MINUTES SENATE FINANCE COMMITTEE May 18, 1999 8:46 PM TAPES SFC-99 # 146, Side A and B CALL TO ORDER Co-Chair John Torgerson convened the meeting at approximately 8:46 P.M. PRESENT In addition to Co-chair Torgerson, Senators Dave Donley, Loren Leman, Gary Wilken, Lyda Green and Randy Phillips were present when the meeting was convened. Senators Al Adams and Sean Parnell arrived respectively thereafter. Senator Pete Kelly was absent. Also Attending: REPRESENTATIVE FRED DYSON; ALISON ELGEE, Deputy Commissioner, Department of Administration; ANNE CARPENETI, Assistant Attorney General, Criminal Division Juneau, Department of Law; CHRIS CHRISTENSEN, Staff Counsel, Alaska Court System; MIKE TIBBLES, staff to Representative Gene Therriault; aides to committee members and other members of the Legislature. Attending via Teleconference: JOHN ATHENS, PAUL LYLE, CAROL ALDERMAN, ANTON JOHANSEN, Regional Director, Northern Region, Department of Transportation and Public Facilities via offnet from Fairbanks. SUMMARY INFORMATION Co-chair Torgerson called the meeting to order. The committee first considered HB 34. HOUSE BILL NO. 34 "An Act relating to the crime of misprision of a crime against a child." CS FOR HOUSE BILL NO. 34(JUD) "An Act relating to the crime of failure to report the commission or attempted commission of certain crimes against children." CS FOR HOUSE BILL NO. 34(FIN) "An Act relating to the crime of failure to report the commission or attempted commission of certain crimes against children." REPRESENTATIVE FRED DYSON, sponsor of the bill was invited to join the committee. He commented briefly on the bill. Senator Donley asked about the fiscal note. Representative Dyson responded. Senator Green asked if this applied to all family members, brothers and sisters? Representative Dyson said that was correct. ANNE CARPENETI, Assistant Attorney General, Criminal Division Juneau, Department of Law indicated she would respond to any questions. Senator Donley said he wanted to know the department's position on class B misdemeanor as compared to a class A misdemeaner. Ms. Carpeneti said a class B was also acceptable. Representative Dyson said if the committee did not want to vote for the bill then to please amend it. Senator Donley and Senator Phillips had a brief discussion regarding the time factor to get this passed out. Representative Dyson said he felt the calendar was backed up. Senator Donley said he did not perceive a problem with the calendar. Senator Phillips said the problem might be in the House. Senator Wilken MOVED HB 34 and WITHOUT OBJECTION it was reported out with individual recommendations and indeterminate fiscal notes from the Public Defender Agency and the Department of Law. Co-chair Torgerson then called HB 199. HOUSE BILL NO. 199 "An Act relating to compensation for certain state employees; and providing for an effective date." CS FOR HOUSE BILL NO. 199(STA) "An Act relating to compensation for certain state employees; and providing for an effective date." CS FOR HOUSE BILL NO. 199(FIN) "An Act relating to compensation for certain state employees; and providing for an effective date." MIKE TIBBLES, staff to REPRESENTATIVE GENE THERRIAULT was invited to join the committee. He explained that the bill was an establishment of a new pay differential. It would freeze current employees at their current pay until through COLAS it would all catch up. Mr. Tibbles continued. The change to the SBS program reduces the State's contribution. The final point was that the bill placed a cap on the amount of wages against which contributions were made. It would set the cap at the 1998 level. He said this was in section five on page three. The cap related to all employees. Co-chair Torgerson asked if there were employees above that? Mr. Tibbles responded that the 1998 cap was $68,400. Senator Adams asked about municipalities and if they were exempted under sections one and two? Mr. Tibbles said sections one and two referred to the pay differential. Senator Adams again asked if this only related to State employees? Mr. Tibbles said he was not sure if the pay differential was used by municipalities. Senator Wilken read into the record a letter from a constituent who had laid out the whole program cut. ALISON ELGEE, Deputy commissioner, Department of Administration was invited to join the committee. She said they supported the amended version of the bill. Bargain contracts were in an amendment based on differential pay districts in the 1980's. Disparity has occurred in areas where there are union and non-union employees. This bill would correct a long-standing disparity and bring everyone under one schedule. In response to Senator Torgerson she said the differential applies to non-union members. Senator Wilken asked about the written testimony of his constituent. She explained that the 3.75 was the differential for longevity. They differ by step as she continued to explain. Upon completing the length of services one qualifies for longevity steps which is 3.75. Ms. Elgee identified "J", "K", "L" and "M" as longevity steps. Senator Wilken said it was his understanding that it takes three years to go from step K" to step "L". Ms. Elgee said that was also her understanding. In response to Senator Wilken, she explained the merit portion was steps "A" through "F". Adjustments could occur to the wage scale due to the cost of living allowance. Senator Donley asked about page two, line thirty. Ms. Elgee said this represented the current schedule in place for the union employees. She said this was the last version the Senate Finance committee had before themselves a few years ago. The Governor is concerned about the implications of reducing benefits to state employees especially with the passage of SCR 11 last night. Co-chair Torgerson said he would now take up public testimony from Fairbanks, offnet. JOHN ATHENS, Assistant Attorney General, Fairbanks testified from Fairbanks. Cuts are based on a 1986 study. Why is the administration in such a hurry to pass this bill so the differential can reflect this 1986 study? In answer to his own question, he stated it was because they want parity with the union workers. Perhaps a more recent study should be used. He felt that the geographical differential change was specifically targeting Fairbanks individuals. PAUL LYLE, testified from Fairbanks. He said this bill was a lot better than in previous versions. It still has some fundamental disparities that need to be fixed, however. He said he would acquire no pay raise until he is 55 years old. It was not fair that employees will never see a pay increase. Legislators get a raise in their per diem however state employees get no pay raise. This needs to be fixed in this bill. "Grandfathering" also needed to be looked at. "Why should our pay be frozen for ten years?" He referred to the change to SBS and also Article XII, Section 7 of the Alaska Constitution. He felt they were falling behind the private sector. The idea of freezing pay and reducing SBS was not a good one. Senator Phillips commented on the per diem. He said it dropped several dollars a few years ago. When he brought it up to the press they considered it an unimportant issue. Senator Wilken asked about the letter that he received and commented briefly on it. Senator Wilken further said he would have his staff contact Mr. Lyle and have him fax his written testimony. CAROL ALDERMAN, paralegal, Department of Law, Fairbanks, testified via offnet. She explained that she was a classified employee. These were the employees needed the most. She said their situation was only going to get worse. Another area of concern was the change in SBS for new people. They should all be treated the same. ANTON JOHANSEN, Regional Director, Northern Region, Department of Transportation and Public Facilities in Fairbanks, testified via offnet. The bill would have no personal effect on him. His concern was with the geographical pay differential. Senator Donley said he supported the geographical differential but had concerns with the SBS. Senator Donley MOVED amendment #1 to delete sections six and seven regarding SBS. By a roll call vote of 1 yea (Donley) and 7 nays (Torgerson, Parnell, Phillips, Green, Adams Wilken, Leman) (P.Kelly absent) amendment #1 FAILED. Senator Parnell MOVED CS HB 199(FIN) and WITHOUT OBEJCTION it was REPORTED OUT with individual recommendations and accompanying fiscal note "All" ($652.5). He also noted the new fiscal note from the Alaska Court System in the amount of $55.7. The major difference was the savings reflected in the out years of the new Court fiscal note that were not reflected in the original published one. ADJOURNMENT Co-chair Torgerson recessed the committee until 9:00 a.m. and said he would hear bills previously scheduled/heard. SFC-99 (1) 5/18/99