 1(i) Co-Chair Hanley noted that Section 1(i) was tied with Section 1(e). DEPARTMENT OF MILITARY & VETERAN'S AFFAIRS - 1(j) Mr. Bus explained that the appropriation would fund the Youth Corps ChalleNGe program. He stated that early approval was needed to begin the next scheduled class on March 16, 1998. He advised that $250 thousand dollars had been allocated in the FY98 budget to support the program with the understanding that the Department could come back during the supplemental budget process. The Department did not know what the federal funding commitment would be. The initial allocation for Alaska was about $2 million dollars. DMVA continues to run the program in anticipation of 80 graduates per class in each of the two classes. In order to get the program back up to par; the Department is proposing supplemental funding request in the amount of $608 thousand dollars to secure the program through June, 1998. Co-Chair Hanley asked the total anticipated budget for the year. Mr. Bus replied that it would be $3.4 million dollars, consisting of State and federal funding. The federal government has committed to $2.1 million dollars. Co-Chair Hanley asked the amount of the request if there were 60 graduates. Mr. Bus explained that becomes complicated as the federal guidelines require 75% federal funds for 25% State funding match requirements. Co-Chair Hanley requested an impact statement indicating the cost differential for 60 and/or 80 graduates. He pointed out that the percentage provided by the feds is declining. Representative Foster pointed out that when the program started it was a total federally funded program, however, at this time, the projection is that federal funding will pay 60% of costs and the State will provide 40% of the associated costs. Representative Foster pointed out that the cost per graduated student is approximately $22 thousand dollars. Mr. Bus advised that the program was geared to the "at-risk" youth and that it is a cost avoidance program. The cost of sending a youth to a correctional facility is approximately $66 thousand dollars. Mr. Bus emphasized that at-risk youth really benefit from the program. DEPARTMENT OF ADMINISTRATION - 1(k) Mr. Spencer noted that the Department of Administration (DOA) was requesting funding for needed monthly lease payments for the period from now through May, 1998. SHARON BARTON, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF ADMINISTRATION, advised that when the FY98 budget had been passed, DOA projected that budget would be short approximately $1.7 million dollars. The net effect of activity since that time has resulted in a total request of $1.4 million dollars. HB 461 was HELD in Committee for further consideration. Co-Chair Hanley asked for further clarification regarding a potential supplemental request resulting from the decision made by Judge Hunt to the Department of Corrections regarding the overcrowding situation. DEAN GUANELI, CHIEF ASSISTANT ATTORNEY GENERAL, CRIMINAL DIVISION, DEPARTMENT OF LAW, provided Committee members a history of the Cleary case which was filed in 1981 and which challenged all aspects of the State's prison system. There was a six-week trial of that case in 1984. After the trial, the Anchorage Superior Court determined that system was in danger of becoming unconstitutionally overcrowded. The Superior Court established population limits at all the facilities. Through negotiations, the Department was able to get increases to those limits set. Mr. Guaneli stressed that those population limits have now been seriously exceeded. The Superior Court has held the State in contempt for the last three years, accruing fines at the rate of $100 thousand dollars a month. He advised that the Court has become frustrated with the Department's inability to get the population under control. The Court has appointed a new Court Master to pressure the Department to create a plan which will work. The most recent order by the Court, made in early February, has required that by March 9th, the Department of Corrections provide a plan that will reduce numbers in the facilities by May 1st. Mr. Guaneli warned that if the Department is unable to do that, the Court has options available. Courts in other states have released prisoners, some Courts have taken over running the prison systems, and some have removed funds from the State Treasury to run the system. Mr. Guaneli emphasized that this issue needs to be taken seriously. There are 500 hundred prisoners who need to be addressed in order for the State to be down to an emergency capacity. Co-Chair Hanley advised that the State should anticipate additional costs this fiscal year. ADJOURNMENT The meeting adjourned at 4:25 P.M. H.F.C. 16 3/02/98