HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE April 20, 1995 2:08 p.m. MEMBERS PRESENT Representative Cynthia Toohey, Co-Chair Representative Con Bunde, Co-Chair Representative Al Vezey Representative Gary Davis Representative Norman Rokeberg Representative Caren Robinson Representative Tom Brice MEMBERS ABSENT None COMMITTEE CALENDAR * HB 280: "An Act establishing the Alaska Human Resource Investment Council and transferring certain functions of other entities to the council; establishing a planning mechanism for employment training and other human resource investment needs; and providing for an effective date." HEARD AND HELD * HB 309: "An Act approving the University of Alaska's plans to enter into long-term obligations to borrow money from the Alaska Housing Finance Corporation for the acquisition of student housing facilities; and providing for an effective date." PASSED OUT OF COMMITTEE * HCR 18: Endorsing a proposal by which the Alaska Housing Finance Corporation, under provisions of law by which the corporation may exercise its powers to complete moderate income and rental housing, will make interest-subsidized loans for the construction of student housing facilities at certain campuses of the University of Alaska, and relating to an agreement between the parties respecting the initiation of student housing on certain campuses of the University of Alaska. PASSED OUT OF COMMITTEE CONFIRMATION HEARINGS - University of Alaska Board of Regents. * HB 229: "An Act prohibiting certain amplified sounds from automobiles; and providing for an effective date." PASSED OUT OF COMMITTEE (* First public hearing) WITNESS REGISTER BOB RUBADEAU, Special Assistant to the Lieutenant Governor Lieutenant Governor's Office State Capitol, 3rd Floor Juneau, AK 99801 Telephone: (907) 465-3520 POSITION STATEMENT: Provided sponsor statement for HB 280. JANICE TATLOW, Council Member Private Industry Council P.O. Box 1621 Palmer, AK 99645 Telephone: (907) 745-4488 POSITION STATEMENT: Testified in support of HB 280. DEBRA CALL, Chairwoman Alaska Job Training Council P.O. Box 93330 Anchorage, AK 99509 Telephone: (907) 561-3200 POSITION STATEMENT: Testified in support of HB 280. SARAH SCANLON, Former Chair Alaska Job Training Council 1001 E. Benson Blvd. Anchorage, AK 99508 Telephone: (907) 265-4100 POSITION STATEMENT: Testified in support of HB 280. JERRY LEWIS, Executive Director Governor's Council on Vocational Education 211 Fourth Street, Suite 101 Juneau, AK 99801 Telephone: (907) 586-1736 POSITION STATEMENT: Testified in support of HB 280. REBECCA NANCE, Director Employment Security Division Department of Labor P.O. Box 25509 Juneau, AK 99802-1149 Telephone: (907) 465-2711 POSITION STATEMENT: Testified in support of HB 280. JACK SHAY P.O. Box 3159 Ketchikan, AK 99901 Telephone: (907) 225-7429 POSITION STATEMENT: Testified in support of HB 280. TOM ANDERSON, Legislative Assistant Representative Terry Martin's Office Alaska State Legislature State Capitol, Room 502 Juneau, AK 99801 Telephone: (907) 465-3783 POSITION STATEMENT: Provided the sponsor statement for HB 309. WENDY REDMAN, Vice President Statewide University System University of Alaska P.O. Box 155000 Fairbanks, AK 99775 Telephone: (907) 474-7311 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. MARSHALL LIND, Chancellor University of Alaska Southeast 11120 Glacier Highway Juneau, AK 99801 Telephone: (907) 465-6472 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. LEE GORSUCH, Chancellor University of Alaska Anchorage 3211 Providence Drive Anchorage, AK 99503 Telephone: (907) 786-1437 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. BILL HOWE, Deputy Commissioner of Revenue Treasury Division P.O. Box 110405 Juneau, AK 99811-0405 Telephone: (907) 465-4880 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. JACK DALTON, President Union of Students University of Alaska Anchorage 3211 Providence Drive Anchorage, AK 99508 Telephone: (907) 786-1207 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. HEATH HILYARD, Legislative Affairs Director Associated Students University of Alaska Fairbanks c/o Wood Center Fairbanks, AK 99775 Telephone: (907) 474-6036 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. CHRISTINA BROLLINI, Senator Union of Students University of Alaska Anchorage 1833 N. Western Anchorage, AK 99508 Telephone: (907) 786-1205 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. DAVID WALKER, Chairman, Rules Committee, Union of Students University of Alaska Anchorage 4231 Laurel Street, Apt. 304 Anchorage, AK 99508 Telephone: (907) 786-1960 POSITION STATEMENT: Testified in support of HB 309 and HCR 18. CHANCY CROFT, Attorney 441 W. 5th Avenue, Suite 400 Anchorage, AK 99501 Telephone: (907) 272-3508 POSITION STATEMENT: Testified as a candidate for the University of Alaska Board of Regents. JOE J. THOMAS, Business manager/Secretary Treasurer Laborers' Local 942 315 Barnette Street Fairbanks, AK 99701 Telephone: (907) 452-3139 POSITION STATEMENT: Testified as a candidate for the University of Alaska Board of Regents. SHIRLEY ARMSTRONG, Legislative Assistant Representative Rokeberg's Office Alaska State Legislature State Capitol, Room 110 Juneau, AK 99801 Telephone: (907) 465-4968 POSITION STATEMENT: Testified in support of HB 229. PREVIOUS ACTION  BILL: HB 280 SHORT TITLE: HUMAN RESOURCE INVESTMENT COUNCIL SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR JRN-DATE JRN-PG ACTION 03/24/95 896 (H) READ THE FIRST TIME - REFERRAL(S) 03/24/95 896 (H) HES, FINANCE 03/24/95 896 (H) FISCAL NOTE (GOV) 03/24/95 896 (H) 4 ZERO FNS (DCED, DCRA, DOE, DHSS) 03/24/95 897 (H) 2 ZERO FNS (LABOR, UA) 03/24/95 897 (H) GOVERNOR'S TRANSMITTAL LETTER 03/24/95 899 (H) SECTIONAL ANALYSIS 04/20/95 (H) HES AT 02:00 PM CAPITOL 106  BILL: HB 309 SHORT TITLE: APPROVE U OF A DEBT FOR STUDENT HOUSING SPONSOR(S): REPRESENTATIVE(S) MARTIN JRN-DATE JRN-PG ACTION 04/13/95 1318 (H) READ THE FIRST TIME - REFERRAL(S) 04/13/95 1319 (H) HES, FINANCE 04/20/95 (H) HES AT 02:00 PM CAPITOL 106  BILL: HCR 18 SHORT TITLE: UNIVERSITY OF ALASKA STUDENT HOUSING SPONSOR(S): REPRESENTATIVE(S) MARTIN JRN-DATE JRN-PG ACTION 04/13/95 1318 (H) READ THE FIRST TIME - REFERRAL(S) 04/13/95 1318 (H) HES, FINANCE 04/20/95 (H) HES AT 02:00 PM CAPITOL 106  BILL: HB 229 SHORT TITLE: PROHIBIT LOUD VEHICLE SOUND SYSTEMS SPONSOR(S): REPRESENTATIVE(S) ROKEBERG,Toohey,Bunde JRN-DATE JRN-PG ACTION 03/03/95 565 (H) READ THE FIRST TIME - REFERRAL(S) 03/03/95 566 (H) STATE AFFAIRS, HES, JUDICIARY 04/05/95 1039 (H) STA REFERRAL WAIVED 04/13/95 (H) HES AT 02:00 PM CAPITOL 106 04/13/95 (H) MINUTE(HES) 04/20/95 (H) HES AT 02:00 PM CAPITOL 106 ACTION NARRATIVE TAPE 95-39, SIDE A Number 000 CO-CHAIR CON BUNDE called the meeting of the House Health, Education and Social Services standing committee to order at 2:08 p.m. Present at the call to order were Representatives Bunde, Toohey, Rokeberg, and Davis. A quorum was present to conduct business. Co-Chair Bunde read the calendar and announced the order of the bills. Representative Brice joined the meeting. HB 280 - HUMAN RESOURCE INVESTMENT COUNCIL Number 095 BOB RUBADEAU, Special Assistant to the Lieutenant Governor, said Representative Phillips began this initiative to allow Alaska to incorporate all of its federally mandated supervisory policy committees that oversee federal funding for many of the vocational job skill development and vocational education opportunities in the state. MR. RUBADEAU said these committees have the opportunity under a recently passed federal statute to consolidate into one oversight committee to help states plan for many of the coming funding opportunities. These committees will also have the opportunity to respond to the block grant scenario in a more consolidated way. Number 194 MR. RUBADEAU said HB 280 basically takes the Alaska Job Training Council, the Governor's Council on Vocational Education, and the Employment Security Advisory Council, and incorporates them into one body. Membership that is presently at 38 will be taken down to a minimum of 21 and a maximum of 26 members. The efficiency and economy of scale the Human Resources Investment Council (HRIC) hopes to accomplish by doing this will also provide some initial savings. MR. RUBADEAU said the opportunity for more cohesive and effective planning for all the vocational education and job training skills presents itself for the entire Alaska workforce in the coming decades. Number 261 MR. RUBADEAU said 21 states presently have taken advantage of this option under federal law. HB 280 was created after a study of all the different existing programs for all the HRICs. The drafters of the bill looked at many of the provisions in HB 280, hoping to raise the debate about policy and decision making for vocational education and job skill training. The drafters hope to place that debate into the Governor's office. MR. RUBADEAU offered to go through a sectional analysis of the bill. Section 1 of the bill basically sets out the legislative findings, and looks at the many job training and vocational education programs that exist within Alaska's workforce. It is estimated that there are approximately 16 different groups that may apply in the future for consolidation under the Alaska HRIC concept. MR. RUBADEAU continued that Section 2 directs the Board of Education to consider the advice of the HRIC in the development of their vocational education programs. Initially, it is a given that all education leads toward jobs and job skill development. Number 362 MR. RUBADEAU said Section 3 makes a member of HRIC a member of the Alaska Commission on Postsecondary Education. Within the bill, the Postsecondary Education is rescinded underneath HB 280. Section 4 includes HRIC as a state board or commission, whose membership is also subject to conflict of interest reporting requirements under AS 39.50. MR. RUBADEAU said Section 5 establishes the HRIC in the office of the Governor. This is very important. The bill that dealt with the HRIC that was previously passed through the House and the Senate last year, and was vetoed by Governor Hickel, did not have this provision. The drafters of the bill felt this was an important component as all of the different agencies in the bodies that are proposed for consolidation under this act are dealt with. Number 390 MR. RUBADEAU said Section 5 establishes the HRIC as the state planning and coordinating entity for certain state programs that are administered under a number of different federal provisions. This will allow the HRIC to anticipate and respond to whatever funding scenario is passed down through federal legislation. Mr. Rubadeau felt the council should be prepared for anything. MR. RUBADEAU summarized Sections 6 through 15, noting that they provide the statutory and session law changes for consistency with the shift of responsibilities to the HRIC, including the deletions of references to the Job Training Council and the other councils that are presently under state statute. MR. RUBADEAU felt the provision set out in Section 16 was also a very important part of HB 280. When Mr. Rubadeau began studying the different agencies involved and the different boards and commissions that were suggested for consolidation, he wanted to be sure that each of those had ownership and understanding of what was envisioned in the bill. Number 496 MR. RUBADEAU said because of the arcane requirements for the federal funding programs (such as Job Training and the Carl Perkins Grants), the sponsors of the bill needed to effectively make sure they were maximizing the state's revenue from the federal level by not missing any of the opportunities under the existing law. In addition, as the sponsors began to plan a coordinated effort for planning on the state level to make Alaska's plan unique to meet Alaska's needs, they kept in mind a sunset provision. This provision would basically give the councils an opportunity to plan their own consolidation efforts to give the sponsors some understanding of how their missions and funding requirements would be met. MR. RUBADEAU said the sponsor's office asked the councils to propose their own terms of consolidation over 18 months. Number 550 MR. RUBADEAU hoped that after the creation of the HRIC on July 1, 1995, the HRIC will be fully in place and empowered with the different missions of the consolidated boards and commissions by July 1, 1996. MR. RUBADEAU continued that Sections 18 and 19 address the specific federal requirements for reporting from the private industry councils and the other existing regional development councils. Those councils have been very effective in relaying the needs of the Alaska work force to the state legislature, and to the oversight and representative committees. MR. RUBADEAU noted that one of the most important aspects of this bill is that the bill has brought together the needs and desires of the agencies to fulfill their requirements on job skills and vocational education on the part of the Alaska work force. The bill's sponsors have explained the provisions to the different councils and commissions. Recently there was a joint meeting of all the commissions and boards that are proposed to be consolidated. Each of the commissions and boards have supported this concept, and are present at the HESS Committee meeting to testify to that fact. Number 1687 CO-CHAIR BUNDE agreed that HB 280 is a major piece of legislation, and input from representatives of the involved boards and commissions would be greatly appreciated. Number 734 JANICE TATLOW, Council Member, Private Industry Council, serving the Anchorage, Mat-Su area, testified via teleconference that she is pleased with the efforts that have been made toward the development of the HRIC. There is also a great effort going on in Alaska to see if there can be three pilot projects in the nature of career development centers that would improve service to Alaska. MS. TATLOW said it is her understanding that each career development center will be based throughout the state. Ms. Tatlow was concerned that the way the HRIC seats are configured may lack a link with the local communities and the local people. Job training is very effective in local communities, and Ms. Tatlow suggested a provision be made. MS. TATLOW stated lines 9 and 10, Section 5, says there would be four representatives from business and industry. She asked if the statement could be amended to include "...with at least two representatives from a private industry council, representing private sector business." Number 840 MS. TATLOW also suggested a change on line 22 of that section. line 22, she said, reads of "at least one, and up to four additional members of the private sector to insure a private sector majority in regional and local representation on the council." Ms. Tatlow asked if the phrase, "...with at least one member from the Private Industry Council, representing private sector business" could be added. MS. TATLOW also noted that HB 280 provides for a nonvoting member of the HRIC. In order to keep the links strong in each local area to insure continuity and stability in services and employment training programs, perhaps membership could be considered in the nonvoting segment for the three service delivery area managers. These are the people that have worked on all ends of the employment and training segment. These people work with the Governor's office, the local staff, and the patrons of the training. MS. TATLOW said these people, over the years, have developed a lot of expertise and professionalism. They know what will and won't work. Ms. Tatlow thinks Alaska is entering a time of great change. Career development centers are being investigated, Congress is considering block grants, and Alaska is considering the HRIC. These are very positive moves for the future. Anyone Ms. Tatlow has spoken with has well-received these ideas. However, Ms. Tatlow wants to be sure the state has a strong link to the local people who will be served. Number 970 CO-CHAIR CYNTHIA TOOHEY had been looking over the list of proposed HRIC members. She felt there was a wide representation from private sector businesses. That representation is covered better than any other sector. MS. TATLOW agreed. However, she was concerned that people who have been involved with employment and training programs, and have worked many years with the Private Industry Council, will not be included. Many of the council members are private sector business people. Ms. Tatlow would not like to see that talent and knowledge wasted. She felt to ignore their experience would be like reinventing the wheel. If their inclusion in the bill was expressed, their experience would help maintain the continuity of employment training. CO-CHAIR TOOHEY appreciated Ms. Tatlow's testimony. However, she asked Ms. Tatlow to look at line 24, page 4 of the bill. It speaks of additional nonvoting members. Co-Chair Toohey told Ms. Tatlow that if and when this bill passes, and the HRIC is comprised, that is the provision that can provide the balance Ms. Tatlow seeks. CO-CHAIR TOOHEY felt, however, that the Governor's office will certainly take Ms. Tatlow's testimony into consideration. CO-CHAIR BUNDE announced the arrival of Representative Robinson at 2:10 p.m. Number 1099 DEBRA CALL, Chairwoman, Alaska Job Training Council, said before she speaks, she would like to ask the previous chair of the Job Training Council (JTC) to provide HESS Committee members with a brief history of how this legislation developed. Then Ms. Call said she would provide a briefing on the current national status of legislation such as this. SARAH SCANLON, Vice-president of Human Resources, Northwestern Alaska Native Association (NANA); former Chairwoman, Alaska JTC; said she represents the private sector. The issue of consolidating the human resource initiatives has been ongoing for more than ten years. As some are aware, there have been attempts in the past to push policy through. Unfortunately, efforts have failed up to this point. MS. SCANLON understood the last bill was vetoed by Governor Hickel for reasons of state agency interference. She hoped that will not happen with this bill. Number 1195 MS. SCANLON said there is a need to consolidate the many human resource investment programs, and there are many reasons to do so. The rural economies demand that these changes move the state toward a quality work force. In the private sector, fragmented systems that make it difficult to find decent employees to fill the many jobs that are available cannot be tolerated. The lack of a connecting education system and the lack of communication between state and federal programs are great problems. MS. SCANLON said the creation of the HRIC provides the opportunity to solve those problems. In addition, the consolidation of the many councils is going to eliminate all the waste that is occurring in the multiple council staff configurations. The travel alone for a group of different people doing the same things is unnecessary. Ms. Scanlon fully supports what the bill attempts to do in eliminating the waste that is occurring. Number 1287 MS. SCANLON said this is one of those bills that makes sense to the private sector and to the state employees. Everyone wants to do a better job, and it will force people to communicate with each other more and work more closely together. MS. SCANLON stated it was important to have a system driven by the customer's needs. For too long, the system has paid too much attention to what the state workers want to do and what the federal requirements are. Not enough attention has been given to the customer and the end product. Therefore, the HRIC is beyond its time. Ms. Scanlon expressed her organization's support for the bill, and asked HESS Committee members to support it also. Number 1308 MS. CALL offered to bring HESS Committee members up to date on these issues. She said she currently serves as the chair of the JTC, and she also serves as a member of the national JTC. The national group has been meeting on a semi-annual basis to track what is going on in Congress. Currently, there are five bills in Congress that propose to consolidate employment training programs on the federal level. What that means, and as Ms. Scanlon explained, is that block grants may be received at some point. That is being anticipated. MS. CALL said a block grant to the state of Alaska will be setting the priorities on employment and training programs. Issues such as where those monies will go and what issues are going to be addressed will be taken into consideration. It looks very promising that Congress will pass one of the bills. She expects consolidation bills to pass in both the federal House and Senate. The House bill proposes block grants for each state, covering populations in need of employment training. Number 1363 MS. CALL understood that Senator Stevens is very much in support of the efforts on HB 280. He feels that nationally, the consolidation is an issue being discussed. Number 1406 JERRY LEWIS, Executive Director, Governor's Council on Vocational Education (GCOVE), said GCOVE just completed, on March 31, a biennial report that dealt with the coordination of the Job Training Partnership Act (JTPA), its delivery system, and the Vocational Education delivery system. Out of that biennial report, the following recommendation was made. GCOVE is committed to helping promote vocational education and JTPA coordination in the state of Alaska. MR. LEWIS said after reviewing the JTPA delivery system and its coordination with vocational education programs along with current national trends, GCOVE recognizes the necessity of the formation of an HRIC. The specific provision of the JTPA amendments that most significantly affect the cooperation with vocational education and other systems concerns the HRIC, which the JTPA amendments empower the Governor to establish as a means of coordinating and integrating JTPA, vocational education, and other systems of Human Resources Development. Number 1414 MR. LEWIS continued that HB 280 facilitates this integration, and the GCOVE concurs with its premise. The expected benefit of this recommendation is the development of a statewide system that will serve all Alaskans more efficiently. Additionally, in order to accommodate the comprehensive system, the GCOVE would recommend that the School-to-Work Transition Council be included under the umbrella of the HRIC. MR. LEWIS said to neglect this would be to fall short of the complete consolidation necessary to avoid fragmentation of programs, resources, and the possibility of duplicated services. One of the members of GCOVE, David Stone, could not be present at the hearing although he wanted to be. He asked Mr. Lewis to apologize for his absence and express his support for the HRIC. Number 1511 CO-CHAIR TOOHEY asked if Mr. Lewis was requesting a specific space on the HRIC for a School-to-Work Transition Council member. MR. LEWIS answered that he was asking that School-to-Work be included in the list of representatives. CO-CHAIR TOOHEY agreed that was critical. REPRESENTATIVE GARY DAVIS noted that one of the first callers on teleconference requested a "slot" be made for Private Industry Councils. On page 4, line 10, it indicates "four representatives from business and industry, with at least one representative from the private industry councils appointed under 29. U.S.C. 1512." Representative Davis asked how those federal statutes relate to the Private Industry Council that is currently in place. MR. LEWIS answered that the job training partnership amendments of 1992 are the ones that allow the creation of the HRIC. They specifically had a percentage of the representatives on the council. A percentage has to be from the private sector, a percentage has to be union, a percentage must be included from the public sector. The membership numbers that were arrived at for the HRIC, the 21 to 26, was to fit that formula. Number 1566 MR. LEWIS said GCOVE is required under the Carl D. Perkins Act, which is up for reauthorization right now. The Administration's bill has been submitted by Senator Kennedy and Representative Clay, and a committee is working on the committee's bill. That is going to change the Carl D. Perkins Act considerably. The Administration's bill in itself eliminates Section 112, which requires that there be a state council on vocational education. With the elimination of that council, something will have to be in place within the state to handle the predicted block grants. MR. LEWIS said no one knows if the state is going to receive one block grant, or four. That depends on which bill in Congress passes through. Having an HRIC in place when the legislation is passed will help Alaska be ahead of the game. Number 1621 REPRESENTATIVE DAVIS asked to follow up on those comments. He asked if the current private industry council that is currently in place was formed under the U.S. Code referred to in the bill. MR. LEWIS noted there is more than one private industry council in the state. The statewide private industry council, of which David Stone is the Juneau Chair, just completed its last meeting yesterday. That council is under the authorization of that U.S. Code. Number 1661 REBECCA NANCE, Director, Employment Security Division, Department of Labor, said the Alaska Department of Labor (DOL) is in support of the Alaska HRIC legislation for a variety of reasons. Alaskans are the most important resource available in the state. The HRIC is good public policy because the bill provides for the coordination and consolidation advocated by the public for more efficient and effective government. MS. NANCE also believed it was good for the DOL because it will help it realize its mission of promoting the wage-earner of Alaska and assuring that Alaskans will obtain the training they need in order to be competitive for the available jobs. Therefore, the need to rely on the nonresident work force will be reduced. MS. NANCE stated the DOL is in support of this legislation as a partner to the jobs program. This bill will strengthen the ability of the DOL to get welfare recipients back to work. It will provide a little more flexibility in terms of systems delivery. MS. NANCE concluded by saying that when the time comes for the creation and implementation of this legislation and the HRIC in Alaska, the DOL will be poised and ready to receive the federal block grants that seem imminent for employment and training programs. Number 1739 JACK SHAY represented himself at the hearing. He said he is a former member of the JTC and the private industry councils, serving under four different governors. He is also a former director of the Employment Security Division. He has been involved in training programs and private industry councils for quite some time. He mildly disagreed with Janice Tatlow about a concern that perhaps there would not be enough private industry involvement in this council. MR. SHAY was virtually sure there will be plenty of involvement. It is designed into the law, and it is part of the JTPA. In addition, Ms. Scanlon noted that this legislation has been in progress for quite some time. Mr. Shay is currently retired, but he is still interested in this arena because he agrees very strongly that the people are Alaska's greatest resource. Number 1776 MR. SHAY said the federal government came up with the enabling legislation for this type of provision. As a matter of fact, the federal legislation was actually encouraging states to consolidate these bodies, focus more on the problems at hand, avoid duplication efforts, and generally coordinate all the provisions of employment and training. MR. SHAY felt this legislation is a good idea. There might be one possible amendment the HESS Committee members might like to consider, however. The way the council is currently designed, there will be 23 to 26 members. That seems to be rather unwieldy. Mr. Shay has served on bodies containing that many members. If there was some good way of perhaps reducing the number (and Mr. Shay did not have any cogent suggestions at the time), he would urge HESS Committee members to look into it. MR. SHAY noted that the JTPA does require a certain percentage of persons on the board. In fact, it requires a majority of the private industry. Other than that, drawing on his many years in this field, Mr. Shay felt this legislation was splendid, and he urged its passage. Number 1828 REPRESENTATIVE CAREN ROBINSON asked where the recipients of these services fit in on the board. She asked Mr. Shay what he thought. MR. SHAY said that was an excellent question. He said he was involved in the design of policy, and not in the design of actual delivery and procedures. He deferred the question to perhaps someone from the Governor's office. However, he said the bottom line is training individuals for jobs that exist in the labor market. CO-CHAIR BUNDE asked Mr. Rubadeau to speak to the fiscal note. He also asked if Mr. Rubadeau had a grasp on what the state could expect to save from consolidation. Co-Chair Bunde understood that an efficient operation may mean better service, but he was concerned about funding. Number 1897 MR. RUBADEAU agreed everything boils down to dollars and cents. The state, however, needs to focus on more of the "sense" part of this legislation. By efficiency of scale, by dropping from 38 members to 23 to 26 members, there will be a slight economy of meeting. There will not be duplication of effort. The state is looking at doing a lot of the initial work in subcommittees (there will be standing subcommittees of this group) which will report on specific parts and portions of the job training in vocational education aspects around the state. Number 1924 MR. RUBADEAU said the dollars reflected in the fiscal note are all interagency transfers. These are dollars that are already identified by the enabling legislation to coordinate the planning, to perform responsible oversight, and to look at how to more efficiently deliver the product. MR. RUBADEAU said as his office studied the issue, and they identified nine PCNs that have been formally allocated over ten years through different scenarios to the ongoing policy development under the federal guidelines. Presently, there are three PCNs that are servicing these three councils, as well as a lot of in-kind donations from the agencies under which these councils exist. The bill's sponsors are seeking to consolidate those three PCNs into one, and adding a higher-level staff person. That person would not be at a higher level than those that exist currently, but would be a staff person in the Governor's office who will bring the private industry's concerns to a higher policy level of debate on a daily basis. MR. RUBADEAU said by the consolidation effort, it is hoped the efficiency of delivery will be realized. In addition, the private industry employers and employees are the customers of the HRIC. The efficiency in planning, the long-term policy and strategic development that could be envisioned under the HRIC idea will be the savings, but in the long run, there will not be significant savings from a fiscal standpoint. Number 2005 CO-CHAIR BUNDE asked Mr. Rubadeau to address the concerns of Mr. Shay regarding the large membership of the proposed council. MR. RUBADEAU said he has operated with many large-sized groups. As the sponsor's office studied federal legislation, the group membership was pared down as closely as possible. However, the requirements of the enabling federal laws had to be met. It is imperative that resources from the federal government be maximized. There must be no opportunity for any federal programs to tell the state it did not meet requirements. The federal program could then audit the state, and the state could lose funding. MR. RUBADEAU said as different scenarios were investigated, 21 was the minimum membership. Everyone needed to come to the table with a private sector majority. That is what bumped the membership up to 23 members. The line agency commissioners had to be involved, and there also had to be a private sector majority. That is how the membership rested at 23. Many of the day-to-day working aspects of the HRIC will be handled in subcommittees that are specifically targeted for the Carl Perkins Grant and the oversight of the UI trust fund. MR. RUBADEAU said those grants and funds will be handled and reported back to the general council. Therefore, the sponsors envision that much of the work will be done in the subcommittee and brought back. Number 2063 CO-CHAIR TOOHEY read page 4, line 4 of the bill: "or each respective commissioner's designee." She asked if there was anything that precludes the other members from having their own representatives if he/she cannot make the meeting. Co-Chair Toohey was concerned about the legality. MR. RUBADEAU said it is not specifically pointed out in the legislation. However, he feels there also will be bylaws developed by the HRIC once it is developed. Those laws will most certainly address those issues. If a quorum is hard to come by, there will be some sort of enabling working document that will allow work to get done. Number 2100 REPRESENTATIVE DAVIS noted that Mr. Rubadeau had mentioned sunset dates for the existing councils that will be incorporated into the HRIC. Representative Davis thought the size of the proposed HRIC will be closely scrutinized. What the state will need is some verification that the federal law is really driving this size. REPRESENTATIVE DAVIS can foresee many people trying to whittle the group down. If the group is not going to work whittled down, then people must be shown documentation as to why the group size should be left alone. In addition, federal legislation is currently in the works. It has not yet passed, therefore there may be changes in those laws as they progress as to how large the council may be required to be. REPRESENTATIVE DAVIS was thinking, therefore, of a possible sunset clause on the HRIC so it will be revisited by statute, as opposed to needing a bill to go through the process to even get the review before the legislature. Representative Davis asked if a sunset date has been discussed, and how a proposed sunset date would be received. Number 2145 MR. RUBADEAU felt Representative Davis brought up a very good point. The situation at the federal level is very fluid at the present. Therefore, HB 280 seeks to operate under the best case scenario. The sponsor's office feels there will always be federal monies coming to states to help with job training and vocational education components of a state plan. MR. RUBADEAU envisions this council to meet the present federal requirements at the minimum. He hopes the federal laws will not change so drastically. There always will have to be some body present to accept the federal funds, and some body to disperse the funds. If the membership is studied closely, the following line agencies need to be identified: Agencies such as the Department of Education, the Department of Labor, and the Department of Community and Regional Affairs. Number 2181 MR. RUBADEAU stressed that it is very important that those agencies be at the table. In addition, labor needs to be at the table. The private sector needs to have the majority. There needs to be some sort of Alaskan Native component. If one person could be identified which was not necessary to the legislation, Mr. Rubadeau assured HESS Committee members that person would not be included. MR. RUBADEAU said the sponsor's office would have loved to present a 12-member board. However, it could not be done legally. If the board could pare down to narrow its focus, it may well envision itself doing so. However, to envision that the state of Alaska can get by with regional representation, cultural sensitivity, governmental, and nongovernmental entities as well as a private sector majority, Mr. Rubadeau doubts the council can get by with less. Number 2245 REPRESENTATIVE ROBINSON asked if Mr. Rubadeau envisioned the one, consolidated position of which he previously spoke would be in Juneau, Fairbanks or Anchorage. MR. RUBADEAU said the sponsor's office feels very strongly that with the sunset provisions in the bill, it does not want to anticipate the council's wishes. Sarah Scanlon testified that this legislation has been in development for ten years. Mr. Rubadeau does not want to prejudge what the council would plan to be the most effective delivery system for vocational education and job training. MR. RUBADEAU continued that three councils are proposed, and the fourth, School-to-Work, is of course a natural member. They are all on parallel lines right now. It is envisioned that, once this enabling legislation allows those groups to look at a sunset provision, they converge on their own and with their own plans. It is anticipated they will work together to develop a staffing pattern with a regional representation on the HRIC. That would indicate what those groups felt was the most effective use of the available dollars. The sponsor's office therefore did not prejudge where the position would be placed at the moment. Number 2300 CO-CHAIR BUNDE closed public testimony. As this was the first time this bill was heard, it was the inclination of Co-Chair Bunde to hold the bill. Co-Chair Bunde asked for the wish of the committee. REPRESENTATIVE TOM BRICE expressed a willingness to move the bill from committee. TAPE 95-39, SIDE B Number 000 REPRESENTATIVE NORMAN ROKEBERG was concerned about the membership of the HRIC. He had previously thought the bill would be referred to a subcommittee, where his concerns could be addressed. Number 035 MS. CALL spoke via teleconference in response to Representative Rokeberg's concerns about council size. She said HB 280 will take the three councils, which now consist of 40 members, and which are now doing employment and training in the state of Alaska, and reduce that number down to 23. If representatives are concerned about size and cost, the first step would be to downsize to 23 members. MS. CALL said the second item is that the consolidation is taking place under the 1992 JTPA amendment. No matter what happens in Congress, this legislation is still valid. HB 280 provides the flexibility needed to address the employment training issues in the state. Therefore, HB 280 correctly addresses what can be done, and in the long run it will be more effective and efficient for Alaskans. MS. CALL reiterated that Alaskans are Alaska's most important resource, and the HRIC should be a priority. When the state speaks about mining, oil and timber, it certainly does not mind developing those resources and spending the money to do so. However, that type of development is not discussed in relation to the Alaskan people. Therefore, Ms. Call encouraged HESS Committee members to support HB 280, and move it through the legislature this year. Number 165 CO-CHAIR TOOHEY asked how many meetings Mr. Rubadeau envisioned the council having each year. MR. RUBADEAU answered that the three councils now meet at least quarterly. Currently, GCOVE meets quarterly also. Therefore, there are a total of 12 meetings per year. Those 12 meetings will probably shrink to 4 consolidated meetings. CO-CHAIR BUNDE pointed out that the HESS Committee members had quite a bit more work to do. He again asked the wish of the committee on whether to hold the bill or not. Number 229 REPRESENTATIVE DAVIS did not have a preference either way. However, if the bill was going to be moved, he had a few questions. On page 4, line 6, it says the council will be made up of four additional representatives of education. One will be from local public education, one from secondary vocational education.... Representative Davis did not see a distinguishing factor between those two members, as opposed to basic education in the public schools. Of course, the public schools do have vocational education. The bill separates those two things in public education. MR. RUBADEAU agreed. He said that if Representative Davis could be procured as an advocate for school-to-work, it would be desirable to erase those barriers. All education leads toward work, and that differentiation should be eliminated in any statute. However, the bill presently seeks to not preclude someone perhaps in a middle school who would like to be involved in this. Then, secondary vocational education, which is felt to be a very important component now, would be working with high school educational facilities. Number 329 MR. RUBADEAU said the postsecondary vocational education institution is viewed as not only the public but the private vocational education institutions. These four members are part of the 15 percent requirement. This is mandated by the federal government. REPRESENTATIVE DAVIS said line 9 on that same page reads, "...four representatives of business and industry...." That is then broken down. Representative Davis then read another requirement: "...at least one representative from an organization representing employment and training needs of Alaska Natives...." He asked if that membership place may serve as one of the four stipulated on line 9. MR. RUBADEAU answered yes. He said the bill aims for as much flexibility as possible, and to be culturally and regionally sensitive. Number 394 REPRESENTATIVE ROKEBERG asked to pursue the same line of questioning as Representative Davis in terms of membership on the council. He asked if there was anything required by federal statute that requires the Lieutenant Governor to be on the commission. MR. RUBADEAU replied that there was not. REPRESENTATIVE ROKEBERG asked if there was anything in federal statute that requires that both the Commissioner of Commerce and the Commissioner of Community and Regional Affairs be on the commission. MR. RUBADEAU again replied no. REPRESENTATIVE ROKEBERG said it was indicated in the bill that it was a policy call as to insuring a private sector majority. Squeezing the best possible out of 23 members, he can only find nine that might even be considered as representing the private sector. He asked Mr. Rubadeau to explain the breakdown of those members. CO-CHAIR BUNDE interrupted and asked Representative Rokeberg, Co- Chair Toohey and Representative Brice to work with Mr. Rubadeau to answer just those types of questions. He then asked that the bill be heard again. He asked for the wish of the committee, and the committee indicated agreement with that decision. HB 309 - APPROVE U OF A DEBT FOR STUDENT HOUSING  HCR 18 - UNIVERSITY OF ALASKA STUDENT HOUSING Number 528 TOM ANDERSON, Legislative Assistant, Representative Terry Martin's Office, testified on behalf of Representative Martin that HB 309 is basically an attempt to curb the current University of Alaska statewide system shortage of housing needs. Specifically, the bill addresses the University of Alaska Anchorage, Juneau, and Ketchikan campuses. The bill is an authorization bill. Representative Martin believes the Board of Regents have worked out a significant plan with the Alaska Housing Finance Corporation (AHFC). MR. ANDERSON said the companion HCR 18 is simply an endorsement resolution. Backup material is available for all three projects, and both the chancellors from the university in Anchorage and the Juneau campus were available to testify. Number 631 WENDY REDMAN, Vice President, Statewide University System, said the chancellors are present at the meeting to provide testimony on the need for housing. However, Ms. Redman wanted to comment on a few things to clarify some questions on what appears to be a more complicated procedure than necessary. MS. REDMAN said HCR 18 is a bill that authorizes the AHFC to move forward with the 3 percent housing bonds for the university. The university has been working with the AHFC for several years on a variety of plans for them to involve themselves with the university's student housing provisions. HB 309, which goes with HCR 18, is an authorizing bill. There are currently statutes which require the university to get a separate authorization if it is going to incur debt service in excess of one million dollars. MS. REDMAN said the housing debt will go to help pay off the 25 year bonds. There may well be a third piece to put all this together. It would probably be in the front section of the budget bill if that is where the university needs it. Ms. Redman said, "That would then authorize the AHFC to extend their reserves back to AHFC from their reserves back to an expenditure account, which is a third piece to it." Number 706 MS. REDMAN said she also needed to point out that this bill is linked absolutely to HB 281, which the HESS Committee was going to hear very soon. That bill is part of the AHFC funding for the deferred maintenance of the University of Alaska. That bill also includes provisions which protect AHFC assets so that it can do the kinds of projects envisioned. Without that kind of protection of AHFC's assets, the university will not be allowed to use them, nor does Ms. Redman believe that it would in any way go forward with approval for the student housing provisions. MS. REDMAN wanted to make sure that HESS Committee members understood these bills; and while they may not appear to be linked at this point, they are absolutely integral to each other. Number 770 MARSHALL LIND, Chancellor, University of Alaska Southeast, felt this group of legislation was a creative way of dealing with problems at two of the Southeast campuses. The university has been trying to acquire additional housing on the Juneau campus for several years. The university was successful this year in having the Governor recognize it and include it in his capital budget. The proposal that is contained in HB 309 makes sense. MR. LIND said the university has done a fiscal analysis as to whether or not it can pay, and the university feels it can. The plan for the Juneau campus has already been designed, and it will be ready to go to bid in a very short time. The university has been working on that project for a number of years. It will give the campus an additional 81 beds. Currently, there is room for 200. Number 828 MR. LIND said this bill also allows the University of Alaska Southeast (UAS) to make some modifications to the food service area. This will be necessary because the type of housing facility UAS is proposing does not contain kitchen facilities. It is more a traditional, dormitory-type operation. It is more traditional in the sense that there will be two students to a room, and two rooms share a bath. Those rooms will not have kitchen facilities. MR. LIND said this is a good approach to meeting the problem on the Juneau campus. In terms of Ketchikan, there is $1 million containment. The community has been working on a project in Ketchikan for close to ten years. The community has come up with a plan that it feels it can support. It has created a nonprofit housing corporation in Ketchikan involving a number of local business and finance people. Number 882 MR. LIND said this project is supported by the city mayor, the borough mayor, and others in that community. This legislation will enable them to go with one of a couple of choices. They can either choose a facility that would accommodate 16 students, or possibly 32. Mr. Lind believes that facility will serve that portion of Southeast Alaska very effectively, especially as traffic increases between Prince of Wales Island and Ketchikan as a regional center. MR. LIND continued that this would help the community a great deal, and the community is very strongly behind it. Mr. Lind encouraged the HESS Committee members' support for HB 309. It is a creative way of dealing with a problem. Number 926 REPRESENTATIVE BRICE noted that Mr. Lind stated the housing was in the Governor's capital budget. He asked why it is needed in HB 309. MR. LIND suggested that perhaps the housing is not needed in HB 309. However, the housing is needed, one way or the other. Hopefully, it could prevail in the Governor's budget. If it does, the university would not have to borrow the money. The bill would just give the university the authority to do that. Rather than bet on one approach or the other, the university felt a strong obligation to do whatever it can to get housing for those students. REPRESENTATIVE BRICE noted that those in Fairbanks feel the same way. Number 980 REPRESENTATIVE ROKEBERG allowed that he is from Anchorage, and he has not spent much time in the community of Ketchikan. He asked if he was correct that the Ketchikan campus was, previous to the merger, part of the community college system. MR. LIND said Representative Rokeberg was correct. Since 1954, the campus has been in operation as a community college. Ketchikan is probably one of three communities that has given annually a local appropriation in support of that campus through borough tax dollars. REPRESENTATIVE ROKEBERG asked about the need of a commuter-type school for housing. MR. LIND said there has been a changing pattern in student interest. In addition, mobility patterns have changed to necessitate housing. In the past few years, there has been a significant increase in the traffic between Prince of Wales Island and Ketchikan. There is also a desire on the part of a larger number of students to complete the two year degree program. In particular, two year "AA" degrees are sought. MR. LIND noted this is a change from earlier years, when students were more interested in the single or occasional course. Now, the campus is experiencing more students who are serious about staying and completing a two-year program. This bill would help the entire operation. It would be particularly helpful for students who have families, and are unable to either acquire or pay for some of the other housing they might find in Ketchikan. Number 1069 REPRESENTATIVE ROKEBERG asked about the student enrollment at the Ketchikan campus, and if the campus grants degrees other than an two-year AA degree. MR. LIND did not know the exact figures, but he could get the numbers for Representative Rokeberg. However, the Ketchikan campus only contains the certificate programs, which are one year in duration, or the two-year AA programs. Four-year degrees are not granted at that campus. CO-CHAIR BUNDE had lived in Ketchikan at one time. He said it was extremely difficult to find housing in Ketchikan. Number 1125 LEE GORSUCH, Chancellor, University of Alaska Anchorage, said he was speaking on behalf of the students who the president commissar and the Board of Regents have asked him to serve. He wanted to speak particularly to his primary mission, which is to try and provide high quality programs that are accessible to the students who would like to pursue them. MR. GORSUCH said it is on the accessibility question that he would like to speak first. There are four or five types of students who are desperately in need of housing at the University of Alaska Anchorage (UAA). The first type of student is from somewhere else around the state who would like to have an urban experience in Anchorage, but their parents would not want them to come to Anchorage if, in fact, there was not some kind of protected domicile for them such as a dormitory or residence hall. MR. GORSUCH has received numerous correspondence from superintendents around the state who have said as much to him in writing. Number 1174 MR. GORSUCH said the second type of student is also from around the state. She or he would like to take a course that is only offered at UAA. For example, a student that would like to become a nurse would utilize UAA because it offers the only four-year or graduate program nursing courses. Those students would also like to have access to housing on the Anchorage campus in order to pursue their careers. That would be true in a number of other fields, whether the field be special education or some other specialized programs, where UAA is the only campus that offers those programs. MR. GORSUCH said there is another group of students who might, for a variety of reasons not the least of which would be in the student status, would be of an indigent nature. In other words, the student does not have much money. The students are simply in need of finding some place that has affordable housing, that is reasonably safe, that doesn't require transportation. Traditionally, university dormitory housing is one of those that meet that need. Number 1220 MR. GORSUCH said as the cost of education increases through raising tuition, the affordability question becomes a key issue. Affordable housing is one of the issues that many students have to confront. From the university literature, HESS Committee members know UAA only has 390 housing units on the campus currently. UAA is a very large, substantial campus. This is no longer a question of the small university. UAA has 16,000 students taking courses, and another 5,000 students take courses from UAA's extended sites. MR. GORSUCH noted that UAA is a very significant institution. Nationally, most universities have somewhere in the vicinity of 35 to 50 percent of the students accommodated with housing. UAA accommodates 2 percent. In other words, 2 percent of UAA students are afforded the opportunity of campus housing. REPRESENTATIVE AL VEZEY arrived at the meeting at 3:15 p.m. MR. GORSUCH continued that the fourth class of student who is interested in student housing is the student who desires an international experience. Of the 16,000 students, even if a small percentage of them wanted to have a year of study abroad or wanted to have an exchange agreement in Korea, Japan, etc., the only way that exchange works is if the student can offer the exchange student a place to live on the university campus. MR. GORSUCH said universities extend to UAA students the opportunity of student housing. However, UAA has no capacity to reciprocate. Number 1285 MR. GORSUCH summarized that there are a large number of students who are not being served because of UAA's incapacity to offer campus housing. MR. GORSUCH also asked to speak on behalf of some parents with school-aged children who would like to attend UAA. Their children would like to have a traditional campus life experience. They want an opportunity to have meals together, have parties together and hopefully study together. As it currently stands, UAA cannot offer that opportunity, so many parents and their children do not think of UAA as one of their options. They select a university in the Lower 48 if they do not pick the University of Alaska Fairbanks (UAF). Number 1320 MR. GORSUCH noted that as the cost of education increases around the country, UAA is a "best buy." However, it becomes a best buy only if it meets the quality of life that students and parents are looking for. Many parents feel if they are going to finance the education, they would like to have at least one fringe benefit associated with the financing of their children's education. That is to get their children out of the house. MR. GORSUCH continued that UAA has many needs. A better library is needed, and there is not enough full-time faculty relative to the size of the student population. There are many needs, and those needs require hard general fund dollars. This is a need that is obvious, but the university is trying to meet its need creatively through the AHFC. The university thinks the AHFC is set up exactly for these needy students. It is an appropriate use of the Alaska Housing Finance Corporation assets. MR. GORSUCH felt the students are eligible, because in almost all instances they would meet any criteria of financial need for eligibility purposes. Most importantly, students who are in that first year dormitory experience do better academically. Their grade point averages are higher because of the attendant restrictions and opportunities of a study hall and study groups. Number 1403 MR. GORSUCH therefore noted that housing makes sense for good, solid academic reasons. He urged the support of HESS Committee members, and he felt that the entire state's interest is served when the legislature looks at trying to do more with less. This legislation does not solve UAA's library problem, nor does it solve the faculty resource problem. But it does increase the university accessibility for students who have a need for housing. MR. GORSUCH stated the quality of the academic experience will be increased for those students who have the opportunity to enter the residence halls, and it is going to make a significant transforming impact on the community's image and support. Number 1438 MR. GORSUCH continued that what is not written is that he has pledged that he will raise $1 million in support of the project itself. It is an opportunity for the Anchorage community to come forward and make a financial commitment to the growth and development of the campus. Even though this is a small step, it is a very significant step. Symbolically, it represents a sense of optimism and a future for the community in the face of all the financial pressures being confronted with the decline of oil revenues. MR. GORSUCH concluded that this is a very important project for a variety of reasons for the Anchorage community and UAA in particular. He urged HESS Committee members' support. Number 1470 CO-CHAIR BUNDE assumed from Mr. Gorsuch's comments that if UAA has more housing, it is more convenient for students from outlying areas to attend UAA. That might help the state address those incredibly expensive remote campuses that suffer from a lack of cost effectiveness and economies of scale. CO-CHAIR TOOHEY asked Mr. Gorsuch if the legislation passes and the university system gets housing in Anchorage, Ketchikan and Juneau, if every effort will be made to fill those housing units 12 months out of the year. MR. GORSUCH said the only way the plan works financially is for 12- month occupancy. There are exciting plans for summer institutes, programs that will bring high school students desiring immersion experiences in language and who want to learn about Alaska Native cultures. There is a very ambitious plan to occupy this facility 12 months out of the year. CO-CHAIR TOOHEY asked for assurance that the housing would not be provided for free. MR. GORSUCH answered no, the facilities would not be made available for free. Number 1519 REPRESENTATIVE DAVIS asked if Mr. Gorsuch has contacted other campuses, and if other campuses have requested funds or expressed dire need. MR. GORSUCH said a fairly comprehensive survey was conducted at the request of the Board of Regents. To his knowledge, no other campuses have come forward requesting similar facilities. REPRESENTATIVE BRICE was incredulous that UAF does not have any housing needs. He felt he did not quite understand. Mr. Gorsuch had said there had not been any requests from other campuses for similar needs. Representative Brice wanted to know if all the campuses in the University of Alaska system were questioned, or if only the campuses in the UAA system were proposed. MR. GORSUCH said the survey was done in the entire university system, but his reference was seven sites in the Anchorage area. REPRESENTATIVE BRICE concluded that there are, therefore, needs outside of the Anchorage area. MR. GORSUCH said he could not speak to those. REPRESENTATIVE VEZEY left the meeting at 3:20 p.m. Number 1583 REPRESENTATIVE ROKEBERG asked Mr. Gorsuch how many on-campus rooms are available now in the UAA system. MR. GORSUCH answered 398. REPRESENTATIVE ROKEBERG recalled Mr. Gorsuch's mention of the 12- month utilization of rooms. Representative Rokeberg asked if he had considered senior citizen seminars, etc., as possible summer tenants. He said there are many possibilities for those rooms. MR. GORSUCH agreed. He said the elder hostel-types of programs around the country have indicated a very significant contribution can be made to housing in the summer months. There is also a very significant opportunity to house professional conventions, whose participants would also be seeking some affordable housing. Many hotels are $200 a night. However, Mr. Gorsuch assured HESS Committee members that in all instances the conventions would be for educational purposes. MR. GORSUCH has worked with most of the hotels in Anchorage to insure that this is in no way any competition with the Anchorage area visitor industry. Number 1631 REPRESENTATIVE ROKEBERG asked if campus housing would assist in the recruitment of athletes to the UAA campus. MR. GORSUCH said it helps promote the overall image of the campus to offer a full program that includes some type of campus life and facility. Mr. Gorsuch could not over-emphasize the importance of what happens when a resident capacity is present on the campus to create an atmosphere of an intellectual community. If one's only attachment to the university is to have a parking space and a seat in a classroom, the attachment will not be great. MR. GORSUCH felt campus facilities provided the opportunity to sit with friends, drink coffee and have a conversation about what is occurring inside the classroom. New horizons and challenges can be explored. The athletes are certainly among those who would be interested in campus housing opportunities. Number 1688 REPRESENTATIVE BRICE understood that UAA is not considered a residential campus, and that the Board of Regents, when developing the mission statements for each institution, purposefully left out UAA in order to keep its focus on other things. Representative Brice's concern was why residences were being built versus libraries. In addition, Representative Brice wanted to know if there had been any discussion between the administration at UAA and possibly private consortiums that develop and construct facilities on campus on a type of 50-year-lease basis. The private entity would own and run the facility. MR. GORSUCH said he would not be present at the HESS Committee meeting without the express authorization of the Board of Regents. Therefore, the legislation carries their full endorsement and support. If there had been any sort of prior designation of no housing, it is not the current policy, because this legislation reflects their wishes. MR. GORSUCH then spoke to the option of building a library versus a residence hall. He said he would gladly take a library if that were available. However, a library generates no revenue to make it self-supporting. Unless Mr. Gorsuch could receive a $28 million capital appropriation for the purpose of a library, this project does not compete with that at all. This is an auxiliary facility in which the student rents basically retire the debt for the facility. MR. GORSUCH also added that a model facility is proposed in the sense that the expectations are that the student rents in auxiliary will not only pay the mortgage, but they will also pay for the cost of the residential life program. Secondly, the rent pays for the full operation, maintenance and replacement costs of the facility as well. Therefore, the way this is structured is that there will be no future deferred maintenance issues associated with this facility. It is essentially self-financed, with the interest subsidy. Number 1789 REPRESENTATIVE BRICE expressed concern that UAA's proposed facility was therefore competing with members of the private sector. He knows of a number of cases in various other institutions of higher learning in which the university contracts out the construction, operation and maintenance of these types of facilities. The private entity also provides the same type of traditional campus life. REPRESENTATIVE BRICE feels this is a viable option, and he has been pressing his administration up at UAF to study this option as well. If this option is viable, and if the state is going to break even on that option, Representative Brice is not sure that the state could not find another entity to save the state's bonding authority. Number 1822 MR. GORSUCH answered Representative Brice that he has had extensive conversations with members of the hotel industry about this particular issue. The possibility was discussed of whether or not this facility could serve as a hotel in the summer and a student dormitory during the nine months of the school year. The answer was no. However, it is true that the university can find private sector support for financing, somewhat conventionally, of the apartment-style houses. These would be a seven-story structure that has a whole different construction element and cost. MR. GORSUCH said from the conversations he has had with Bob Hickel, Al Parish and others, the consensus is that this does not work under any kind of private scenario. However, it would work under this low interest relationship for the AHFC. MR. GORSUCH noted that subcontracting out some of the services is an open issue that the university is receptive to in terms of trying to have a very cost efficient system. The university has to make money on its auxiliary services or it will not be able to repay the debt. Therefore, the university is very much receptive to the idea of outsourcing or subcontracting some of these elements like the food service. Number 1865 CO-CHAIR TOOHEY asked about the approximate student enrollment in Anchorage. Mr. Gorsuch answered about 16,500 as a head count. The full-time equivalent (FTE) enrollment is about 10,600. Co-Chair Toohey asked about the Fairbanks enrollment, which Mr. Gorsuch answered was around 6,000 students. Co-Chair Toohey then asked how many students the Fairbanks campus can house, and the approximation was 2,100. It was again determined that UAA can house 398. CO-CHAIR TOOHEY said that times have changed since she was a graduate of UAA. She thinks increased housing in Anchorage is necessary, there is no doubt about it. Number 1922 REPRESENTATIVE BRICE said the question he is trying to get answered is that the Board of Regents have developed mission statements for each of the three campuses. Those mission statements do not place Anchorage as being a major residential campus. Not only that, but there are private contractors that have worked out of the university system and a lot of various campuses that have built and run the student housing without state assistance. MR. GORSUCH said he is unaware of any mission statement that has "residential campus" in its character. REPRESENTATIVE BRICE suggested that perhaps the statements have changed since 1990. MR. GORSUCH asserted that he would not be before the HESS Committee without the authorization of the university system. REPRESENTATIVE BRICE understood, and assured Mr. Gorsuch that he was not implying to the contrary. Number 1969 CO-CHAIR BUNDE said he has been in the system long enough to remember that had regents originally had their way, there would not have been an Anchorage campus at all. REPRESENTATIVE ROKEBERG asked if Ms. Redman could clarify the situation. MS. REDMAN appreciated the comments of Representative Brice. The board's decision is clearly that Anchorage will not become primarily a residential campus. That is not appropriate for the mission right now. However, three times the amount of housing that UAA is currently seeking could be added and it would still be substantially below even what an urban university has. The proposed housing does not bring the university anywhere close to what would be available on a residential campus. MS. REDMAN said a residential campus is a campus where one would expect to see 75 to 85 percent of the students in on-campus housing. Those are the ratios that Fairbanks is looking at, as it is a residential campus. Anchorage is seeking residence halls, not to turn into a residential campus. Number 2057 BILL HOWE, Deputy Commissioner, Treasury Division, Department of Revenue, said he was not present at the meeting to speak on the merits of student housing. He wanted to talk about the proposed involvement of AHFC in the project specific to the requested subsidy and the assumption that the AHFC can raise new bond issues of $36.5 million that is required to fund the program. MR. HOWE explained that for the AHFC to raise the $36.5 million, it has to access the bond markets. Bond sales at competitive and attractive interest rates are a function of having the ability to have the bonds rated as investment grade. Investment grade bond ratings are a function of the investment community having confidence that their bond holders will get paid back the money paid for the bonds plus interest over the 25 years. Number 2111 MR. HOWE said it is no secret to most legislators that the AHFC has been recently put on "credit watch" by one of the major bond rating agencies, Standard & Poor (S&P). S&P is evaluating the current A+ rating that the AHFC currently has. That rating is well into the middle range of investment grade. MR. HOWE said Mr. Dan Fauske, who is the executive director of the AHFC, has just returned from a meeting in New York with S&P. However, in summary S&P has issued a press release, effective yesterday, that it very much likes the approach in HB 281 and SB 143 which are the Governor's effort to program, over a five-year period, a transfer of capital from AHFC in an orderly manner. MR. HOWE said the total of the funds transfer will be $270 million over five years, including $30 million this year. S&P has reviewed that program, and the press release says the company supports that program. The release also says that if that program is adopted, S&P will take the AHFC off of credit watch and reinstate its prior status. Number 2174 MR. HOWE said HCR 18, if considered outside the total scope of the legislature's intent on how to deal with the AHFC simply adds fuel to the fire on the part of the credit agencies in terms of increasing their apprehension that the legislature will continue to drain funds out of the AHFC with no end in sight, and the interest subsidy in effect, does that. In addition, it increases the credit agencies' unwillingness to consider the AHFC as having investment grade bonds. MR. HOWE said another example that has the attention of the rating agencies is SB 40. SB 40 will require the AHFC to transfer over an 18-month or 2-year period over $400 million--with no end in sight-- back to the general fund, leaving the bondholders exposed to some degree as to their ability to get paid over such a long period of time. TAPE 95-40, SIDE A Number 000 MR. HOWE concluded that the AHFC wants to work with the university to meet the student housing needs. There is no question about that. But in the opinion of the AHFC and the Department of Revenue, the program presented must be incorporated into the overall AHFC capital budget, grant program, subsidy program that is considered at that time. The legislature can then begin to apply priorities as to how it wants to utilize the capital available to housing programs, and how the student housing in Anchorage, Ketchikan and Juneau fit in. MR. HOWE said for AHFC to deliver the services being requested it has to be financially strong. HB 309 will not achieve that objective and will increase uncertainty. CO-CHAIR BUNDE interjected that if the goose that lays the golden eggs is killed, "there won't be much for omelets." Number 109 CO-CHAIR TOOHEY asked what the bank balance was of the AHFC at the moment. MR. HOWE answered that the AHFC has approximately $700 million in cash. CO-CHAIR TOOHEY said it is very understandable that the AHFC is on a credit watch, because there are no restrictions on what the legislature can take. The AHFC could be done away with today, and ten dollars could be left in the bank account. However, that would be extremely foolish. Co-Chair Toohey asked how taking $270 million out of the AHFC and putting it into the general fund will benefit the housing projects. That would not benefit the housing projects in the state. MR. HOWE said that is up to how the legislature wishes to allocate the general funds. CO-CHAIR TOOHEY asked if, in Mr. Howe's opinion, bonding was not a better way. MR. HOWE said bonding is certainly a better way to go in terms of funding programs. Generally, he concluded, that is true. The AHFC has the ability to raise money at attractive interest rates because of their bond rating. That basically leverages their capital to be able to deliver more programs to more people. Number 222 CO-CHAIR TOOHEY asked if the Governor's office and S&P would be satisfied if the legislature attached to HB 309 the ability to only take out $36.5 million plus another $20 million from AHFC a year. She said that would be the limit that can be taken out of the AHFC each year. She asked if that would make the Governor's office and S&P happy because there is a limit on what the legislature can take from that account. MR. HOWE said the Governor's office believes that the AHFC can transfer to the general fund $70 million this year, and $50 million for the next four years to help balance the budget without impairing the ability of the AHFC to raise money through bond sales and having an investment grade. S&P in New York has reviewed that program and has endorsed it. Therefore, to the degree that the legislature only wants to take out $36.5 versus $70 million would appeal to the bondholders, but the Governor's office would probably say that more can be done to cover the budget gap. Number 317 REPRESENTATIVE ROKEBERG understood that the legislature needs to have a plan for its desire to reach into the balance sheets of the AHFC. The legislature needs to look into the many programs that are before it. Representative Rokeberg felt that Mr. Howe was saying that all those programs have to fit together in such a manner so he would be comfortable with this particular bill. MR. HOWE said that is correct. REPRESENTATIVE ROKEBERG asked if it was somewhat difficult, in his opinion, to look at the bill discretely without looking at the big picture. MR. HOWE was saying that the AHFC can lose its bond rating through 1,000 cuts as opposed to just a major withdrawal. REPRESENTATIVE ROKEBERG surmised that it would be Mr. Howe's recommendation if HB 309 is passed by the legislature, that the legislators should listen to the Governor's recommendation about the ability to access the equity of the AHFC in the future. MR. HOWE said Representative Rokeberg was correct. REPRESENTATIVE ROKEBERG said therefore, bonds will be sold on a separate issue, rather than being part of a major package, like a larger, $100 million-type AHFC housing bond. Representative Rokeberg asked if the bonds would be discrete, stand-alone bonds. MR. HOWE answered that he believed there would be a separate issue, and it would be a specific side. REPRESENTATIVE ROKEBERG asked if there would be a higher rate of interest than otherwise because of that. In other words, a lower gross value of the bond face, vis-a-vis the totality. MR. HOWE said the AHFC has issued over its 20-year life span $9 billion of bonds, of which $2 billion are outstanding. Therefore, Mr. Howe does not believe this one issue would affect it one way or another. It would be rated primarily on the general obligation merits of AHFC, since the AHFC is required in this program to subsidize the loan repayment. REPRESENTATIVE ROKEBERG asked if Mr. Howe was saying he did not think it would have a negative impact on the interest rate level because this would be a smaller, stand-alone issue in the total picture. MR. HOWE agreed. Number 510 REPRESENTATIVE DAVIS said Mr. Howe has been talking about the AHFC's bond rating. He asked if there has not been a whole string of ratings. He asked if the state was worried about losing the ability to bond altogether, or if the fear was losing the AHFC rating at a certain level. MR. HOWE said there was concern about two issues. One is losing rating on existing bonds. Bondholders who hold $2 billion on AHFC paper, bought at a certain price predicated on the "double A" or "single A" rating depending on the type of issue. They can sell those bonds. There is a market because of the rating. If the rating is withdrawn because of the uncertainty about the AHFC future as Co-Chair Toohey pointed out, in all likelihood, unless this issue is resolved or if some of these other bills are passed, as well as HB 309, and AHFC loses its bond rating, those bondholders then can not sell the bonds for the same basic price paid regardless of the interest rate. MR. HOWE said the liquidity for the ability to sell into an open market disappears. The bonds can only be sold on a private placement basis. Number 585 MR. HOWE said a second issue is that for new issues, the lower your rating, the higher the interest rate to compensate for the risk. CO-CHAIR BUNDE felt that if HESS Committee members choose to pass HB 309 and HCR 18, it places additional emphasis on the fact that the House is willing to accept the other Governor's bills. Number 638 JACK DALTON, President, Union of Students, University of Alaska Anchorage, said he has come down to Juneau three times attempting to get funding for housing. Each time, however, he has been turned down because the state of the economy and expenditure cutbacks. However, this time the Union of Students is more optimistic. The 388 students living on-campus currently were very excited about that aspect. Those students are willing to do almost anything to convince HESS Committee members that more student housing is a great idea. MR. DALTON said the 600 students on the waiting list for university housing each year feel the same way. Mr. Dalton offered the assistance of the Union of Students to the HESS Committee members in getting the bill through or asking for money somehow. Number 723 REPRESENTATIVE ROKEBERG assured Mr. Dalton that the legislature holds many friends of UAA, and that he is a former faculty member of UAA. Representative Rokeberg supports the Union of Students and the plea for student housing. Number 752 HEATH HILYARD, Legislative Affairs Director for the Associated Students, University of Alaska Fairbanks, said the Associated Students support HB 309 and HCR 18. There has been much discussion with colleagues in Anchorage. Mr. Hilyard said that he has, for the last four years, been living on a campus with a large degree of student housing. He can therefore understand what kind of community it builds, and how important campus housing can be in establishing a strong university community as is spoken to in HCR 18. MR. HILYARD said he wanted it to be known that the students of UAF do not feel threatened by UAA's possible acquisition of housing, and they support the idea. Number 813 CHRISTINA BROLLINI, Senator, Union of Students, University of Alaska Anchorage, reiterated that there is a desperate need for housing. There are approximately 1,000 students each year that are turned away due to housing shortages. In addition, the UAA library is very important to the university students. The students have created a $5.00 fee which will generate $85,000 per semester to fund the library. Therefore, she assured HESS Committee members that the students realize that they need to start contributing to university projects, and the library is a main concern. MS. BROLLINI assured HESS Committee members that students are putting in their share. The housing is needed, and she strongly encouraged HESS Committee members to support this legislation. CO-CHAIR BUNDE asked Ms. Brollini to take the message back to the Union of Students that he is impressed that the students are willing to assess themselves for the library. Number 891 DAVID WALKER, Chairman, Rules Committee, Union of Students, University of Alaska Anchorage, voiced his support and the support of the student body for this legislation. He asked HESS Committee members to remember that this housing will not simply provide 600 beds. It will provide a community to the student body in Anchorage. MR. WALKER noted that when students choose where they want to go to college, they do not really look at mission statements, etc. Mr. Walker can personally attest to the need for student housing, as he is currently on the waiting list for housing this fall. He said it is very difficult to obtain university housing. It has been very hard for him to plan out his academic future because he does not know where he is going to be living. He has lived both on and off- campus, and he felt that living on campus is definitely better. MR. WALKER reiterated the comments of Chancellor Gorsuch that a student's grades are enhanced, as is their participation in extracurricular activities, when they live on-campus. This is an issue that the faculty, students and administration are standing together on, and he requested HESS Committee members' support. Number 971 REPRESENTATIVE ROKEBERG asked about rents charged by UAA for housing. MR. WALKER said the charge for an entire semester is about $1,050. That is just for the room. A dining facility will accompany the new housing complex, and that facility is also desperately needed. Such a complex breathes life into the social atmosphere. Mr. Walker said any college student knows that half of your education is from the classroom, and the other half is from interacting with peers and discussing what has been learned. Number 1043 CO-CHAIR BUNDE closed public testimony on HB 309 and HCR 18. He was not optimistic that the dorms will pay for themselves, and he is certainly not optimistic that the food service will be well- attended. However, he said those feelings are from his past experiences, and he is willing to let the current UAA students prove him wrong. He asked for the wishes of the committee. CO-CHAIR TOOHEY moved HB 309 and HCR 18 to the next committee of referral with individual recommendations and accompanying fiscal notes. REPRESENTATIVE BRICE objected. He said that considering that this piece of legislation was just introduced last week, and that the more substantive issue of addressing the needs of the whole University of Alaska system as embodied in the Governor's bills of HB 282 and HB 281 were introduced about one month ago and those bills have not even received their first hearing, Representative Brice felt the HESS Committee was getting ahead of itself. REPRESENTATIVE BRICE said that, combined with the testimony from the Department of Revenue causes him grave concern that without further advancement of the Governor's legislation, the legislature will be jeopardizing a great resource within the state. Number 1163 REPRESENTATIVE DAVIS said if he could find any alternative method of funding, something that has an opportunity to pay for itself, he would certainly do it. He felt this legislation was a great attempt, although it is probably not full-proof, and he supports this approach. REPRESENTATIVE ROKEBERG said he shares part of the concern of Representative Brice about the financing mechanism in the AHFC. Representative Rokeberg felt it would be very imprudent for this bill to reach the floor of the House without the other funding bills being in place or having been debated through the system of the floor. REPRESENTATIVE ROKEBERG noted that he is a "super UAA Seawolf fan and season ticket holder," and he would hate to have to vote against this bill. However, without the additional bills, he may be put in that position. Other than that, the support for UAS and the UAA campus he supports 100 percent. REPRESENTATIVE ROKEBERG said however, he has significant qualms about allotting a million dollars for the Ketchikan campus. He is not sure how many students are there, and he is not sure that 32 or even 16 students would be more than 2 percent for Ketchikan. He is not certain that a case has been made, but he is not from Ketchikan. There is no question in his mind about the housing needs of UAA. However, he does not feel a case has been made for the Ketchikan campus. Therefore, he asked to introduce an amendment that would delete that provision. Number 1273 REPRESENTATIVE ROBINSON objected and a roll call vote was taken. Voting "yes" on the amendment was Representative Rokeberg. Voting "no" were Co-Chair Bunde, Co-Chair Toohey, Representative Robinson, Representative Brice, and Representative Davis. The amendment failed. CO-CHAIR BUNDE called for the vote on HB 309. Voting "yes" were Co-Chair Bunde, Co-Chair Toohey, Representative Rokeberg, Representative Davis, and Representative Robinson. Voting "no" was Representative Brice. The bill passed out of committee. Number 1340 REPRESENTATIVE ROBINSON understood that HB 281 has been assigned to the HESS Committee. She assumed that the co-chairs understood the importance of hearing the bills quickly as HB 309 had just been passed. CO-CHAIR BUNDE acknowledged her concern, and assured her they would be addressed. He asked for the pleasure of the committee regarding HCR 18. REPRESENTATIVE DAVIS moved HCR 18 from the HESS Committee with individual recommendations. Representative Brice objected. REPRESENTATIVE ROKEBERG asked if the resolution was necessary because of the bonding appropriation. Co-Chair Bunde indicated that he was correct. REPRESENTATIVE BRICE said his only objection to the movement of HCR is the same as his objection to HB 309. He then withdrew his objection, and HCR 18 passed the HESS Committee. CONFIRMATION HEARINGS - UNIVERSITY OF ALASKA BOARD OF REGENTS Number 1457 CHANCY CROFT, Attorney, provided a short statement as a candidate for the University of Alaska Board of Regents. He said the university has a great challenge in front of it to maintain academic excellence while offering education to a wide variety of people over tremendous geographic distances. He sees the university from the perspective of a consumer. He is not a professional educator or an administrator. He has attended quite a few classes at UAA and Mat-Su. MR. CROFT said he was particularly concerned about the change that is going to occur in all universities over the next few years. He felt universities were going to change from educating primarily teen-agers and young adults to giving a second education to a lot of adults. Some people have to change jobs several times within their lifetime. Universities are going to therefore be educating adults. That is going to call for different techniques and approaches, and will provide some exciting opportunities for Alaska. MR. CROFT asked to show HESS Committee members something he found in a book about the best colleges and universities regarding community colleges in Texas. There are some innovative programs at those colleges, and they are finding that when college programs are adapted to what is happening with the economy, some pretty exciting things can occur. As a matter of fact, he and Joe Thomas, the other candidate for the Board of Regents, are going to take credit for the fact that they are just now attending their first board meeting, and they appreciate being scheduled by the HESS Committee members so they can appear before the committee at the same time. Number 1559 MR. CROFT said today at his fist meeting, Prince William Sound Community College presented three new career offerings for two-year degree programs. The school plans to graduate about 120 people a year in three different areas. MR. CROFT also wanted to mention that he has a long-time involvement with the community college system in Anchorage. In fact, his wife is a professor at the university. She recently became the head of the developmental education department. He accepted the decision of the voters made (although he disagreed with it) about the structure in 1988. Mr. Croft wanted to make sure, regardless of the structure, that the mission, the ideals and the opportunities of the community colleges are not lost as academic excellence is emphasized throughout the entire university. Number 1611 CO-CHAIR TOOHEY said she was heartsick when community colleges were done away with. She was a registered nurse who graduated from a community college, and she feels an educational niche was lost when that happened. CO-CHAIR TOOHEY said she is aware of a problem that occurred in Fairbanks. UAF was usurping a private enterprise policy, and was in competition with private enterprise in the community. That was addressed three times, and three times the problem was ignored. She wanted to make very sure that the university does not compete with private enterprise at any level. She wanted the candidates to be aware of that because it is a problem, and she does not want to see a lawsuit happen. Number 1673 REPRESENTATIVE ROBINSON suggested that Mr. Croft visit the Whitehorse community college system. Many of their programs are clearly directed toward what is happening in the economy also. That system also has an excellent program of mobile units. For example, students from rural communities who wish to be health care providers can receive schooling and then go back to their community. A mobile unit then follows the student. REPRESENTATIVE ROBINSON also asked if Mr. Croft had a chance to visit the UAS campus. MR. CROFT noted that he has spoken to Chancellor Lind about visiting the campus, and they are hoping he has the chance to do that. Number 1729 REPRESENTATIVE ROKEBERG asked Mr. Croft if he had played hockey lately. MR. CROFT answered that Representative Rokeberg was an excellent hockey player, but over the last few years he may have lost some of his speed and aim. Representative Rokeberg may find that discouraging. However, Mr. Croft said that he, personally, was "uniformly lousy." Therefore, he takes satisfaction in stating that he is every bit as good as he ever was. REPRESENTATIVE ROKEBERG said he is pleased to hear Mr. Croft's comments about the university system. He said if there is any way the legislature can help the regents in rectifying the problems caused by consolidation, Mr. Croft may elicit his help. REPRESENTATIVE ROKEBERG wished Mr. Croft well, and noted that any future mission statements drafted by the Board of Regents should not try to isolate the UAA campus, as has been done for a number of decades. Representative Rokeberg is concerned about some of the policies he has heard about in the meeting. He expressed confidence that Mr. Croft would represent his community fairly. Number 1821 JOE J. THOMAS, Business Manager/Secretary-Treasurer, Laborers' Local 942, basically sees the university as probably one of the greatest assets of the state of Alaska. Through proper use and guidance in a state with so much potential for development, Mr. Thomas sees the university as an integral part of the state. MR. THOMAS recalled a discussion about how close the university is in assessing job needs in industry, and working with industry representatives and students to make sure students get a useful education. Students must have the prospect of a job at the other end of their education. MR. THOMAS said that was, in a nutshell, his concern. The University of Alaska system is a broad subject to speak on, and hopefully people can get away from individual interests and concerns and do what is best for the people and students of the state. Alaska is broad and diverse. Alaska must deal with situations that are very different from experiences in the rest of the United States. The community college system was, and should be again an integral part of the university. He believes the university can move forward in a reasonable manner to take care of most needs. Number 1887 CO-CHAIR TOOHEY noted that the university is a land-grant university. She asked if it will be, at any time, the regents' responsibility to help select some allocated land. MS. REDMAN noted that legislation has not yet been passed. CO-CHAIR TOOHEY asked if the regents at any time will have the responsibility or any input into that selection. MS. REDMAN answered yes, absolutely. Number 1925 MR. CROFT stated the Board of Regents can also set the policy about the land as well. He noted that there is some disposal of land that is being reviewed as a result of the oil spill. CO-CHAIR TOOHEY said that is the background for her question. She asked if either Mr. Croft or Mr. Thomas had any "heartburn" about disposing, developing, cutting or mining the university's land. MR. THOMAS said the only concerns he would have would regard a community that may have some objections to what the university may be doing with its land. At least in his case, he would add that sensitivity to the board to make sure the board was not considering the surrounding community. Mr. Thomas conceded that may slow down the process in some people's minds. However, to actively accomplish long-term goals and keep the university in good standing with various communities, that is a necessary process. MR. CROFT said he graduated from one of the wealthiest land grant colleges in America. The first year he was a student, it was necessary to amend legislation to increase the range of investments from the University of Texas trust lands. He found it interesting he was working on this type of legislation as a regent. But he believes in land grant colleges, not for the preservation of land for parks, but because the land produces revenue. Number 1996 CO-CHAIR TOOHEY just wanted to make sure that neither Mr. Thomas nor Mr. Croft were "preservists." Neither are. REPRESENTATIVE BRICE noted that a better term is "conservationist." Number 2022 CO-CHAIR BUNDE asked Mr. Croft and Mr. Thomas what they philosophically and physically envision for the future. MR. THOMAS answered that he perceives the university as being one of the primary sources of education for the purposes of development in Alaska. He believes in higher education as being more than doctoral degrees. He understands the need for vocational instruction, and he supports that. He hopes the university will continue to move in that direction. He sees the university as being an integral part of the development of the state of Alaska and its future. CO-CHAIR BUNDE said part of the basis of his question regards the physical plant and the expenses of having a university entity in all the far corners of the state. Co-Chair Bunde asked if Mr. Thomas had any type of vision in that area. MR. THOMAS said that was a tough question, probably one the university has struggled with and the Board of Regents has wavered on. He certainly believes that the university should try and keep education close to the communities. Education is unsuccessful if it tries to remove people from the far-flung reaches of the state to bring them into a center. It does not appear to work very well in some cases (at least, that is what he is led to believe at this point). MR. THOMAS said therefore, although expense is certainly something that needs to be taken into consideration, the rural college program is important. How it is administered, what it covers, etc., is certainly a subject of study to make sure the college is not training in areas that will not provide work. Mr. Thomas is very concerned that the university educate people with useful skills. MR. THOMAS felt more sophistication was needed in the process of what the university is trying to accomplish. Mr. Thomas felt that rural campuses were necessary, and he supports the rural campus theory. Number 2144 MR. CROFT supported the rural campus theory, but he thinks the rural campus education can be accomplished without a heavy emphasis on the facilities. Most parents are worried that their children learn more from television than they do in the classroom. It is a mistake for the regents to be preoccupied with classroom education throughout Alaska where there are obviously communities where those classrooms cannot be built. It would also be a mistake to ignore the possibilities of television, computers or follow-up learning through mobile units and other methods. MR. CROFT stressed that those options must be utilized because facilities cannot be built. Number 2175 MR. CROFT said secondly, the university must use the existing facilities. The whole community college structure was very able to respond to the needs of the community because it was in the community. It was using the high schools, the junior highs and the existing community facilities. In that way, contact was maintained with the community, and the school became more responsive to the community when using community facilities. MR. CROFT said the university does not have to equate building facilities everywhere educational opportunity is desired. Frankly, that line of thinking must be avoided if the university is going to provide the maximum opportunity that people deserve. CO-CHAIR BUNDE said he has just gone through an assessment process of all the branches of the university. He commends the branches for their effort; self-examination is not always fun. Part of one of the facets of that was productivity. A number of students in the classroom and the hands-on experience from various teaching entities provides a new view of the assessment process and goals, and a view on productivity. Number 2233 MR. THOMAS said he did not study the process, and he has heard only briefly about it at some of the meetings. He does not want to seem uninformed, but he is not so sure, without looking at the process, that the program assessment was definitely budget driven. He also has some concern about where the centers of learning might be, and that there might be some skewed statistics that were interpreted in a certain way. MR. THOMAS reiterated that he had not taken a close look at the process. He acknowledged that it is a large and sophisticated study, so it will take some review. However, he plans to look at the study. He was concerned that oversimplification of statistics may cause people to come up with some findings that might not be accurate or might not be advantageous to communities. A study may be conducted which indicates that some programs should be cut even though other factors, perhaps qualitative, have not been considered. Number 2288 MR. CROFT felt the evaluation was a good idea, but he was a little concerned that the data was not uniform. Therefore, the figures retrieved from one campus were not comparable to another. That may be what Mr. Thomas was alluding to in his concerns. However, Mr. Croft felt the idea of the study was good. MR. CROFT felt there was a problem with the evaluation, however. He remembers that former Alaska Governor Hammond had an efficiency in government commission. The recommendations of the commission was referenced in 1977 in the budget. By 1988, no one spoke of the recommendations anymore. Those recommendations were lost. That is the problem with evaluations. The organization must keep going back over them every time to make sure they are implemented. MR. CROFT felt that frankly, the tuition increase is the biggest indication of what has happened in the last six months. Mr. Croft wanted to make sure it was not the only indication. He felt the students are going to pay their fair share, but the other side of that is those recommendations have to be implemented. Mr. Croft was worried that, unless those recommendations are constantly revisited, they will fade away. TAPE 95-40, SIDE B Number 066 CO-CHAIR BUNDE asked for Mr. Croft's perception of productivity, where it is and where it should be. MR. CROFT said there were several questions concerning compensation, tenure and productivity which were most difficult to wrestle with. Those issues are on the agenda for the next six months. However, he thinks that productivity varies widely across the board. It is something that must be addressed. REPRESENTATIVE BRICE commented that when talking about productivity it is very important to look not only at credit hours taught, but also to look at relevant research brought to the institution. He also asked Mr. Thomas and Mr. Croft to consider the importance of the research that the University of Alaska system provides. Number 145 MR. THOMAS agreed the research is very important. In addition, the university must study who it produced and what they are doing six months after graduation as far as employment. That is crucial. Just cranking out numbers is not the answer. Cranking out numbers that can be successfully employed somewhere is probably the most important thing. The research that brings that about and causes it to happen shows that this is the direction one needs to go, even though the direction may change. REPRESENTATIVE ROBINSON said when looking at the university system, people have a tendency to focus on the single student, not the married student or the single mother with a child/children. She asked how Mr. Thomas and Mr. Croft felt about on-site child care centers and the need to make sure that those elements are part of the university system. MR. CROFT felt it was very important. Recognition of the non- single student on the university's part, as an older and older population of students enroll, is crucial. Number 250 MR. THOMAS agreed with Mr. Croft. There is a segment of the population that is looking toward education or re-education. Many of those students are now in their 40s and 50s, looking for a different or better career (or employment to begin with). Those people need different service than the typical single student who is 19-years-old and "fancy-free." CO-CHAIR BUNDE thanked Mr. Croft and Mr. Thomas, and read a statement. He read, "Our action here does not reflect any intent by any member to vote for or against these individuals during any further sessions for the purpose of confirmation." He then asked for the wish of the committee. REPRESENTATIVE BRICE passed the confirmation of the two Board of Regents members onto the full body of the House. There were no objections, and the names passed. HB 229 - PROHIBIT LOUD VEHICLE SOUND SYSTEMS Number 429 REPRESENTATIVE ROKEBERG, sponsor of the bill, said that noise is a form of pollution and a potential health hazard. He felt the bill should be approved based on the fact that it endeavors to alleviate that problem in one instance. CO-CHAIR BUNDE asked to speak to the bill as someone who was trained as a speech and hearing therapist. He is well aware of the damage that excessive noise can and has done to many people. He felt much noise damage is self-inflicted by young people at times. He also mentioned the psychological irritation due to excessive noise. He felt this bill was a good measure for protecting young people and protecting the sanity of the older people. CO-CHAIR TOOHEY asked about the penalties for violating the provisions of the bill, and who is going to police the provisions. REPRESENTATIVE ROKEBERG said the bill provides for an infraction only. It would be enforced by the state police and the law enforcement agencies of the various jurisdictions. The Anchorage Municipal Police Department has a municipal code already prohibiting this type of infraction. CO-CHAIR TOOHEY noted the sponsor statement says that the violation of this provision is an infraction not considered a criminal offense and does not add points against the person's driving record. She asked what the provision does to stop this behavior. REPRESENTATIVE ROKEBERG said it was a function of the state statute. The state statute stipulates that there only be a fine up to $300--that is the provision for infraction under Alaska Statute. Representative Rokeberg said the alternative would have been to create a misdemeanor offense, and Representative Rokeberg did not feel that was appropriate. Number 638 REPRESENTATIVE DAVIS said he did not have a problem with the bill, although he felt the reasons for the bill may be wrong. He has not heard any of these sound systems that are louder than most other things one runs into throughout the community. However, he thinks the issue is one of insensitivity. The excess noise is a nuisance. In addition, Representative Davis felt that those who install the systems also need to be penalized. Those who install systems, just as those who don't adequately tune up automobiles for their proper emissions, can get their licenses taken away. That is an issue that also needs to be addressed at some time. REPRESENTATIVE ROKEBERG ventured to say that the first amendment does not extend to installers. He did not think the amendment would be possible to extend. CO-CHAIR BUNDE said perhaps the problem would cure itself. If there was no demand, they would be no supply. REPRESENTATIVE BRICE said he has a car with a stock radio in it. He cannot tell if it is being heard outside the car or not. He asked how one would be able to tell if their sound system was "offensive." He asked if "audible" meant right next to the car, or 5 feet from the car, or 25-feet from the car. He asked for discussion on those topics. Number 817 REPRESENTATIVE ROKEBERG noted for the information of the committee that a review of the various statutes throughout the country and a number of states that have similar statutes have provided information that is being used by the sponsor of the bill. He is working on an appropriate amendment to overcome this grey area when the bill reaches Judiciary. Representative Rokeberg said he is attempting to gather some empirical evidence to determine between a 50 and 100 foot radius as opposed to the other measurements of sound that can be utilized. CO-CHAIR BUNDE suggested wording to the effect of "audible outside a car that causes a public disturbance." If someone is driving by 50 feet away and the ground is shaking, that is a problem. CO-CHAIR TOOHEY asked if Representative Rokeberg had considered mentioning if the window of the vehicle was open or closed. Co- Chair Toohey sometimes cranks up her stereo on the highway. She stated that this was somewhat different than those who drive through neighborhoods causing a disturbance. If the window is closed and the car is moving, the noise is not bothering her. It may be damaging the car owner's hearing, but it is not bothering her. When the windows are open, then it bothers her. Number 927 REPRESENTATIVE ROKEBERG said her point was well taken, and that is why the radius was being researched. Representative Rokeberg seeks to provide a standard of reasonableness. There is no intent to inhibit the utilization of any sound system. It is only when it becomes a nuisance that he seeks to curb the problem. In addition, there are certain situations in which emergency vehicles cannot be heard due to the noise from the car next to you. In certain urban areas, this can be a real problem. REPRESENTATIVE ROKEBERG also looks at this bill as another tool of law enforcement. The significant gang activities in Anchorage may allow the law enforcement agencies to investigate probable cause for enforcement. The main thing, however, is the noise. This is a "neighborhood friendly" bill. Representative Rokeberg assured HESS Committee members that the bill was going to be modified in the Judiciary Committee to alleviate concerns. Number 989 REPRESENTATIVE ROBINSON said she was curious. She was somewhat incredulous that there was not anything on the books regarding noise pollution. She knew of cases in which police visit houses only because children are playing their stereos or their bands too loud. Those individuals are ticketed for noise pollution. She felt the HESS Committee members and the legislature have more important things to do. REPRESENTATIVE ROBINSON did not feel the issue was in need of legislation. She felt the police, with already existing laws, could act if a problem was evident. REPRESENTATIVE ROKEBERG responded that Americans spend literally billions of dollars each year to try and abate noise. Noise is scientifically recognized as being a pollution problem. Then someone thinks he/she has a right to install a thousand dollar speaker system in their automobile and disturb the peace. That is not right. CO-CHAIR TOOHEY noted that Anchorage has its own ordinance. Therefore, she asked if the scope of the bill would not include Anchorage, as the state police do not cover Anchorage. Anchorage is covered by the municipal police. She asked if there are other cities within Alaska that have similar laws on their books. SHIRLEY ARMSTRONG, Legislative Assistant, Representative Rokeberg's office, said she checked with the Juneau Police Department, and Juneau does not have a vehicle noise ordinance like the city of Anchorage does. Juneau has a nuisance/disturbance noise provision. That is a misdemeanor. Therefore, the problem would have to be pretty prevalent in order for the police to intervene. CO-CHAIR TOOHEY asked if Ms. Armstrong checked with Fairbanks, and she answered no. MS. ARMSTRONG said a resident of Kotzebue called in favor of the bill. When Ms. Armstrong asked if this type of "noise pollution" was a problem in Kotzebue, the person said no, not yet. Number 1160 REPRESENTATIVE DAVIS said in discussions with contract jails, it has been discovered that city cops around the state are arresting people under state law, and it is the state's responsibility to pay for all that. Every city, except Anchorage, in the state of Alaska that has a police department and arrests people does so under state law. HB 229 creates yet another state law. Representative Davis did not have a problem with that, as what is going to have to happen is an automatic conversion to all state laws. Local municipalities are going to have to start covering the costs, and let their police make arrests. Then it would be that municipality's arrests and court costs, to a degree. REPRESENTATIVE DAVIS said the $6 million figure that is currently being paid out needs to be considered. If municipalities can handle these issues on their own, the legislature needs to make sure they have that opportunity. However, again Representative Davis said he did not have a problem with this bill as it is very inconsiderate of people to have obnoxious sound systems. REPRESENTATIVE BRICE stated for the record, "If it's too loud, you're too old." Co-Chair Bunde said "Amen." Number 1243 REPRESENTATIVE DAVIS moved HB 229 from committee with individual recommendations and accompanying fiscal notes. There were no objections and the bill moved. ADJOURNMENT Number 1263 CO-CHAIR BUNDE adjourned the meeting at 4:45 p.m.