Legislature(2025 - 2026)SENATE FINANCE 532
04/23/2025 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| Presentation: Department of Administration – Statewide Salary Study | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | HB 57 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
April 23, 2025
9:04 a.m.
9:04:36 AM
CALL TO ORDER
Co-Chair Stedman called the Senate Finance Committee
meeting to order at 9:04 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Donny Olson, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Mike Cronk
Senator James Kaufman
Senator Jesse Kiehl
Senator Kelly Merrick
MEMBERS ABSENT
None
ALSO PRESENT
Patrick Bracken, Senior Vice President, The Segal Group;
Mike Verdoorn, Vice President, The Segal Group; Richard
Ward, Senior Vice President and West region Public Sector
Director, The Segal Group; Senator Cathy Giessel; Paula
Vrana, Commissioner, Department of Administration; Camille
Brill, Acting Director, Division of Personnel, Department
of Administration.
SUMMARY
PRESENTATION: DEPARTMENT OF ADMINISTRATION STATEWIDE
SALARY STUDY
Co-Chair Stedman discussed the agenda. He noted that the
discussion on the topic of the statewide salary study had
started two years previously.
^PRESENTATION: DEPARTMENT OF ADMINISTRATION STATEWIDE
SALARY STUDY
9:06:46 AM
PATRICK BRACKEN, SENIOR VICE PRESIDENT, THE SEGAL GROUP,
introduced himself.
MIKE VERDOORN, VICE PRESIDENT, THE SEGAL GROUP, introduced
himself.
RICHARD WARD, SENIOR VICE PRESIDENT AND WEST REGION PUBLIC
SECTOR DIRECTOR, THE SEGAL GROUP, introduced himself.
Co-Chair Stedman suggested Mr. Bracken provide a company
profile and history of work in Alaska.
Mr. Bracken responded that the topics would be covered in
the presentation.
9:07:35 AM
Mr. Bracken discussed a presentation entitled "State of
Alaska Statewide Salary Study" (copy on file). He showed
slide 1, "Agenda":
• Study Overview
• Data Collection
• Methodologies
• Market Analysis Findings
• Recommendations
9:08:03 AM
Mr. Bracken looked at slide 2, "Study Overview about
Segal.":
National Consulting firm with 1,100+ employees,
celebrating over 80 years of serving clients.
Mission-driven:
Providing trusted advice that improves lives.
Independent, objective, and employee-owned
Not any solution
your solution; personalized advice and assistance
Mr. Bracken noted that his section worked solely with
public sector organizations. He noted that the Segal Group
was an employee-owned independent, and objective.
9:09:02 AM
Mr. Bracken spoke to slide 3, " Study Overview-Segal State
of Alaska Experience,":
Compensation and Classification Assessment (2012)
Diagnostic review of the classification and
compensation systems to provide recommendations for
review and potential future initiatives.
AlaskaCare consultants and actuarie (2012-present)
Employee Plan and Retiree Plan
Technical and strategic support
Collective bargaining support
Expert witness testimony
Segal has an office in downtown Juneau since 2019.
Mr. Bracken discussed Segals previous working relationship
with the state.
9:09:42 AM
Mr. Bracken referenced slide 4, "Study Overview-Segal
Experience,":
State of Delaware
• 16,200 employees covered by over 1,000 job
classifications.
• 155 benchmark job titles and distributed the survey to
13 peer employers including Federal and State
Governments, local governments (Delaware) and
published data sources to represent the private
sector.
State of Washington
Statewide Total Compensation Study
• 48,300 employees covered by over 1,500 job
classifications.
• 198 benchmark job titles and distributed the survey to
48 peer employers.
Department of Corrections
• Conducted a total compensation study for 12 job
classifications by distributing a custom survey to 7
peer employers.
Administrative Office of Hearings
• Ongoing total compensation study covering 5 benchmark
classifications.
• Distributed custom survey to 26 peers.
State of Rhode Island
• Conducted a comprehensive review of the current
personnel programs, practices, policies.
• Analysis of date and information related to recent
changes to the States pay and benefits.
• High-level review of the States classification
architecture and review of selected job series and
class descriptions
Oregon State Legislature
• 500 employees covered by 150+ job titles.
• Developed a pay equity analysis framework.
• Developed methodology to collect prior related work
experience.
• Conducted outlier analysis and advised on remediation
options.
State of Maine
• Developed updated classification structure and job
descriptions to reflect current functions and required
classifications.
• 100 benchmark job titles assessed across 10 peer
organizations and published survey sources
representing private sector.
State of New Hampshire Department of Administrative
Services
• 7 state police ranks and 100 job titles representing
other state employee categories.
• Identified the most appropriate comparators, which
included the other five county and city governments in
New Hampshire.
• For private sector data, we used well-respected
published sources of compensation and benefits data.
9:10:34 AM
Mr. Bracken turned to slide 5, " Project Roles and
Governance Structure
State Team
• Provides Segal with insights and advice related
to State strategic goals.
• Confirms and endorses project approach.
• Provides feedback and guidance on key decisions.
• Acts as liaison to Segal for project coordination
and execution
Segal Team
• Serves as compensation subject matter expert.
• Develops and manages the work plan and timeline.
• Responsible for collection, review, and analysis
of all market data
• Collaborates with the State Project Team to
complete comparative analysis and report
findings.
9:12:07 AM
Mr. Bracken considered slide 6, " Study Overview - Purpose
of the Study,":
The State of Alaska commissioned a Statewide Salary
Study to evaluate how the States pay plans compare to
other public and private sector organizations.
The study began in 2024 and included extensive data
collection from peer jurisdictions.
Segals goal was to gather high-quality, comprehensive
salary data, resulting in a dataset that exceeds
industry standards for compensation analysis.
The comparison focused on how the States pay
thth
structures align with the 50 and 65 percentile of
the market referred to as the identified market
competitive points.
Segals analysis provides a robust basis for
evaluating the State's ability to remain competitive
in attracting and retaining talent, with all the data
current as of January 1, 2025.
Co-Chair Stedman announced that Senator Olson had joined
the meeting.
9:13:44 AM
Mr. Bracken displayed slide 7, " Study Overview - Scope of
Study,":
This study provides a comprehensive assessment of the
competitiveness of the State of Alaska's salary
structures by analyzing 404 benchmark jobs, across
various job families, occupational groups, and
bargaining units. Key elements of the study scope
include:
• Market Comparison: Evaluated State salary structures
against public and private sector peers at both the
50th (market median) and 65th (market-leading)
percentiles. This salary structure comparison does not
analyze individual employee salaries.
Data Elements: All base pay compensation and health
insurance cost-sharing data effective as of January 1,
2025, and paid time off as of January 1, 2024.
• Base pay is defined as the published (or
formalized) salary structure pay grade range
minimum, midpoint, and maximum. It is considered
the direct compensation component of salary,
exclusive of any other pay related items such as
overtime, supplements, differentials, and pay
supplements etc.
• Purpose: The report does not recommend pay levels or
adjustments for employees, but equips State leadership
with data-driven insights to:
• Understand competitive pay gaps with market
conditions
• Compete effectively for skilled talent
• Manage pay structures and related costs
This scope provides decision-makers with a clear,
evidence-based foundation for future compensation
planning. The focus is on reviewing and analyzing the
States salary structures and does not include
evaluation or compensation of individual employee
salaries.
9:16:41 AM
Senator Kiehl pondered The Segal Group's approach of using
the published pay scale rather than looking at the actual
compensation that included overtime, premiums, and other
items. He reflected that the method was "clean" but
questioned whether it was realistic.
Mr. Bracken replied that the reason Segal looked at base
pay was that the experience of employees in terms of
availability for overtime, pay supplements, or other pay
related premiums varied dramatically within an
organization. To create as much of an apples-to-apples
comparison, he thought it was best to focus on elements
that were not variable.
9:18:20 AM
Senator Kiehl appreciated Mr. Bracken's explanation and
considered that employees considered how many hours they
would work in addition to an hourly wage. He wondered if
there was a way to consider any of the other factors such
as overtime pay, bonuses, and differentials when
considering how competitive the state was in the national
market.
Mr. Bracken noted that there were compensation studies that
attempted to consider those points. He thought that the
scope of the study, which had looked at 400 plus benchmark
jobs, would have been very challenging to provide that
level of information.
9:19:47 AM
Co-Chair Stedman asked whether Letters of Agreement had
been considered in the study.
Mr. Bracken replied that they had been provided base pay
information from the state and had not considered the
letters of agreement. He furthered that the group had
relied on the state to provide pay range information for
the benchmark classifications.
Co-Chair Stedman wondered about the pay ranges within the
Department of Corrections, which has an average base pay of
$100,000 per year, up to $300,00 and $400,000. He asked how
those values were handled.
Mr. Bracken explained that the values cited by Co-Chair
Stedman were compensation levels that an employee received
that included overtime and pay supplements. He reiterated
that the study only considered baes pay, and not
experiential compensation events. He said that
incorporating other states compensation premiums would
have proved too challenging for a study of this magnitude.
9:21:54 AM
Co-Chair Stedman relayed that when the committee had
considered commissioning a study of this nature there had
been concern that the base pay in some departments was too
low, which had resulted in high turnover and retention
issues. He continued that there was a significant number of
letters of agreement, and distortions within the Department
of Corrections that needed to be factored in when
considering the adjustment of pay scales. He stressed that
the work was to adjust the pay scales so that low pay at
the entry level, and exorbitantly high pay at higher levels
would be addressed so the states budget could be
sufficiently managed.
Mr. Bracken agreed to try and identify what the group was
able to conclude upon when discussing compensation.
9:23:51 AM
Mr. Verdoorn relayed that he would discuss data collection
efforts.
Mr. Verdoorn highlighted slide 8, " Data Collection -
Benchmark Jobs,":
State identified 404 benchmark classifications from
the 1,083 current classifications (Partially Exempt
and Classified) for inclusion in the market study.
404 Benchmark Classifications
Representation of all occupational groups and levels
throughout the organization
Highly populated jobs
Jobs found in most public sector organizations and
private sector (as applicable)
Jobs with recruitment or retention issues
He noted that the group had done its own due diligence in
looking at the benchmark jobs identified by the state. He
shared that the group had agreed with the jobs identified
and believed that they represented the 1,083, partially
exempt, classified positions within the scope.
9:25:36 AM
Senator Kiehl thought Mr. Verdoorn had remarked that the
400 benchmark jobs were "highly populated." He cited the
back pages of the report, which had listed some one-person
job classes.
Mr. Verdoorn noted that highly populated jobs were one item
that was identified as part of the study. He expanded that
in a study of this size it was inevitable that a few single
incumbent positions would be represented to ensure the
representation of certain occupational areas.
Senator Kiehl requested further clarification as to how the
job classes were chosen.
Mr. Verdoorn replied that various aspects and different
distribution charts were employed to identify benchmark
jobs. He noted that the study would end up finding some
jobs that were single incumbent positions. He noted that
the highly populated jobs most likely were a solid job that
would be found in another public sector organization.
9:28:09 AM
Senator Kiehl asked whether there were any jobs in the
study that currently had no employees.
Mr. Verdoorn did not recall finding a vacant class but
offered to get back to the committee with more information.
Co-Chair Stedman asked the testifiers to address the Alaska
Marine Highway System (AMHS) and the Masters, Mates, and
Pilots (MMP) and whether they compared those groups with
similar groups in Washington State.
Mr. Verdoorn noted that not all the peer organizations had
the same jobs, but the State of Washington had similar
marine type positions that were included in the survey.
9:29:19 AM
Mr. Verdoorn looked at slide 9, " Data Collection
Custom Survey,":
State Governments
Public Sector (City, Borough, District, ect.)
Private Sector (Local and industry labor market)
Federal Government
Survey Participation Summary
Public Sector
Surveyed 30
Completed Surveys 11
Data Mined 12
Total Responses 23
Response Rate 77 percent
Federal government
Surveyed 1
Completed Surveys 0
Data Mined 1
Total Responses 1
Response Rate 100 percent
State governments
Surveyed 14
Completed Surveys 11
Data Mined 3
Total Responses 14
Response Rate 100 percent
Private sector (see note)
Surveyed 23
Completed Surveys 4
Data Mined 0
Total Responses 4
Response Rate 17 percent
Total
Surveyed 68
Completed Surveys 26
Data Mined 16
Total Responses 42
Response Rate 62 percent
Note: Private sector organizations typically do not
respond to custom survey due to anti-trust concerns or
other data privacy restrictions. However, Segal
included specific private sector employers in the
custom survey process in an attempt to broaden the
compensation data set. The low response rate of
private sector employers to custom survey is not
unexpected and why Segal bolsters the analysis with
the published survey sources.
9:29:49 AM
Mr. Verdoorn addressed slide 10, " Data Collection -
Published Survey Additional Data Sources,":
Segal utilized the following published survey sources
to represent the public and private sector for the
States benchmark jobs:
Private Sector Sources
CompAnalyst (Salary.com)
CompAnalyst Market Data, a subscription database
maintained by Salary.com, includes pay data from
hundreds of professionally conducted employer-provided
surveys. For this analysis, we used All Industries,
Anchorage, AK base salary data.
Economic Research Institute (ERI)
ERI's Salary Assessor and Executive Assessor databases
aggregate pay data from hundreds of published data
sources for thousands of job titles. The data is
updated quarterly and provides salary information for
nearly any geographic area in the U.S. For this
analysis, we used All Industries, Anchorage, AK base
salary data.
PayFactors
PayFactors' Survey of Surveys is a compensation
database that compiles pay data from published data
sources and HR departments. PayFactors updates their
data constantly and provides salary information for
most geographic areas in the U.S. For this analysis,
we used All Industries, Anchorage, AK base salary
data.
Milliman Alaska Compensation Survey
Milliman publishes annual surveys gathering data on
compensation and benefit trends in specific regions or
industries and includes nonexempt, professional and
management positions compiled from major employers
within Anchorage, Fairbanks, Southeast, &
Northern/Western Alaska. For this analysis, we used
private sector and Anchorage, AK base salary data.
Mr. Verdoorn turned back to slide 9 and noted that the
survey was represented on the fourth line of the table. He
elaborated that there had been 23 surveys sent out to
private sector firms and 4 firms had responded. He said
that the other survey sources represented the private
sector as a proxy. He noted that the 77 percent response
rate exceeded expectations.
9:32:22 AM
Co-Chair Hoffman noted that Alaska was unique in its
employment compared to other states and cited the many
tribal corporations that had revenues of over a billion
dollars. He noted that Alaksa Native Health Corporations
also employed many Alaskans. He asked whether those
employees were considered public or private.
Mr. Verdoorn relayed that he needed to consult with his
colleagues and get back to the committee.
9:33:42 AM
Senator Kiehl asked how the group adjusted the broad
national private sector data and some of the collected
Alaska data. He thought the state was unique and had fewer
governmental units. He used the example of the City and
Borough of Juneau, which tried to keep up with the state on
salary. He asked how to avoid having a circular reference
in the data.
Mr. Verdoorn reflected on the robustness of the data set,
and whether it was insular in comparison. He noted that
other published survey sources had been cited including on
the federal level. He thought with 68 participants it far
exceeded a typical approach for a public sector survey. He
relayed that following slides would discuss some
adjustments that were used in the methodology.
9:37:03 AM
Mr. Verdoorn continued to address slide 10:
Public Sector Source
Segal Public Sector Compensation Database Represents
recent Segal compensation studies conducted across the
United States over the past two (2) years, salary base
pay range data from public sector organizations
representing 400+ organizations and 14,000 participant
job match titles, geographically adjusted using a cost
of labor factor to Anchorage, Alaska.
9:37:56 AM
Mr. Verdoorn advanced to slide 11, " Methodologies - Data
Adjustments:
Data Aging Factor
Annual Aging Factor:4.0 percent
Reflects trends from:
• National & Alaska labor markets
• All industries (Public Admin, Oil & Gas,
Utilities)
• Actual salary & structure increases
Based on multiple sources:
• WorldatWork Salary Budget Survey
• Bureau of Labor Employment Cost Index
• NCASG & Milliman Surveys
Cost-of-Labor Adjustment Factor
All salary data were adjusted to reflect Anchorage, AK
as the base labor market.
Adjustments used Economic Research Institute (ERI)
cost-of-labor differentials for peer locations.
A positive adjustment indicates that the comparator
location has a lower cost of labor than Anchorage.
Example: Colorados cost of labor is lower adjusted
up by 109 percent to match Anchorage.
Workweek Adjustments
FLSA non-exempt positions adjusted to align with States
37.5 or 40-hour workweek.
Ensures consistent comparisons across employers with
different standard hours.
FLSA Exempt (salaried) positions were not adjusted, as they
typically work beyond standard hours.
9:40:51 AM
Mr. Verdoorn looked at slide 12, " Methodologies - Market
Analysis Process:
Job Matching Process
• Matches based on overall comparability to State
benchmark job summaries.
• 100 percent matches are rare due to differences in
size and structure.
• Applied the 75 percent rule: work and
qualifications must be largely similar.
• Broad/narrow roles excluded if not a true match.
Data Sufficiency & Job Inclusion
• Segal followed U.S. Department of Labor Safe Harbor
Guidelines
• Benchmark jobs needed at least 5 peer matches or a
published survey match.
• Jobs not meeting this threshold were excluded from
competitiveness analysis.
• 384 of 404 benchmark jobs met data sufficiency
requirements.
Quality Control Methods
Job Matching & Survey Review:
• Peer outreach for validation
• Review of peer job descriptions
Market Analysis:
• External Segal analytical staff performed
thorough quality review of data, formulas, and
analysis approach.
9:43:41 AM
Mr. Verdoorn showed slide 13, " Methodologies - Market
Competitiveness,":
Market Competitiveness Corridor
• Segals Competitiveness Corridor defines pay
comparisons relative to identifies market competitive
point.
• A 100 percent comparison means the State is equal to
th
the identified market competitive point (e.g., 50 or
th
65 percentile).
• Competitive range is defined as 95 percent to 105
percent of the identified market competitive point.
Mr. Verdoorn said that future slides would have color coded
identifiers for where job classes fell in the overall
market.
9:44:51 AM
Senator Kiehl asked for assistance with data. He considered
the bell curve and asked what the 95 percent and 100
percent represented.
Mr. Verdoorn used the example of a benchmark job with a
salary range midpoint of $50,000. If the state was
currently paying $49,000 for that same class, the sate
would be within the 95 percent or 105 percent competitive
range.
Senator Kiehl understood the distribution of the bell curve
could cover both many, and few, job classifications.
Mr. Verdoorn replied in the affirmative.
9:46:36 AM
Mr. Verdoorn referenced slide 14, "Methodologies
Percentiles," and addressed percentiles in market data. He
explained that in the 50th Percentile (Median), half of
data points are above, half are below. For the 65th
Percentile, the data points were higher than 65% of the
market, lower than 35 percent. He noted that percentiles
reflected position, not the percentage of difference (e.g.,
65th ? 15percent above 50th).
Senator Kiehl asked if why the percentiles were the correct
why it was a better choice to consider dollars rather than
the labor market.
Mr. Verdoorn said that the idea of the 95 percent to 105
percent market corridor looked at the competitive point and
was easily used across all jobs.
Senator Kiehl asked why the methodology was the standard.
9:49:52 AM
Mr. Bracken offered to provide additional context and went
back to slide 13. He said that for the state to understand
which jobs were in the competitive corridor, a bracket had
been created. He said that oftentimes a 5 percent
difference in paygrades was recommended when crafting a pay
scale.
9:51:35 AM
Mr. Verdoorn turned to slide 15, " Methodologies - State
Salary Range Assumptions/Usage/Points
During discussions with the State, it was determined
that the State's range minimum, midpoint, and maximum
will represents the followings steps:
1. The Alaska State range minimum represents Step A,
except for bargaining unit TA the state pay range
minimum represents Lane 1, Step 1.
2. The Alaska State pay range midpoint represents Step
F, except for the following bargaining units: Step E
for bargaining unit SS, Step J for bargaining unit
LL, and Lane 1, Step 3 for bargaining unit TA.
3. The Alaska State pay range maximum represents Step
O, except for bargaining unit TA, where the state
pay range maximum represents Lane 4, Step 1.
Senator Kiehl looked at the chart on slide 15 and observed
that it looked as though 65 percent of the people on the
chart were below the midpoint. He asked how the midpoint
could have 65 percent of the jobs below it.
Mr. Verdoorn relayed that those were where individual
employees were placed. In most instances, the formalized
structure went from the minimum to the midpoint and then
people progressed beyond that.
Senator Kiehl thought the point was an inflection point
rather than a midpoint.
Mr. Verdoorn agreed that it could be interpreted as an
inflection point and that the state did not have a true
formalized midpoint.
9:54:45 AM
Mr. Bracken Mr. Verdoorn considered slide 16, "Market
Analysis Findings - Overall Salary Structure Comparison."
He explained that the table was a high-level comparison
across all benchmark jobs. The top left portion of the
table showed the public sector custom survey, which
signified that the date related to the survey that had been
given to public sector employers. For comparison points the
analysis was broken out to compare Alaska pay ranges to the
public sector, the private sector, published data sources,
and an overall combined basis.
Mr. Bracken repeated information regarding color coding
that identified comparison points. The red showed below
market, which was defined as less than 95 percent of the
market competitive point. Figures in black were market
competitive. Figures in blue were above market. He wanted
to focus on the last row, which showed overall combined pay
range minimums, midpoint, and maximums had all been marked
competitive. However, when compared to the 65th percentile,
they were below market.
Mr. Bracken highlighted there was variability at the
benchmark level and at other grouping levels, but when
considering all the date collected there were the findings.
9:57:54 AM
Mr. Bracken displayed slide 17, " Market Analysis Findings
- Overall Salary Structure Comparisons," which showed more
th
detail of the comparisons, the 50 percentile at the top
th
and the 65 percentile at the bottom. He relayed that the
Segal Group has concluded that the minimum comparison of
the salary structure showed that 72 percent of employees in
th
benchmark jobs were at, or above market compared to the 50
percentile market competitive point. He furthered that 57
percent of employees were in benchmark jobs that were at,
th
or above market compared to the 65 percentile of the
market data.
9:59:07 AM
Mr. Bracken highlighted slide 18, " Recommendations
Establish a Compensation Philosophy: Develop a guiding
strategy for compensation Align principles across job
families and bargaining units.
Redesign Salary Structures: Group by occupational
families Define min, midpoint, and max for each range
Ensure consistent range spreads and midpoint
differentials Align ranges to market benchmarks and
pay progression.
Improve Salary Structure Administration: Streamline
through occupational-based frameworks Reflect
supervisory differentials and incentive pay best
practices.
Implement Structure Maintenance: Conduct market
studies every 3 years Match jobs based on duties, not
titles Define labor markets by occupational group.
Modernize Classification Structure: Introduce internal
job evaluation methodology Review and streamline job
classes Schedule regular updates to maintain
relevance.
10:03:17 AM
Senator Kaufman was curious about compensation philosophy
and asked whether Mr. Bracken knew of any examples of key
elements of compensation philosophies. He wondered whether
the public sector should seek to be the premier employer at
the expense of the private sector.
Mr. Bracken relayed that there were a variety of frameworks
for compensation philosophies. What the group had found was
that the employee value proposition included compensation,
benefits, pay transparency, pay communication,
organizational infinity, and mission drive. When working
with clients to develop compensation philosophies the
construction of how those components were defined is unique
to the organization. He offered that the State of
Washington had a market leading compensation philosophy.
10:06:31 AM
Senator Kiehl understood that at the low end of the pay
scale for state employees the pay was comparable to the
private sector and was made more attractive by the value of
the health insurance. He wondered whether this was still
the case.
10:07:57 AM
Mr. Ward referenced page 36 of the document "Statewide
Salary Study Report" (copy on file). The page summarized
the value of health benefits for the employee plan in
Alaska Care compared to other state and private entities.
He shared that the state benefits were comparable to other
public sector entities, which included states, local
governments, and school districts nationwide. He noted that
the state net benefits were greater than that of the
private sector. He noted that like the compensation data
the health benefits data was adjusted for geography and for
timing of data collection.
Senator Kiehl asked how often the $3,000 delta between the
state and the average private sector lower positions was
considered.
10:10:37 AM
Mr. Bracken considered the combination of health
information and the pay information and thought
consideration of the state's provision of two market
identified points for comparison, it was important for the
state to consider the relevancy of those points before
thinking about how to contextualize the construct of those
market identified reference points.
10:11:35 AM
Co-Chair Hoffman recognized that there were representatives
from the Department of Administration available for
questions.
Senator Kiehl agreed with the Segal Group recommendations
to modernize the classification system. He queried the
holistic benefit to the state of modernizing the system.
Mr. Bracken thought it was accurate to portray the overhaul
of the classification structure as a monumental effort. He
pondered that the benefits of a rewrite were many,
beginning with clarity in the equity of how paygrades were
determined. He thought that when job functions were clearly
defined and mapped to the salary structure,
reclassification requests would reflect work more
accurately and be more easily administered. Additionally,
at a high level an improved classification structure helped
with the attracting of the right individual for the roles
being advertised.
10:14:44 AM
Co-Chair Stedman thought that much of the meeting had been
spent discussing how the study was created but very little
time on the substance of the report. He requested that the
report appendix be submitted in Excel form so that members
could identify weak areas and scrutinized the data. He
noted that the slides had not offered any detail about what
was in the study. He asked for detail concerning the low
and high points in state salary ranges.
Mr. Bracken noted that the report had more detailed
information at the benchmark job level. He thought it might
be difficult for the viewing public to see the information.
The study showed different breakdowns of benchmark job
comparisons by occupational group.
Co-Chair Stedman asked Mr. Bracken to paraphrase some of
the data for the public.
10:17:45 AM
Mr. Bracken identified that when some comparisons were
broken down there had been 12 state defined occupational
groups. He used the example of four occupational groups
that were consistently below market: executive and senior
administrators, education and information libraries and
museums, and biological sciences and physical sciences and
engineering. Conversely, police, firefighters,
corrections, and craftwork and labor were consistently at
or above market.
Co-Chair Stedman asked for help with lower-level employees
dealing with health and human services.
Mr. Bracken believed that the group would have to get back
to the committee with a more detailed breakdown of the
group.
Co-Chair Stedman queried whether and committee members had
areas they would like specifically reviewed.
10:19:36 AM
Senator Kiehl wanted to understand the attorney's group and
wondered whether the positions had been compared to private
sector billable hours or a hypothetical 40-hour work week.
Co-Chair Stedman relayed that anything to do with
corrections would be helpful.
10:20:06 AM
Senator Cronk asked whether geographical differences were
considered in any part of the study.
Mr. Bracken replied that all the data was adjusted to
geographically reflect Anchorage as the location.
Co-Chair Stedman thanked the presenters.
Co-Chair Stedman thought there were concerns with agency
pay scales. He questioned the administrations next steps
in the matter.
10:22:07 AM
PAULA VRANA, COMMISSIONER, DEPARTMENT OF ADMINISTRATION,
relayed that the next steps for the administration was to
develop a project plan to modernize and streamline the
classification system. The department would review by job
family to consider whether a salary adjustment was
warranted, beginning with job families that include
benchmark jobs 10 percent or more below market.
10:22:58 AM
CAMILLE BRILL, ACTING DIRECTOR, DIVISION OF PERSONNEL,
DEPARTMENT OF ADMINISTRATION, expressed excitement for the
next steps. She said that she was looking forward to
modernizing the classification system to effect
transformational change in recruitment and retention. He
noted an administrative order recently issued that required
skills-based hiring. She said that the Segal report would
be studied in detail. She noted that four class studies
experts would be reviewing the recommendations. She said
that they would begin by looking at the job classed that
were 10 percent under market, which was 37 percent of jobs.
10:25:25 AM
Co-Chair Hoffman thought high-end jobs should also be
considered, and what actions the state was taking to
scrutinize the salaries at the highest end.
Ms. Brill affirmed that the department wanted to begin to
focus on extremes. She commented that the study was a
robust data set but was not individualized. She emphasized
that the state had 12 occupational groups, within those 12
groups were 72 job families, within those job families 183
job classes. Getting further into the details of the study
will help to provide good data for good decision making.
10:27:55 AM
Co-Chair Hoffman asked how the study was affecting the job
negotiations that were taking place. He mentioned expected
possible substantial pay increases for certain groups.
Commissioner Vrana noted that the impact of collective
bargaining would be considered and incorporated into the
details of next steps. The study did not consider
collective bargaining.
10:29:07 AM
Co-Chair Stedman agreed with Co-Chair Hoffman that the pay
scale of the state was top heavy and light on the bottom.
He noted that this discussion had been ongoing for decades.
He asked about teacher salaries. He spoke of the
constitutional obligation the state had to fund education
and wondered how teacher salaries would be considered in
the salary review.
Ms. Brill noted that the study focused on executive branch
employees.
Co-Chair Stedman understood teachers were not executive
branch employees but believed that at the end of the day
all salaries conversations came back to the committee. He
felt it was important to consider low salaries as a reason
for abysmal teacher retention in the state.
10:31:41 AM
Co-Chair Hoffman relayed that there were teachers at Mount
Edgecumbe High School (MEHS) and asked where those teachers
fell on the pay scale.
Ms. Brill had not specifically looked at teacher salaries
at MEHS. She said she planned to investigate those
salaries.
Co-Chair Stedman believed that would be helpful data to
examine. He asked whether the state planned to use 50
percent or 65 percent market point.
Commissioner Vrana relayed that the decision had not yet
been made.
Co-Chair Stedman assumed that one of the percentages would
be used.
Commissioner Vrana relayed that it was too early to say at
this point which percentage would be used.
Co-Chair Stedman asked when the committee to expect
detailed next steps.
Commissioner Vrana relayed that the depamrent would be
working diligently and hoped to get back to the committee
with a status report the following session.
Co-Chair Stedman suggested that the operating budget might
include language expecting a report by January 2026. He
considered the matter would carry significant financial
impact to the state.
10:33:57 AM
Senator Kaufman hoped for a job classification spreadsheet
that was presented in a colorful and easily interpreted
visual aid.
Co-Chair Stedman thought it was good to remember that the
public needed to understand the significance of the impact.
He emphasized that receipt of the report by January 2026
would be best and along with visual aids that would be
easily interpreted by the public.
10:35:30 AM
Senator Cronk considered geographical differences and hoped
that those differences would be considered in the
administrations work.
Ms. Brill thought the last geographical differential study
was done in 2008, before which was in 1995. She said that a
new geographical study would require an appropriation.
Co-Chair Stedman said an appropriation could be requested
through the budgetary process. He commented that it was
difficult for the committee to put an appropriation and
command the administration to do something.
10:37:41 AM
Senator Kiehl expressed confusion about whether Information
Technology job classes were in the study. He referred to
slide 17 and asked about the cost of implementation.
Commissioner Vrana relayed that the administration had a
rough estimation of $93 million at the 50th percentile. At
the 65t percentile, the cost estimate was $180 million.
Co-Chair Stedman noted that the cost would be ongoing. He
thanked the commissioner for her testimony and looked
forward to the data sets in Excel form.
Ms. Brill noted that all the data sets were included on the
department's webpage.
Co-Chair Stedman discussed housekeeping.
ADJOURNMENT
10:41:37 AM
The meeting was adjourned at 10:41 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 042325 DOA Support Doc SalaryStudyFAQsheet.pdf |
SFIN 4/23/2025 9:00:00 AM |
|
| 042325 FINAL 2025 Segal Compensation Study Alaska State Legislature April 2025.pdf |
SFIN 4/23/2025 9:00:00 AM |
|
| 042325 DOA Support Doc SalaryStudyFullReport.pdf |
SFIN 4/23/2025 9:00:00 AM |
|
| Public Testimony - Segal Salary Study and SOA Information Technology Classification Study.pdf |
SFIN 4/23/2025 9:00:00 AM |