04/21/1995 09:35 AM Senate FIN

                                                                               
       HOUSE BILL NO. 108                                                      
       "An Act relating to claims  on permanent fund dividends                 
  for        defaulted public assistance overpayments."                        
                                                                               
  Marveen Coggins, Legislative  Aid to Representative  Toohey,                 
  testified that  HB 108  gives the  Dept of  Health &  Social                 
  Services authority  to collect delinquent  public assistance                 
  overpayments   by   administrative    garnishment   of    an                 
  individual's permanent  fund dividend.   Frequently, persons                 
  who did receive  overpayment have agreed to repay  the debt,                 
  but  despite  repeated  request  for  payment, the  debt  is                 
  ignored.   Currently, outstanding  delinquent  debts are  in                 
  excess of one-half million dollars.  HB 108 will allow for a                 
  less  expensive,  more  expedient administrative  procedure.                 
  Recovery of the  debt would  be pursued in  the same  manner                 
  that delinquent student  loans are pursued.   The Department                 
  supports HB  108. There  are two  revenue generating  fiscal                 
  notes from the Dept of Health & Social Services and the Dept                 
  of Revenue.                                                                  
                                                                               
  Elmer Lindstrom,  Special Assistant  to the Commissioner  of                 
  the Dept of Health &  Social Services joined the  committee.                 
  He stated that over  time, the amount of money  generated by                 
  the program would decline.   The first amount is  reflective                 
  of backlogged claims that this bill  would allow the Dept to                 
  collect.  He stated  that amount of individuals  effected in                 
  FY 96 is 75.  AFDC claims from 60 to 90 in 2001.   There are                 
  12,000 families receiving public assistance in Alaska.                       
                                                                               
  Senator  Sharp  asked  if  the   permanent  funds  would  be                 
  subsidizing the  Dept  of Health  &  Social Services.    Mr.                 
  Lindstrom assured  the committee that this bill  is the same                 
  as any other garnishment  situation.  It is the  individuals                 
  dividend that is  garnished, not  taken off the  top of  the                 
  pool of funds  available for  dividends, as is  the case  of                 
  those that are indicated on the dividend check stub.                         
                                                                               
  Senator  Rieger  questioned  why  this  bill  is  necessary,                 
  because the  existing law  sounds as  though it  covers this                 
  situation.  Mr.  Lindstrom responded  that with the  federal                 
  tie-in with AFDC, it requires specific statutory authority.                  
                                                                               
  Senator Sharp MOVED HB 108 with  individual recommendations.                 
  Without objections HB 108 was REPORTED OUT of committee with                 
  a "do pass" recommendation and three  fiscal notes.  Dept of                 
  Revenue,  zero; Dept of Health & Social Services, zero, $3.4                 
                                                                               
                                                                               
  revenue; and Dept  of Health & Social Services (AFDC), zero,                 
  $16.4 revenue.