1996-03-22                     Senate Journal                      Page 2838
SB 317                                                                       
An Act relating to the cost-of-living differential for                        
certain public employees residing in the state and                             
the criteria for determining eligibility for the                               
differential; and providing for an effective date.                             
                                                                               
was read the first time and referred to the Finance Committee.                 
                                                                               
Zero fiscal notes published today from Department of Administration,           
Department of Revenue, Department of Transportation and Public                 
Facilities.                                                                    
                                                                               
Governor's transmittal letter dated March 22:                                  
                                                                               
Dear President Pearce:                                                         
                                                                               
Under the authority of art. III, sec. 18, of the Alaska Constitution,          
I am transmitting a bill that would clarify how the state applies the          
cost of living pay differential for public employees.  This bill sets          
up a framework of eligibility criteria and defines state residency for         
the purpose of pay differentials which are required for certain public         
employees under collective bargaining agreements.  By codifying the            
states interpretation of the pay differentials, this legislation will help     
avoid conflicts and legal actions on this issue.                               
                                                                               
The state has been in disputes with employees of the marine                    
highway system over a definition of state residency and the                    
eligibility criteria for the pay differential.  Arbitrators have used          
different, and sometimes inconsistent, criteria in resolving the               
disputes.  Confusion over the criteria and whether it is subject to            
union bargaining has also led to court litigation.  This diverse               
situation has made it difficult to administer the differential program.        
                                                                               
This bill resolves most of the uncertainty in the program by applying          
the permanent fund dividend definition of state resident, which has            
been tested in court.  In addition, this bill authorizes the Department        
of Administration to adopt regulations to further clarify the criteria