Legislature(2003 - 2004)
2004-09-07 Senate Journal
Full Journal pdf2004-09-07 Senate Journal Page 3923 SB 65 Message dated and received July 22, stating: Dear President Therriault: On this date I have signed the following bill passed by the second session of the Twenty-third Alaska State Legislature. I am transmitting the engrossed and enrolled copies to the Lieutenant Governor's Office for permanent filing: HOUSE CS FOR CS FOR SENATE BILL NO. 65(FIN) "An Act relating to the qualifications of correctional officers, parole officers, and probation officers; authorizing the Department of Corrections to enter into lease-purchase 2004-09-07 Senate Journal Page 3924 agreements with municipalities for new or expanded public correctional facilities in the Fairbanks North Star Borough, the Matanuska-Susitna Borough, Bethel, the Municipality of Anchorage, and the City of Seward; relating to the development and financing of privately operated correctional facility space and services; authorizing the Department of Corrections to enter into a lease-purchase agreement with the City of Whittier for the confinement and care of prisoners in privately operated correctional facility space if the state cannot provide the same level of services required in state law or regulation for the same or less cost; giving notice of and approving, and authorizing the entry into and issuance of certificates of participation for, the upgrade, expansion, and replacement of certain jails in Dillingham and Kodiak; and providing for an effective date." Chapter 160, SLA 2004 Effective Date: 07/23/04 I have consistently supported finding a solution to the chronic problem of prison overcrowding in Alaska. Over a decade of gridlock has led to the failure to improve on what was supposed to be a temporary solution of sending prisoners to Arizona. The result has been the placement of more and more prisoners into community housing alternatives and the constant transferring of prisoners between locations to ensure the integrity of the system, all of which runs the risk of compromising the level of public safety being provided to Alaskans. Working with the Legislature, we have ended the gridlock. This bill will give the state the authority to address many needs, including both pretrial and long-term incarceration of criminals across the state. It will give the state the authority to pursue a large facility in the Mat-Su Valley, to reduce prison costs and ease the overcrowding in other areas. It will allow the state, subject to specified restrictions, to replace the Kodiak jail and the jail in Dillingham. It will also allow the state to expand the Anchorage Correctional Complex, if federal money becomes available. The expansions authorized in this bill will enhance the level of public safety afforded to the people of Alaska by providing a stable and adequate supply of prison beds to house those criminals who choose to victimize our citizens. 2004-09-07 Senate Journal Page 3925 And finally, this bill will generate good paying, long-term jobs for Alaskans and end the export of over $14 million per year to Arizona. In addition to my support of finding a solution to the prison overcrowding, I have consistently advised the Legislature that it should adopt a long-range fiscal plan for the State of Alaska. I believe the state needs to be on a solid financial footing before it authorizes a program of new borrowing that ultimately relies on the credit of the state. The state's credit has been under the cloud of a formal negative outlook by Moody's since August of 2002. The amount of debt authorized in this bill coupled with a lack of a long-range fiscal plan causes concern, the greatest of which is a potential negative effect on the state's credit rating. A downgrade of the state's credit could cost Alaska communities more each year in added interest. Even with petroleum revenues and one-time reserves paying state interest costs, Alaskans who pay property taxes to a city with debt, have a student loan, or have a home mortgage with a state agency would realize increased costs from a credit downgrade. A credit downgrade would be much like a hidden tax on Alaskans. I have made a commitment to the rating agencies that the state will not incur additional debt until recurring revenues match expenditures. I maintain that commitment and my signature of this bill is not an indication of our intent to immediately move forward with the $850 million in potential debt authorized in this legislation. I will still mandate that, before actual bonding or significant debt instruments can be issued, there must be a satisfactory repayment ability that will not jeopardize the state's AA bond rating. The responsibility to assure that the credit rating is not put in jeopardy is the joint responsibility of the Legislature and the administration. It is further understood that my administration, including the commissioner of Corrections and the State Bond Committee, will not initiate any action inconsistent with the state debt policy as articulated by the Office of the Governor. 2004-09-07 Senate Journal Page 3926 There are several provisions included in the bill that I will use to ensure my commitment is maintained. First, the bill provides the Department of Corrections the option to enter into lease-purchase agreements for new or expanded facilities. There is no mandate. Second, the authorization remains in effect until 2009. Third, lease- purchase agreements are subject to approval by the state bond committee made up of the commissioners of Revenue, Commerce, and Administration and the state bond committee will not approve debt that will result in a downgrading of the state's credit rating. Fourth, the bill restricts the Department of Correction's authority to sign lease- purchase agreements if any bonds issued for the projects would be rated below investment grade. Finally, certificates of participation authorized under the bill are restricted if the issuance would lower the state's credit rating and the certificates are rated below investment grade. I look forward to working with the Legislature and Alaskans to address the long-term fiscal needs of the state and the need to house our prisoners. Sincerely yours, /s/ Frank H. Murkowski Governor