Legislature(2013 - 2014)HOUSE FINANCE 519
01/29/2013 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| Fy 14 Governor's Budget Overview: Alaska Mental Health Authority | |
| Fy 14 Governor's Budget Overview: Department of Administration | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 65 | TELECONFERENCED | |
| += | HB 66 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
HOUSE BILL NO. 65
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs, capitalizing funds, amending
appropriations, and making reappropriations; and
providing for an effective date."
HOUSE BILL NO. 66
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
^FY 14 GOVERNOR'S BUDGET OVERVIEW: ALASKA MENTAL HEALTH
AUTHORITY
1:32:52 PM
MIKE BARTON, TRUSTEE, ALASKA MENTAL HEALTH TRUST AUTHORITY,
introduced various members of the Alaska Mental Health
Trust Authority. He pointed out that the first subcommittee
meeting was scheduled for February 18th.
Mr. Barton introduced slide 2: "Trust Beneficiaries."
· People with mental illness
· People with developmental disabilities
· People with chronic alcoholism and other substance
related dementia
· People with traumatic brain injury
1:36:58 PM
Mr. Barton discussed slide 3: "Guiding Principles."
· To improve the lives of Trust beneficiaries, The Trust
is committed to:
o Education of the public and policymakers on
beneficiary needs;
o Collaboration with consumers and partner
advocates;
o Maximizing beneficiary input into programs;
o Prioritizing services for beneficiaries at risk
of institutionalization;
o Useful and timely data for evaluating program
results;
o Inclusion of early intervention and prevention
components;
o Provision of reasonably necessary beneficiary
services based on ability to pay.
PAULA EASLEY, SECRETARY/TREASURER, BOARD OF TRUSTEES,
ALASKA MENTAL HEALTH TRUST AUTHORITY, explained that the
scorecard was assessed annually since 2008. She stated that
a comparison of last year and this year displayed the
effective determination of figures and how key issues were
impacting beneficiaries. The information was carefully
refined.
Mr. Barton offered to provide a copy of the scorecard to
the committee.
Mr. Barton discussed slide 4: "Trust Advisors and
Partners."
· Advisory Board on Alcoholism & Drug Abuse
· Alaska Mental Health Board
· Governor's Council on Disabilities & Special Education
· Alaska Commission on Aging
· Commissioners of Health and Social Services, Revenue,
Natural Resources and Corrections
· Alaska Brain Injury Network
· Statewide Suicide Prevention Council
1:40:27 PM
Mr. Barton discussed slide 5: "Trust Funding FY 14." He
noted that the great bulk came from the fund pay-out. The
trust fund payout at 4.25 percent equaled $18,090,000. The
payout was based on a four-year average principal and
reserve balances of $426 million.
1:41:30 PM
Mr. Barton detailed slide 6: "The Trust Resource
Portfolio." He explained that the trust had approximately 1
million acres of trust land that was the result of a
settlement. The acres were divided by region. The trust had
full fee ownership for 55 percent of the land. The trust
owned coal, oil and gas rights for one third of the land
and full mineral rights for 11 percent. The Trust Land
Office (TLO) contributed a total of $138 million since 1994
when the settlement was achieved.
1:43:03 PM
Mr. Barton detailed slide 7: "Formula for Success."
· Committed partners + Strategic thinking = Results for
Trust beneficiaries
o Identify a problem or community need
o Collaborate with governmental agencies, advisory
groups, nonprofits, service providers,
philanthropic organizations and private sector
o Develop strategic, sharply focused solutions
o make lasting system improvements
Mr. Barton explained slide 8: "Five Program Focus Areas."
· Bring the Kids Home
o reforming Alaska's mental health care for
children and adolescents so they are diagnosed
earlier and treated as close to home as possible
· Disability Justice
o reducing the involvement and recidivism of Trust
beneficiaries in the criminal justice system
· Affordable Appropriate Housing
o increasing a continuum of housing options for
Trust beneficiaries
· Workforce Development
o creating an available and competent workforce for
Trust beneficiaries and service providers
· Beneficiary Projects Initiative
o supporting grassroots, peer-to-peer programs for
Trust beneficiaries
1:45:42 PM
Mr. Barton detailed slide 9: "Alcohol Initiatives."
· Recover Alaska
o initiative lead by Rasmuson Foundation, includes
The Trust, Mat-Su Health Foundation, DHSS and
other stakeholders
o goal to help individuals, families and
communities in Alaska "recover" from impacts of
alcohol
o focus on systems, policy, statutory and practice
changes that will lead to long-term improvements
· Title 4 review
o partnership with Alcohol Beverage Control Board,
which is convening stakeholders to review and
possibly recommend changes to Alaska's alcohol
beverage control statutes in Title 4.
1:46:29 PM
JEFF JESSEE, CHIEF EXECUTIVE OFFICER, ALASKA MENTAL HEALTH
TRUST AUTHORITY, detailed slide 10: "Bring the Kids Home."
· Problem
o FY 06: 743 Alaskan children with severe emotional
disturbances received out-of-state residential
psychiatric treatment services
ƒseparated from families and communities
ƒdifficult transitions back to Alaska
ƒlength of stay varied from several months to
multiple years
ƒcosts peaked at $40+
· Committed partners
o DHSS, behavioral health service providers, parent
and youth advocates, Trust partner boards, Alaska
Native health providers, Dept. of Education,
Denali Commission and others
· Strategic thinking
o intervene earlier, more intensively, and with the
family
o use residential resources carefully
o expand implementation of effective practices
o develop in-state treatment for youth with complex
needs
1:49:19 PM
Mr. Jessee detailed slide 11: "Results for Beneficiaries."
Less than 100 Alaskan children were located in out of state
facilities. He noted that the recidivism rate was reduced
from 20 percent to 5 percent. The 15 percent reduction
translated into significant savings to the state,
particularly with the Medicaid program.
Mr. Jessee discussed slide 12: "Shifting Expenditures in
State." He explained that the Bring the Kids Home
initiative was a reinvestment strategy. He noted that the
reduction of the out of state Residential Psychiatric
Treatment Centers (RPTC) costs was expected. He stated that
a continuation of the path would have doubled the $40
million spent out of state.
1:51:55 PM
Mr. Jessee discussed slide 13: "Results for Beneficiaries."
· Developing in-state treatment options for children
with co-occurring and complex disorders
o Complex Behaviors Collaborative
o in-state RPTC unit
o resources for youth who experience FASD
Mr. Jessee stated that some kids would always travel out of
state for specialized programs because the AMHT could not
provide for every need. He stated that children with
intellectual disabilities and serious emotional
disturbances typically left the state for an average of 400
days. He spoke about an in-patient treatment program that
was closely tied to community based family services that
took the same population and reduced the average length of
stay to between 45 and 90 days. The trust funded a group of
Alaskans from both the state department and providers to
review the program. He stated that North Star, a core RPTC
program in Anchorage, believed that they could duplicate
the program. He worked with community providers to
integrate the necessary level of care. The Bring the Kids
Home initiative was winding down allowing the Trust to
focus on other areas. Indicators would be in place to alert
the Trust and the legislature if the numbers began to rise.
Mr. Jessee discussed slide 14: "Results for Beneficiaries."
· Working with young children to prevent severe
disturbances
· Working with families to keep/return children to their
homes
o expanding early childhood services
o increasing delivery and quality of family therapy
services
o expanding trauma training
Mr. Jessee informed the committee that most of the kids
exhibiting serious issues were multiply traumatized. He
commented on Adverse Childhood Experiences (ACE) and the
effect on children and adults. A direct correlation existed
between a child's negative experiences and their need for
exceptional care. He spoke about Department of Health and
Social Services and the Department of Corrections budgets
and the need to contain them. He spoke to targeting funds
appropriately by intervening in children with multiple ACE.
He mentioned research to offset the negative experiences
such as mentoring with adults. He stated that AMHT would
continue to monitor ACE scores to focus prevention efforts
to enable a long-term sustainable plan for the state
budget.
1:58:30 PM
Mr. Jessee discussed slide 15: "Ahead in FY 14." He noted
the incorporation of Mental Health Traits Authority
Authorized Receipts (MHTAAR). He mentioned that the
authority grants were made directly by the trust authority
that was not processed through state government. He noted
the importance of education because the schools provided an
early-warning system for kids beginning to have difficulty.
The trustees recommended a one-to-one match between trust
funding for FY 14 and general funds. He stated that the
governor's budget reduced the state match for evidence
based family therapy models from $600 thousand to $270
thousand.
2:00:43 PM
Mr. Jessee informed the committee that evidence based
family therapy was the most cost effective strategy to
prevent future issues.
Mr. Jessee discussed slide 16: "Looking Toward FY 15."
· FY 15 BTKH increments, if any, will transition on-
going successful projects from MHTAAR to GF/MH for
long-term sustainability
· BTKH efforts will continue, using existing GF/MH
resources to sustain planning and to maintain and
build on success
· The AMHT believes further progress will require a
shift in focus to earlier intervention, prevention and
family-based services to decrease long-term costs for
behavioral and health while improving outcomes for
children and families.
Mr. Jessee discussed slide 17: "Disability Justice." He
recommended a shift of focus from symptoms of a poorly
designed system to focus on early intervention and
prevention. He stated that 43 percent of youth in the
juvenile justice system were trust beneficiaries, as were
42 percent of people in Department of Corrections (DOC). He
expressed concern that beneficiaries in both systems had
higher rates of recidivism.
2:02:35 PM
Mr. Jessee discussed slide 19: "Strategic Thinking."
· Prevent and reduce inappropriate or avoidable arrest,
prosecution, incarceration and criminal recidivism of
juvenile and adult AMHT beneficiaries
· Increase criminal justice system's ability to
accommodate, support, protect and provide treatment
for victims and offenders who are AMHT beneficiaries
· Reduce use of jails and prisons to provide protective
custody of adult AMHT beneficiaries under Alaska
Statute 47.37.170 (protective custody hold)
· Improve community re-entry planning from juvenile
detention and treatment, and adult correctional
facilities back into Alaska communities.
2:04:06 PM
Mr. Jessee discussed slide 20: "Outcomes Driven Results."
· Working together state, local agencies save lives,
improve public safety
o 75 percent reduction in non-criminal Title 47
protective custody holds at Yukon Kuskokwim
Correctional Center from 2010-2012
o Individuals screened, referred to appropriate
treatment
· Therapeutic Courts
o Juneau Mental Health Court opened May 2012
o Anchorage Mental Health Court combined savings
almost 2.5 times program annual operating cost
(293,000)
2:06:46 PM
Mr. Jessee discussed slide 23: "Affordable Appropriate
Housing." He commented on recent discussions regarding the
safety of people with mental health issues. He resisted
enforcing the stigma that mentally ill people were more
dangerous than anybody else. Statistically, mentally ill
people are not more violent, although they are more likely
to be victims. He stated that the lack of safe, affordable
housing was the largest challenge facing beneficiaries. He
pointed out the chart on slide 23 detailing that a person
receiving a state supplement earned approximately $12
thousand per year. He added that a person working a minimum
wage job earned $16 thousand. A studio apartment in Alaska
required an income of $28 thousand. Historically, a
dividend was taken from Alaska Housing Finance Corporation
(AHFC) and not returned into the housing industry, but
instead placed in the general fund for appropriation.
2:09:33 PM
Mr. Jessee discussed slide 24: "Committed Partners."
· Alaska Council on the Homeless: Alaska Housing Finance
Corporation, the departments of Health and Social
Services, Corrections, Labor and Public Safety, and
the Veterans Administration.
· Housing development organizations
· Social service agencies
· Local affordable housing and homeless coalitions
· Private business owners
Mr. Jessee discussed slide 26: "Strategic Thinking."
· Adapting programs for sustainability - replicating
successful strategies through AHFC
o Special Needs Housing Grants (SNHG)
o Homeless Assistance Program (HAP)
· Collaborating on creating "no wrong door"
o coordinating services statewide through homeless
coalitions
o assessment of housing barriers
· Collaborating on creating "no wrong door"
o DHSS Divisions of Behavioral Health and Senior
and Disability Services
o Assess needs by region and beneficiary group
· Effective program models implemented
o Trust/DHSS/AHFC collaboration on HUD pilot
(reducing General Relief participants through
supported housing)
o program development: Bridge Home and more
intensive community outreach models
Mr. Jessee discussed slide 27: "Results for Beneficiaries."
· Working the Plans
o Alaska Council on the Homeless Ten-Year Plan,
Anchorage Ten-Year Plan on Homelessness, other
community plans
· Replicating Housing First
o targeting the most vulnerable and costly homeless
· Anchorage and Fairbanks on-track to replicate Outside
results:
o Seattle decreased drinking by 30 percent and
reduced costs by $4 million in 12-month period.
o Anchorage tenants are becoming stable - 78
percent retention compared to 80 percent in
similar programs
· Karluk Manor phase II - expansion and design
improvements
o working with Municipality of Anchorage to
identify land to relocate
o new facility will allow more individuals to be
served and will create space and staffing
efficiencies
· New projects under consideration: Anchorage, Juneau,
Nome
2:11:22 PM
Mr. Jessee discussed slide 28: "Ahead in FY 14"
· Policy - Governor's Council on the Homeless
o state interagency collaboration modeled on
federal agencies
ƒ10-year homeless plan and budget
recommendations being implemented
· Budget - $10 million annual recommendation for 10-year
plan ($8 million allocated)
o The Trust, AHFC, GF/MH and other funding sources
· Effective program models implemented
o Trust/DHSS collaboration to serve most
challenging individuals cycling through API and
DOC (Bridge Home and more intensive community
outreach models)
o replicating Housing First for beneficiaries who
are chronically homeless with alcohol addiction
and low income people with disabilities
o services located on-site using housing projects
large enough to make programs sustainable and
robust
· Long-term care strategic planning for Alaska
o planning that makes use of right resources at
right time
o continuum of care for people with disabilities,
Alzheimer's disease and related dementia.
Mr. Jessee stressed that the lack of housing opportunities
in the state affect many different departments. He planned
to work with various subcommittees on the issues.
2:12:31 PM
Mr. Jessee discussed slide 30: "Workforce Development."
· Problem
o growing need for workforce to serve Trust
beneficiaries, especially Alaskans 65+ (fastest
growing population segment)
o high vacancy rates in many health care jobs
o high turnover, especially in rural areas
ƒmany are temporary workers from Outside
ƒlack of housing
o lack of in-state training/education for some
fields
o lack of continuing education required for
licensure and certification for some professions
Mr. Jessee detailed slide 31: "Health Care Job Growth."
· 38,749 new jobs in all Alaska sectors
o 12 percent increase from 2010-2020
· Health care and social service jobs expected to grow
31 percent by 2020 or one-third of total job growth
· Ambulatory health care - practitioners, outpatient
care, home health services - will gain 5,860 jobs or
28 percent increase by 2020
· Alaskans age 65+ expected to increase 89 percent by
2020, contributing to rising demand for health care
workers
· Aging population will boost social service sector,
adding about 2,400 jobs, up 25 percent by 2020
2:13:34 PM
Mr. Jessee highlighted the necessary partnerships in slide
33: "Alaska Health Workforce Coalition."
· Core Team
o The Trust, departments of Labor, Education,
Health and Social Services; University of Alaska,
Alaska State Hospital and Nursing Home
Association, Alaska Workforce Investment Board
and Alaska Native Tribal Health Consortium
· Coalition
o Health Commission, AFL/CIP Alaska Nurses
Association, U.S. Dept. of Labor; Providence
Health and Services, Fairbanks Memorial Hospital,
Laborers Local 341, Alaska Area Health Education
Centers, Trust Training Cooperative, Alaska Rural
Behavioral Health Training academy, Alaska
Behavioral Health Association, service providers,
non-profit agencies, faith-based organizations
and Alaska Native Health Board
Mr. Jessee discussed slide 35: "Results for Beneficiaries."
· 1,684 providers across Alaska attended 2,126 distance
delivery and on-site training sessions on behavioral
health related topics through the Trust Training
Cooperative in FY 12.
· 695 professionals attended Training and Technical
Assistance for Providers program, increasing
providers' capacity to respond to disability-related
abuse cases
· 2,618 individuals received distance delivery and on-
site training on autism through Autism Resource Center
· 1,521 students enrolled in behavioral health training,
of which 295 received a degree, through University of
Alaska in 2011 (2012 data not available)
· 850+ healthcare providers, stakeholders and
policymakers attended presentations and educational
events about the Alaska Health Workforce Coalition
2:14:20 PM
Mr. Jesse discussed slide 36: "Ahead in FY 14."
· Funding Alaska Health Workforce Coalition Coordinator
· Analyzing and applying results of the 2012 Vacancy
Study
· Supporting development of a Graduate Certificate in
Marriage and Family Therapy (LMFT) program at
University of Alaska
· Securing a permanent home within UA system for non-
academic training and professional development for
health careers
Mr. Jessee continued with slide 37: "Ahead in FY 14." He
stated that he would work with subcommittees to increase
funding.
Mr. Jessee discussed slide 38: "Beneficiary Projects
Initiatives."
· Community need:
o peer-based recovery support programs and peer
workforce to provide support to others with
similar experiences
o community-based peer support and other peer-based
recovery programs to help prevent need for more
expensive, intensive levels of service, including
hospitalization and/or incarceration
o recovery support for persons with high severity
and complex social and behavioral health issues
who do not fare well in traditional services
· Partners:
o 27 beneficiary grantee organizations since 2006
o Alaska Peer Support Consortium
o Divisions of Behavioral Health, Senior &
Disability Services Vocational Rehabilitation
o Trust Training Cooperative, Center for Human
Development
o Advisory Board of Alcoholism an Drug Abuse,
Alaska Mental Health Board, Governor's Council on
Disabilities and Special Education, Alaska
Commission on Aging
2:16:03 PM
Mr. Jessee discussed slide 39: "Strategic Thinking."
· Funding and technical assistance to support safety,
effectiveness and sustainability of peer programs and
services throughout Alaska
· Effective collaborations across service system,
advocacy groups and coalitions
· Training and education for peer support workforce
· Integration of peer support specialists across service
delivery systems
· Mini Grants to improve beneficiaries' quality of life
· Small Project Grants for small, beneficiary-focused
projects
Mr. Jessee discussed slide 40: "FY 12 Beneficiary Mini
Grants." He explained that the Trust continued to fund
$1,058,146 in mini grants. The grants were up to $2500 per
person to improve their quality of life. He pointed out
that a significant amount of funds were requested for
dental services that were not met by Medicaid.
2:17:17 PM
Mr. Jessee detailed slide 41: "FY 12 Small Project Grants."
· $250,000 budgeted annually
· 25 grants in FY 12 totaling $191,361
· Up to $10,000 each
· Innovative new projects or enhancements to existing
projects of direct benefit to beneficiaries
· Organizations in Anchorage, Chugiak, Eagle River,
Homer, Juneau, Kodiak, North Pole, Palmer, Scammon
Bay, Sitka and Tanacross
Mr. Jessee slide 42: "Results for Beneficiaries."
· Promotes recovery, stability and wellness
· Provides sense of empowerment and connection
· Reinforces consumer choice in managing recovery
· Wide range of beneficiary-led programs statewide
o peer-support services
o recovery-community support programs
o housing
o clubhouses
o drop-in centers
o community outreach and engagement
o illness self-management
o alternatives to residential treatment
o supported employment
o training and education
Mr. Jessee concluded his presentation with slide 44: "FY 14
Joint Legislative Priorities."
· Shared with all beneficiary advisory boards
o long-term support services for people with
disabilities
o Complex Behaviors Collaborative
2:19:02 PM
Mr. Barton apologized for his voice. He recently underwent
surgery that affected his throat.
Co-Chair Austerman commented that the state was faced with
deficit spending because of decreased oil production. He
noticed the Trust had $1.5 million less in the FY 14 fund
source. He mentioned the increases requested for FY 14 of
$6 million. He addressed the facts to prepare Mr. Jessee
for the subcommittee process.
Representative Kawasaki asked about slide 13 and the
Residential Psychiatric Treatment Centers (RPTC). He
appreciated the support for Fairbanks and the Housing First
model that existed in the district's center. He asked if
available space could be found in the Alaskan RPTCs. Mr.
Jessee responded that there were many beds at the facility
in Fairbanks. The facility was on suspension by the
department for a couple of occasions. The Trust did not
plan to utilize additional beds in the Fairbanks facility.
Representative Kawasaki asked how many beds were
potentially available in the Fairbanks RPTC. Mr. Jessee did
not have an exact number for Representative Kawasaki.
2:22:06 PM
Representative Costello asked why 4.25 percent was the
market value chosen by the Trust for the fund. She wondered
if the amount was in statute or would the Trust consider 5
percent as an alternative. Additionally, she asked about
slide 25 and wondered why a person in foster care was more
likely to die on the streets.
Mr. Jessee responded to Representative Costello's first
question. He explained that when the trustees began their
process in 1995, they faced decisions regarding investment
of the original $200 million endowment. Since the trust was
perpetual, the trustees could not go into the principal,
which would violate the rights of future beneficiaries. A
foundation model was decided upon with a 3 percent
principal. The need for a budget reserve was discovered,
which led to an increase suggested by Callan and
Associates. A decision was made to remain with 3 percent
while saving any additional Permanent Fund earnings until a
total of 400 percent. Within five years the reserve was
fully funded. Once the reserve was fully funded, the
trustees increased the payout to 3.25 percent, while
allowing the reserve to catch up to the higher demand.
Mr. Jessee furthered that the decision was made to
inflation-proof the principal, which led to further
increases in the payout. Since the economic downturn, the
reserve was used to make the payout, and 4.25 percent was
the peak. The maximum sustainable payout had been discussed
and many experts advocated for 5 percent, but the Trust
chose to retain the 4.25 percent payout until the reserve
is once again fully funded and inflation proofing is taken
care of.
2:26:06 PM
Mr. Jessee responded to Representative Costello's second
question about slide 25. He explained that people in foster
care had experienced a break down in the family structure.
Even in the best foster care situations a person's
experience was one of serious disruption in a person's
healthy and productive environment.
2:26:59 PM
Representative Gara explained that the legislature faced
long-term deficit spending. He expressed interest in money
saving tactics that could be presented by the Trust. He
asked if the legislature had funded Housing First. Mr.
Jessee responded in the affirmative. He noted that housing
vouchers through AHFC existed for the Housing First
facilities in Anchorage and Fairbanks.
Representative Gara asked if the funding was in the
governor's proposed budget. Mr. Jessee replied that the
Special Needs Housing Grants through AHFC could be used in
a competitive process for Housing First.
2:28:24 PM
Representative Gara asked about slide 14, which made the
point that a poor upbringing for a child increased the
likelihood for services. He asked if the Office of Children
Services (OCS) might provide assistance in reducing the
number of children in abusive situations that lead to the
need for housing services.
Mr. Jessee replied in the affirmative. He explained that a
parent seeking sobriety was eligible to immediate access to
substance abuse treatment.
Representative Gara referred to the Complex Behavioral
Initiative, which was funded for problems resulting from
brain injuries. He asked if the category was similar. Mr.
Jessee answered in the negative. He elaborated that the
Complex Behavioral Initiative was a specific project, not
yet included in the governor's budget.
Representative Gara asked if the Complex Behavioral
Initiative would serve people with brain injuries. Mr.
Jessee replied in the affirmative.
2:30:47 PM
AT EASE
2:32:25 PM
RECONVENED
^FY 14 GOVERNOR'S BUDGET OVERVIEW: DEPARTMENT OF
ADMINISTRATION
BECKY HULTBERG, COMMISSIONER, DEPARTMENT OF ADMINISTRATION,
delivered the PowerPoint presentation: "Alaska Department
of Administration Department Overview (copy on file)."
2:34:09 PM
Commissioner Hultberg discussed slide 3: "Service Across
Alaska." She explained the department's core purpose to
provide support services for state agencies. The department
included the Division of Motor Vehicles, the Public
Defender Agency and the Office of Public Advocacy. The
department had 1,145 employees in FY 13 with 1.087 serving
in full-time positions, 18 in part-time positions and 40 in
non-permanent positions. The department had 30 different
locations.
Commissioner Hultberg discussed slide 4: "Strategic Plan
Highlights."
· Mission: The mission of the Department of
Administration is to provide consistent and efficient
support services for state agencies.
· Vision: As employees of the Department of
Administration, we will provide innovative, cost-
effective and responsive service.
· Department Goals:
o Service Excellence: Provide excellent program
delivery through clear communication and
respectful and responsive actions.
o Spending Growth Reduction: Reduce the rate of
spending growth to sustainable levels.
o Effective and Efficient Delivery of Services:
Implement strategies to achieve operational
efficiencies.
o Employee Development and Support: Encourage
employee growth and development by providing
leadership, training and resources in an
atmosphere that fosters mutual trust and respect.
· Core Values:
o Integrity: We will be honest, transparent, and
ethical
o Service: We will provide excellent service.
o Accountability: We will take responsibility for
and ownership of the services we provide.
o Balance: We will honor our commitments to our
work and personal lives.
Commissioner Hultberg detailed slide 5: "Department Level
Results." Commissioner Hultberg described the graph
demonstrating the results of the goals listed above. The
graph detailed the five year trend of DOA expenditures and
the moderation of the growth rate during the last few
years. The annual state average for personal services
growth was 5.45 percent, so the department's growth of 2.14
percent exhibited its efficiencies.
Commissioner Hultberg detailed slide 6: "Department Level
Results." She noted that service excellence was surveyed by
the department.
2:36:38 PM
Commissioner Hultberg discussed slide 7: "Share of Total
Agency Operations." For FY 14, the largest share of
designated general funds was the Division of Motor
Vehicles.
Commissioner Hultberg discussed slide 8: "Department Level
Results." She noted that the majority of the department's
costs were paid for by general funds. She explained that 66
percent of the department's budget was "other funds."
Interagency receipts represented approximately 38 percent
of the total budget. Other funds addressed health care
costs and leases.
Commissioner Hultberg discussed additional slide 1:
"Legislative Finance Division - 10 year plan (All Funds)."
The growth of the budget was 5.5 percent annually since
2005. The 10 year plan number did not include the increases
associated with personal services.
2:38:36 PM
Commissioner Hultberg discussed additional slide 2:"
Legislative Finance Division - 10 Year Plan (General Fund
Only)." She pointed out that the two largest recipients of
general funds included the Office of Public Advocacy and
the Public Defender Agency. The two agencies experienced a
growth rate that was higher than the overall department
growth rate.
Commissioner Hultberg discussed slide 9: "Services to the
Public."
· Division of Motor Vehicles
· Office of Public Advocacy
· Public Defender Agency
· Division of Retirement and Benefits
· Office of Administrative Hearings
· Alaska Public Offices Commission
· Alaska Oil and Gas Conservation Commission
· Alaska Public Broadcasting Commission
2:41:11 PM
Commissioner Hultberg discussed slide 10: "Services to
State Agencies." She explained that the department employed
people for state agencies to perform tasks. Labor unions
were negotiated with for wages. Benefits were provided by
the department. Roles existed for the Division of
Personnel, the Division of Finance and the Division of
Retirement and Benefits. The employees were provided with
Enterprise Technology Services, commodities and office
furniture. The employees and the buildings they worked in
were insured against injury through the Division of Risk
Management. Office and lease space was provided by the
Division of General Services.
2:42:32 PM
Commissioner Hultberg discussed slide 11: "Personal
Services." Personal services increased by an average of
5.45 percent per year. Personal services included benefits,
merit increases (both negotiated and statutory) and a
negotiated cost of living allowance. The retirement
contribution was fixed.
2:44:19 PM
Commissioner Hultberg discussed slide 12: "Benefits." The
graph depicted the increase in employer contribution to
employee health plans. The plans included the AlaskaCare
plan, ASEA Health Trust, LTC 51 Health Trust, PSEA, MMP
Health Trust and ASCEA/TEAME.
2:45:27 PM
Commissioner Hultberg discussed slide 12: "Benefits
PERS/TRS." The chart depicted the actual benefit payments
that would be made to retirees in the defined benefit plans
over the next 70 years. She noted that many new retirees
were entering the system creating an operational challenge.
A statewide challenge also existed regarding the management
of the ongoing liability. The unfunded liability was
estimated at $11.9 billion.
2:47:11 PM
Commissioner Hultberg discussed slide 15: "Business
Processes." Business processes included payroll,
procurement and accounting. The department sought
improvements to the business processes. She introduced the
Integrated Resource Information System (IRIS) project,
which would replace the 25 year-old payroll and accounting
systems. The IRIS system would add a human resources and
procurement system and streamline all business process for
the state. The new system promised to allow opportunities
for savings.
2:49:19 PM
Commissioner Hultberg discussed slide 16: "Space Costs."
She explained that the department could do little to
control the costs that were climbing because of natural
inflation and greater space needs.
2:49:55 PM
Commissioner Hultberg discussed slide 17: "New Universal
Space Standards." She noted that the state's space
standards were loosely enforced. The anticipation was for
savings of $125 million over the next 20 years with reduced
lease costs in the new plan. She noted concern and anxiety
among employees regarding the space changes, but she had
personally toured facilities implementing the concept and
found them to be light and pleasing. She mentioned the
added productivity value of the design.
2:51:27 PM
Commissioner Hultberg discussed slide 18: "Purchasing."
The Division of General Services (DGS) awards multi-
department contracts for use by all Executive Branch
agencies and various political subdivisions of the
state.
The total savings realized by DGS for FY 12 is
$46,691,337, with $36,191,752 being saved by state
agencies and the remaining $10,499,585 being saved by
political subdivisions of the state.
Some examples of state savings:
· Software - $11,991,321
· PCs, Printers, and Peripherals (WSCA) $7,123,705
· Industrial Supplies and Equipment (WSCA)
$4,368,075
· Marine Diesel Fuel - $3,835,929
· Fuels: Heating, Diesel, Unleaded, Jet A, Aviation
- $2,517,028
· System Furniture Add-On - $2,475,082
2:52:17 PM
Commissioner Hultberg discussed slide 19: "IT Services."
· Enterprise Technology Services Priorities.
· Bandwidth
· Security: Department Gap Analysis
· Mobile Device Strategy and Support
· Continuity of Operations (COOP)
· Identity Management: myAlaksa V3
· Experienced-based rate-setting and rate-setting
alignment with budget process.
2:55:33 PM
Commissioner Hultberg discussed slide 20: "Insurance and
Injury: Risk Mgmt." She explained that risk management
costs continued to rise. The budget in recent years
exceeded the authorization. When risk management exceeded
authorization, the Catastrophic Reserve Fund was utilized.
The fund was maxed out and the department requested an
additional authorization.
2:56:49 PM
Commissioner Hultberg discussed slide 21: "Operating
Increments."
Maintenance of Services
· ALMR: Restore one-time increment, "$1.5 million UGF
· ALMR: maintenance costs and receipt authority, $1.6
million ($600.0 UGF, $500.0 I/A, %500 statutory
designated program receipts)
· DOA: "Core Services" Increases, $725.4 UGF
· General Services: Interagency Receipts, $663.6 total
other ($465.91/A receipts and $197.7 PBF)
o Lease costs, $100.0 I/A
o Lease Administration, $265.9 I/A
o Facilities operation and maintenance costs,
$100.0 I/A
o Facilities administration, funding for two new
PFT positions, $197.7 PBF
3:01:07 PM
Commissioner Hultberg discussed slide 22: "Operating
Increments"
New Programs/Program Expansion
· Risk Management: Rising medical and legal costs
of insurance premiums, $4,224.2 (I/A)
· Health Plans Administration: Third party
administrator contract increase for new health
contract, $1.5 million (Group Health and Life
Benefits Fund)
· Enterprise Technology Services:
o Additional receipt authority to accurately
charge user agencies for legacy systems,
$1.2 million (ISF)
o Decrement to eliminate uncollectable federal
receipt authority, $1.7 million (federal
receipts)
· Retirement & Benefits: consolidation and
automation of division processes: $875.0
(various)
· AOGCC: increased overtime for petroleum
inspectors, $125.0 (AOGCC receipts)
3:03:30 PM
Commissioner Hultberg discussed slide 23: "Department Level
Results."
· Continuation of partial HR decentralization from the
Division of Personnel: transfer 43 PFT positions back
to agencies for recruitment and management services
· Legal & Advocacy Appropriation
o No anticipated supplemental
o Potential increment in Governor's Amended
· Bargaining Unit Negotiations
o General Government Unit (ASEA)
o Supervisory Unit (APEA)
o Confidential Employees Association (APEA)
Commissioner Hultberg explained that feedback from agency
customers communicated that the department did not
understand the unique needs of the divisions leading to the
changes made. She noted that contracts were bargained on a
rotating basis. The two largest bargaining units were
negotiated in 2013. The cost of the contracts were not
included in the governor's budget, but would be presented
to the legislature on March 15, 2013.
3:06:33 PM
Commissioner Hultberg detailed slide 24: "Capital
Requests."
· APBC: Alaska Rural Communications System: Digital
Conversion, $5,300,000 UGF
· DGS: Douglas Island Building, $9,600,000 UGF (year 2
of 2)
· DGS: Repair Juneau State Office Building Parking
Garage, $2,000,000 UGF (phase 2 of 3)
· DGS: Nome State Office Building, $3,252,170 UGF
· DGS: Alaska Geologic Materials Center Replacement
Facility, $15,000,000 UGF (phase 2 of 4)
· DGS: ADA Improvements, $192,300 UGF
· DGS: Capital Asset Management System: $2,000,000 UGF
· DGS: Deferred maintenance: $7,017.0 UGF plus
$3,000,000 PBF
· DRB: Combined Retirement System Upgrade, $350,000 UGF
(phase 4 of 5)
· DRB: Document Management System, $135,000 UGF (year 4
of 4)
· DRB: Retirement and Benefits Policy Automation,
$880,000 UGF
· DRB: Retirement and Benefits Identity and Security
Governance, $749,400 UGF
· ETS: Virtual Tape Systems Replacement, $500,000 UGF
3:11:01 PM
Co-Chair Austerman commented on IRIS. He noted that
multiple departments requested modernized systems. He hoped
that the departments were communicating with each other
about their upgrades. Commissioner Hultberg stated that she
had discussed the IRIS system with every commissioner
individually. She stressed the importance of the upgrade.
She felt that coordination about the upgrades was a work in
progress and she promised to make her best effort to
communicate well with the other agencies.
3:13:03 PM
Co-Chair Austerman agreed that changes in the systems were
necessary. He discussed slide 16 and the graph's
importance. He expressed concern about the rising costs of
leases. He hoped that the department would present a plan
to purchase buildings in an effort to reduce costs.
3:14:37 PM
Commissioner Hultberg agreed and recalled a proposal to
build a large office building in Juneau during the time
that the existing building's lease was expiring. She wished
to optimize the state's office building's space prior to
spending the capital on a new building. The Space Standards
Initiative was an effort to optimize existing office space.
Co-Chair Austerman opined that the department's 10-year
plan did not look very good.
3:15:51 PM
Representative Wilson asked about rising oil prices and
wondered about a change to pellet stoves. Commissioner
Hultberg replied that the department commissioned studies
on a couple of buildings to ascertain the savings from
pellet stoves. She would provide the results to the
committee.
3:16:26 PM
Representative Kawasaki commented that DOA was comprised of
various unique divisions. He pointed out slide 17 and asked
about the space standards. Commissioner Hultberg responded
that while the offices seemed small, the plan's
incorporation of natural light provided a feeling of
spaciousness. The department's plan would create open,
light, collaborative spaces for people to work. Private
meeting places and café style break rooms were part of the
plan. She added that private offices were restricted to
directors and their superiors with the exception of a few
specific job classes.
3:19:46 PM
Representative Kawasaki pointed out that the six-by-six
space was very small. He compared the space requirements of
prisoners in the new Goose Creek Correctional facility to
those proposed in the department's plan. He commented that
the prisoner would receive more space than the social
worker writing his transition plan. He did appreciate the
cost saving intention.
Representative Kawasaki discussed the capital requests and
the Douglas Island Building, the Nome State Office Building
and the deferred maintenance proposal. He asked if the
proposals would receive the same space savings plan.
3:21:18 PM
Commissioner Hultberg replied that she was planning to
implement the space savings plan on renovated buildings.
She stated that the capital projects were still in the
early stages before the RFP process.
3:21:54 PM
Representative Gara asked why agencies were not combined
with other agencies in buildings. Commissioner Hultberg
replied that the goal was to best utilize the space, even
if the building housed multiple agencies.
Representative Gara asked if agencies would be combined in
buildings. Commissioner Hultberg replied in the
affirmative. She noted that the Nome State Office Building
housed multiple agencies.
3:23:09 PM
Representative Gara asked about slide 12. He noted that the
medical care costs had increased in Alaska faster than any
state in the country. He requested testimony from the
Health Care Commission. He asked if the commissioner had
worked with other departments to reduce medical costs.
Commissioner Hultberg responded that she spoke often with
Commissioner Streur about the potential for an enterprise
view of healthcare cost to leverage the resources. She
noted that DOA operated from a different set of rules that
Department of Health and Social Services and Medicaid. She
spoke about the implementation of the Employee Wellness
Program. She hoped that members could become better
consumers. She offered to provide the legislature with more
information following the process of choosing new vendor
partners. The third party administrator piece would play a
large part in the department's cost-saving plans.
3:26:59 PM
Representative Gara asked about slide 24 and the
department's capital management system. He understood that
the system would help determine when maintenance was
needed. Commissioner Hultberg responded that if the
necessary repair was visible, then yes, but she presented
the example of a boiler repair, which might not be apparent
and was a candidate for capital planning. She added that
the state owned thousands of buildings, so the potential
for missing a problem was great. She advocated for a manual
tracking system.
3:28:33 PM
Representative Gara discussed denial of colonoscopy
coverage for retired state employees. He understood that
the recommendation by doctors was for people over 50 to
receive routine colonoscopy. Commissioner Hultberg replied
that the issue was complex. Preventative care was not
available to retirees and the plan was covered by the
diminishment clause of the constitution. Raising the
deductible and copay of the retiree plan was viewed as a
diminishment. Deductibles and copays could not be adjusted
for inflation. She stated that approximately $4 billion of
the $12 billion in unfunded liability was related to health
care costs. Adding a service like colonoscopy would further
increase the state's unfunded liability. Changes made in
the plan would lead to litigation and the state actuaries
were working to determine the best approach.
3:31:57 PM
Representative Gara noted that a supplemental request was
not provided to the legislature. He commented on the
guardian ad litem position in the Office of Public
Advocacy. The attorneys represented foster kids and other
children in need of aid. He understood that the guardian ad
litem position was overburdened. Commissioner Hultberg
clarified that while the Office of Public Advocacy did not
require a supplemental request, needs did exist in the
agency and the needs would be addressed by the department.
3:33:19 PM
Representative Thompson appreciated the presentation. He
discussed the Alaska Land Mobile Radio (ALMR). He noted
that decreases in federal funding would force some
communities to opt out of the program, which would increase
costs to the others remaining. Commissioner Hultberg
agreed. She decided not to assess and bill individual
communities for that reason. The department recommended
that the ALMR payment was made on behalf of the communities
rather than by the communities. She recognized the
importance and value of the ALMR service.
3:35:16 PM
Representative Thompson expressed constituent concerns that
a portion of a community's revenue sharing would be used
for ALMR. Commissioner Hultberg responded that she would
not have input in the decisions regarding revenue sharing.
HB 65 was HEARD and HELD in committee for further
consideration.
HB 66 was HEARD and HELD in committee for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| MHTA HFIN Overview 1_29_13.pdf |
HFIN 1/29/2013 1:30:00 PM |
Mental Health Budgst Overview |
| DOA-DeptOverview2013(01-29-13) HF.pdf |
HFIN 1/29/2013 1:30:00 PM |
DOA Overview |
| DOA Response -HFIN Overview - 29Jan13.pdf |
HFIN 1/29/2013 1:30:00 PM |
DOA Response Overview HFIN |