Legislature(2001 - 2002)
04/25/2001 01:48 PM House FIN
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HOUSE BILL NO. 108
"An Act relating to the accounting for and
appropriation of fees for recording and related
services by the Department of Natural Resources; and
providing for an effective date."
NICO BUS, ADMINISTRATIVE SERVICES MANAGER, DIVISION OF
SUPPORT SERVICES, DEPARTMENT OF NATURAL RESOURCES testified
in support of the legislation. The legislation would change
the funding source for the state recorder's operations from
program receipts to receipts supported services. He observed
that HB 418 provided authorization for use of customer
receipts to support their programs. He emphasized the
difficulty of the Recorder's Office to compete with other
programs within the Department of Natural Resources. The
Recorder's Office generates approximately $4 million dollars
in receipts. The operating costs for the Recorder's Office
is approximately $2.4 million dollars.
Vice-Chair Bunde questioned if customers are being charged
too much if revenues generate more than the cost of
operations. He added that the legislation would take the
legislation out of the appropriation process. Mr. Bus
responded that the change would retain the requirement for
annual legislative authorization. He clarified that
recording is one responsibility of the office and archiving
is another. There are many records that have not been
archived. Storage adds to the costs. Municipalities that
have stored records over the years are returning books that
must be stored to the state of Alaska. He noted that the
alternative is to close offices.
Representative Hudson noted that there are records dating
back to the 1800's. He spoke in support of placing the
program under receipts supported services.
In response to a question by Representative Lancaster, Mr.
Bus explained that the Palmer Office is moving from a 15-
year lease. The increase in population over the past 15
years has resulted in an overcrowded facility. The lease
cost was only .70 cents, since it was negotiated 15 years
ago. They now have to pay current market value. The office
requires more square footage at increased cost. In addition,
the office has inherited equipment from the Alaska Court
System that has no maintenance agreements. All documents
presented to the recorder's office must be returned via mail
to the customer. Postal fee increases have added to
increased cost.
Representative Harris noted that there are three offices
operated by the Alaska Court System: Seward, Valdez and
Glennallen. Court activities receive priority in these
offices. Mr. Bus stressed the need to identify personnel to
fulfill this function. The Department of Natural Resources
operates the other 11 offices.
In response to a question by Representative Harris, Mr. Bus
clarified that since the implementation of the State's
Recorder's Office Index System they have provided a daily
on-line transfer index without missing a day.
Vice-Chair Bunde maintained that funding for the Recorder's
Office should be considered with all other expenditures. Mr.
Bus responded that detailed expenditures are submitted to
the legislature. Funds are not dedicated and must receive
legislative authorization. The purpose is to present their
true needs within the competition of the entire department.
Co-Chair Mulder pointed out that there is a lot of activity
in the Nome office, yet it was the first office cut.
Representative John Davies noted that the fundamental policy
question is should they be in the category of receipts
supported services. He acknowledged that the service
generates a lot of fees and the customers are frustrated
because the service cannot be advanced in appropriate ways.
The legislation would take away the artificial cap issue and
allow decisions to be based on the proper level of service.
Vice-Chair Bunde maintained that the budget for the
Recorder's Office would be increased from $2.4 to $4 million
dollars by the passage of the bill. Representative John
Davies argued that subcommittees would still review the
funding, but that the arbitrary cap would be removed.
Representative Hudson stressed that the change would allow
better bookkeeping. Services would be tied to revenues. He
pointed out that [under the current system] general fund
expenditures are reduced to an agency that is earning its
own keep.
Representative Whitaker observed that the revenues would be
used to provide better service where they are earned. The
legislation would provide a structural change, by dedicating
them to the department where they are produced. He pointed
out that the same argument could be made in the Division of
Oil and Gas and expressed concern that the dedication may
not be in the best interest [of the Legislature].
Mr. Bus argued that workload is directly related to the
customer's action.
Representative Harris spoke in support of the legislation.
He noted the number of complaints from the public sector
regarding the level of service. The Legislature would still
have to approve the funds, but it would not be counted
against the general fund component. He maintained that
accountability would continue through the budgeting process.
Representative John Davies argued that the legislation does
not create a dedicated fund. He felt that it is more of an
issue of fund source: a different type of program receipt.
It would be a sub account in the General Fund and
expenditures would not be automatic.
Representative Whitaker asked if there is a current document
backlog. Mr. Bus noted that the statutes require 24 hour
indexing. The problem occurs after the indexing. There is a
backlog in archiving. There are rooms full of information
that is not available to the public because it must be
filmed and digitized. He discussed means to reduce the
backlog.
Representative Whitaker summarized that there is a backlog
of work that could be solved with an allocation of funds.
Mr. Bus observed that capital project funding has been
requested for the past several years. The funds have not
been sufficient to keep up with the level of work. Capital
requests have been funded. If the legislation were passed
the level of funding would remain at $2.5 million dollars
unless the court offices were included. The Recorders'
Office has requested additional operational funding, which
has not always been received.
Co-Chair Mulder summarized that the issue differs from past
functions because it makes more money than the cost of
operations. He expressed confidence that the subcommittee
chair would watch expenditures and added sympathy for user
groups that want a timely product for their fee.
Vice-Chair Bunde maintained that the department would still
request additional funds. He argued against passage of the
legislation.
Representative Foster MOVED to report HB 108 out of
Committee with the accompanying fiscal note. Vice-Chair
Bunde OBJECTED.
A roll call vote was taken on the motion to Move HB 108 from
Committee.
IN FAVOR: Davies, Foster, Harris, Hudson, Lancaster,
Whitaker, Croft, Williams, Mulder
OPPOSED: Bunde
Representative Moses was absent from the vote.
The MOTION PASSED (9-1).
HB 108 was REPORTED out of Committee with a "do pass"
recommendation and with a previously published fiscal impact
note (#1) by the Department of Natural Resources.
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