03/31/2017 01:30 PM House FINANCE

HOUSE BILL NO. 141                                                                                                            
                                                                                                                                
     "An Act relating to allocations of funding for the                                                                         
     Alaska Workforce Investment Board; and providing for                                                                       
     an effective date."                                                                                                        
                                                                                                                                
2:07:26 PM                                                                                                                    
                                                                                                                                
Co-Chair  Foster relayed  that the  bill was  last heard  on                                                                    
Monday,  March 16,  2017 when  public testimony  was closed.                                                                    
There were no amendments from committee members.                                                                                
                                                                                                                                
2:07:49 PM                                                                                                                    
                                                                                                                                
MARY  SCHLOSSER,  STAFF,   REPRESENTATIVE  FANSLER,  briefly                                                                    
reminded  the committee  that HB  141 allocated  funding for                                                                    
the  Alaska   Workforce  Investment  Board,  which   had  10                                                                    
benefactors  under  the   Alaska  Technical  and  Vocational                                                                    
Education Program (TVEP).                                                                                                       
                                                                                                                                
2:09:11 PM                                                                                                                    
                                                                                                                                
Vice-Chair Gara  reviewed the fiscal notes.  He relayed that                                                                    
the  fiscal impact  note from  the  Department of  Education                                                                    
(DEED)  FN1  (EED)  in  the amount  of  $478.8  thousand  in                                                                    
Designated General Funds (DGF)  was allocated to Student and                                                                    
School  Achievement in  FY  2018. He  turned  to the  fiscal                                                                    
impact note from  the University of Alaska (UA)  FN4 (UA) in                                                                    
the  amount  of  $5386.6  million DGF  allocated  to  Budget                                                                    
Reductions/Additions  System Wide  in FY  2018. He  moved to                                                                    
the new Department of Labor  and Workforce Development (DOL)                                                                    
fiscal  impact note  in the  amount of  $4210.1 million  DGF                                                                    
that was allocated  to Workforce Development in  FY 2018. He                                                                    
addressed another  new fiscal  impact note  from DOL  in the                                                                    
amount of  $2034 million allocated to  the Alaska Vocational                                                                    
Technical Center (AVTEC)  in FY 2018. He  pointed to another                                                                    
new fiscal  note from DOL  in the amount of  $408.9 thousand                                                                    
DGF allocated to Unemployment Insurance in FY 2018.                                                                             
                                                                                                                                
2:11:22 PM                                                                                                                    
                                                                                                                                
Representative  Wilson   asked  whether  the   fiscal  notes                                                                    
reflected the  reductions in  the governor's  amended budget                                                                    
because the  state did not  receive as much  unemployment as                                                                    
expected.  Ms.  Schlosser   responded  in  the  affirmative.                                                                    
Representative   Wilson  deduced   that  the   fiscal  notes                                                                    
reflected  the "new  amounts in  the governor's  budget that                                                                    
were  adjusted."  She wondered  how  the  fiscal notes  were                                                                    
maintained  at  the  same  level   in  the  out  years  when                                                                    
unemployment increased.                                                                                                         
                                                                                                                                
2:12:08 PM                                                                                                                    
                                                                                                                                
PALOMA    HARBOUR,    ADMINISTRATION   SERVICES    DIRECTOR,                                                                    
DEPARTMENT  OF LABOR  AND  WORKFORCE DEVELOPMENT,  explained                                                                    
that the fiscal  note simply reflected that  the program was                                                                    
extended for  five years. The out-year  amounts would change                                                                    
based  on the  amount  in  the fund  but  was impossible  to                                                                    
predict.  The amounts  would be  "trued up"  each year.  She                                                                    
affirmed  that the  fiscal  notes  reflected the  governor's                                                                    
amended  TVEP amounts  based on  a lower  fund balance  than                                                                    
originally projected.                                                                                                           
                                                                                                                                
2:13:01 PM                                                                                                                    
                                                                                                                                
Co-Chair  Seaton MOVED  to report  HB 141  out of  Committee                                                                    
with individual recommendations  and the accompanying fiscal                                                                    
notes.  [The bill  was set  aside for  further consideration                                                                    
and no action was taken].                                                                                                       
                                                                                                                                
Representative Wilson OBJECTED.                                                                                                 
                                                                                                                                
Representative  Wilson  explained  her objection.  She  felt                                                                    
that many changes  had taken place with  the "whole program"                                                                    
and unemployment that affected the  bill. She had also "been                                                                    
approached by  some different  schools" engaged  in training                                                                    
that were not listed as  benefactors in the bill. She opined                                                                    
that  an action  to report  the  bill out  of committee  was                                                                    
premature.                                                                                                                      
                                                                                                                                
Vice-Chair  Gara   asked  whether   the  funding   from  the                                                                    
Unemployment Insurance  Trust Fund  in the fiscal  notes for                                                                    
FY  19 were  accurate  and would  need  adjusting in  future                                                                    
years. Ms. Harbor answered  affirmatively and confirmed that                                                                    
it would  be adjusted each  year based on the  fund balance.                                                                    
Vice-Chair  Gara commented  that previously  changes to  the                                                                    
educational  institutions   covered  under  the   bill  were                                                                    
attempted, but  the more institutions that  were covered the                                                                    
less  funding  each  institution  received.  He  noted  that                                                                    
amendments were  due, and none  were received.  He preferred                                                                    
to move the bill out of committee unaltered.                                                                                    
                                                                                                                                
2:14:59 PM                                                                                                                    
                                                                                                                                
Co-Chair  Foster acknowledged  that  there  were many  other                                                                    
entities that  would like to  be on the benefactor  list and                                                                    
some  present  benefactors  that  wanted  more  funding.  He                                                                    
thought that discussions  regarding funding recipients would                                                                    
be  "extensive."  He related  that  whether  the matter  was                                                                    
revisited in a  future session or the bill was  moved out of                                                                    
committee  was a  "policy call."  The  department wanted  to                                                                    
"advance a clean bill" during the current session.                                                                              
                                                                                                                                
2:15:47 PM                                                                                                                    
                                                                                                                                
Representative  Tilton  reported  that  she  had  also  been                                                                    
contacted by  a some of  the institutions and asked  to hold                                                                    
the bill for further discussion.                                                                                                
                                                                                                                                
2:16:23 PM                                                                                                                    
                                                                                                                                
Co-Chair Foster asked what would  happen if the bill was not                                                                    
adopted in  the current  year. Ms. Schlosser  responded that                                                                    
if  the legislature  did not  allocate the  funds the  money                                                                    
would remain in the fund. She  added that the issue was time                                                                    
sensitive.  Co-Chair Foster  surmised that  if the  bill was                                                                    
not  adopted  the funds  would  not  be distributed  to  any                                                                    
vocational  school. Ms.  Schlosser responded  affirmatively.                                                                    
Co-Chair  Foster  commented that  he  was  not objecting  to                                                                    
changing  recipients,  but the  action  could  "result in  a                                                                    
Pandora's  Box"  allowing  time to  run  out.  He  mentioned                                                                    
saving  the   discussion  for  the  following   session.  He                                                                    
restated  that  the decision  was  up  to  the will  of  the                                                                    
committee.                                                                                                                      
                                                                                                                                
2:18:02 PM                                                                                                                    
                                                                                                                                
Representative  Thompson  asked  what might  happen  if  the                                                                    
money was  not distributed. He  wondered whether any  of the                                                                    
institutions would close. Ms.  Schlosser responded that many                                                                    
of the  smaller vocational  schools received  the "majority"                                                                    
of its  funding through  the program.  She voiced  that they                                                                    
would either close or "drastically" reduce services.                                                                            
                                                                                                                                
Representative Wilson believed  that temporarily holding the                                                                    
bill  in  committee  was not  threatening  adoption  in  the                                                                    
current session.                                                                                                                
                                                                                                                                
Vice-Chair Gara  relayed from  previous experience  that the                                                                    
attempt to  add more  schools ended "in  a long  battle." He                                                                    
felt that  the discussion was "legitimate"  but worried that                                                                    
a "full policy debate" would  threaten current action on the                                                                    
bill  and  jeopardize  funding. He  suggested  delaying  the                                                                    
discussion.                                                                                                                     
                                                                                                                                
2:20:26 PM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
2:20:55 PM                                                                                                                    
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Foster indicated he would set the bill aside.                                                                          
                                                                                                                                
HB  141  was  HEARD  and   HELD  in  committee  for  further                                                                    
consideration.