Legislature(2019 - 2020)ADAMS 519
03/12/2020 09:00 AM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB268 | |
| HB181 | |
| Consideration of Governor's Appointee: Lucinda Mahoney, Commissioner, Department of Revenue | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 268 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | TELECONFERENCED | ||
| + | HB 181 | TELECONFERENCED | |
HOUSE BILL NO. 181
"An Act relating to mental health education."
10:09:32 AM
Co-Chair Johnston invited the sponsor to the table.
REPRESENTATIVE MATT CLAMAN, SPONSOR read prepared
statement:
Co-chairs, members of the House Finance committee,
thank you for hearing House Bill 181, "An Act relating
to mental health education." House Bill 181 amends the
existing K-12 public school health education statute
to include mental health guidelines for all K-12
health classrooms to educate students on vital
information about mental health symptoms, resources,
and treatment.
Currently, the Alaska health curriculum guidelines
include prevention and treatment of diseases; learning
about "good" health practices like diet, exercise, and
personal hygiene; and "bad" health habits such as
substance abuse, alcoholism, and physical abuse. But
the guidelines do not address mental health. HB 181
will result in updating the health curriculum
guidelines to include mental health. It is important
to keep in mind, however, that the guidelines are
voluntary and school districts can choose whether to
offer health classes. The local districts retain
control of their health curriculum.
Lucas Johnson, who you will hear testify today, was 18
years old and in his junior year at Monticello High
School in Virginia's Albemarle County when he and
fellow classmates Alexander Moreno and Choetsow Tenzin
began lobbying for more mental health resources in
their school. From troubling social media posts to
bullying to students in distress who felt they had
nowhere to turn, Johnson and his classmates saw how
unaddressed mental health was hurting their peers.
Johnson and his classmates recognized that while the
Virginia Board of Education's Standards of Learning
already included some mental health education, the
standards were by no means comprehensive. So, they
pushed for a law that would require the Board of
Education to review and update the health Standards of
Living for students in grades 9 and 10 to include
mental health. Since this provision was signed into
law in Virginia in March of 2018, the State of Maine
passed a similar law. Now, we have the opportunity to
consider similar legislation in Alaska, where the
statistics show that the severity of unaddressed
mental health among our youth and teenage populations
is nothing short of a public health crisis.
According to the 2017 Alaska High School Youth Risk
Behavior Survey, which surveyed 1,343 students in
grades 9-12 from 40 high schools across the state,
more than 1 in 3 students reported feeling sad or
hopeless, for a period of at least 2 weeks, during the
12 months preceding the survey. Furthermore, the
SAMHSA National Survey in Drug Use and Health
estimates that in 2015 and 2016, 15% of adolescents
aged 12-17 reported that they had at least 1 major
depressive episode during the 12 months preceding the
survey. Both of these studies are included in your
bill packets for reference.
HB 181 requires the Alaska State Board of Education
and Early Development and the Alaska Department of
Education and Early Development to develop guidelines
for instruction in mental health education in
consultation with the Alaska Department of Health and
Social Services, counselors, educators, students,
administrators and representatives of national and
state mental health organizations and regional tribal
health organizations.
After standards have been developed, the Alaska State
Board of Education and Early Development and the
Alaska Department of Education and Early Development
will be responsible for facilitating implementation
throughout the Alaska school system, utilizing an
existing school health education specialist position
to assist in state-wide program coordination. As with
existing health education curriculum, the Department
of Education and Early Development, the Department of
Health and Social Services, and the Council in
Domestic Violence and Sexual Assault will provide
technical assistance to school districts in the
development of curricula.
The state has a responsibility to treat the current
mental health crisis in Alaska as a serious public
health issue. By creating mental health education
standards and encouraging schools to teach a mental
health curriculum, HB 181 aims to decrease the stigma
surrounding mental illnesses and increase students'
knowledge of mental health, encouraging conversation
around and understanding of the issue.
Representative Claman indicated his staff, Sophie Jonas,
would present a Sectional Analysis of the bill.
10:15:52 AM
SOPHIE JONAS, STAFF, REPRESENTATIVE MATT CLAMAN read the
sectional analysis:
Section 1
Legislative Intent
Adds intent language stating it is the intent of the
legislature that the Board of Education and Early
Development develop guidelines for instruction in
mental health in consultation with representatives of
mental health organizations and regional tribal health
organizations, including the National Council for
Behavioral Health, Providence Health and Services
Alaska, Southcentral Foundation, Anchorage Community
Mental Health Services, Inc., North Star Behavioral
Health System, and the National Alliance on Mental
Health Illness Alaska.
Section 2
AS 14.30.360. Health education curriculum; physical
activity guidelines. Amends AS 14.30.360 by removing
the word "physical" when referencing instruction for
health education and adding "mental health" to the
list of curriculum items each district includes in
their health education programs.
Section 3
AS 14.30.360. Health education curriculum; physical
activity guidelines. Amends AS 14.30.360 by clarifying
that health guidelines developed by the Board of
Education and Early Development must provide standards
for instruction in mental health and be developed in
consultation with the Department of Health and Social
Services and representatives of national and state
mental health organizations.
Section 4
Amends the uncodified law of the State of Alaska by
adding a new section to read "the state Board of
Education and Early Development shall develop the
mental health guidelines required by AS 14.30.360(b),
as amended by sec. 3 of this Act, within two years
after the effective date of this Act."
Ms. Jonas was available for questions.
10:17:34 AM
[A video was played entitled, "And Mental Health."]
10:21:45 AM
Co-Chair Johnston indicated there was invited testimony.
She asked testifiers to limit their testimony to 3 minutes.
JASON LESSARD, EXECUTIVE DIRECTOR, NATIONAL ALLIANCE ON
MENTAL ILLNESS (NAMI), ANCHORAGE, spoke in support of
HB 181. He provided some background information and
important statistics. He reported that one in five teens
had a serious mental disorder at some point in their lives.
He claimed that 50 percent of all lifetime mental illnesses
began by age 14 and 75 percent by age 24. He recognized
that mental illness onset was largely happening in the
teenaged brain and in the brain of transitional aged youth.
He returned to the notion that half of all lifetime mental
illnesses began by freshman year of high school for youth.
He thought it was imperative to have safe informed
conversations with youth about mental illnesses and mental
wellness. One of the largest barriers to seeking help was
stigma. He asserted that stigma was born of ignorance and
education was the most effective antidote.
Mr. Lessard asserted that although there were several great
programs educating youth and staff around the state, the
programs did not engage directly with Alaska's youth. He
thought the bill would help to put standards into place. He
asserted that not all programs were created equal. Although
some of the programs were created with good intentions,
some of them had negative or fatal consequences. He noted
the example of ALICE Training the active shooter drill
training. Improperly implemented, the trainings were
causing Post Traumatic Stress Disorder (PTSD) in some
youth. He also pointed out that interaction between peers
was imperative. He mentioned a NAMI program that was
presented in schools that had been effective in changing
knowledge and attitudes towards mental health as well as
seeking help. The National Council on Behavioral Health saw
value in early engagement and was currently piloting a teen
mental health first aid program in various communities
around the state. He stressed the importance of adding
mental health to the current health curriculum statute and
creating guidelines to ensure that the curriculum was being
implemented safely and effectively in the various
districts.
10:27:08 AM
LUCAS JOHNSON, SELF, BRUNSWICK, MAINE, supported HB 181. He
spoke of the importance of ensuring that all students had
the opportunity to talk about and learn about mental
health. He thought it was critical to have mental health
education within Alaska's statutes and in its classrooms.
He believed that HB 181 was an integral bill to ensuring
all students were given the opportunity to learn about one
of the most important aspects of their health: mental
health. He suggested that it was fundamental to understand
that having the requisite language, materials, and
knowledge to get help when a person needed it was as
important as teaching someone about any other part of their
body. He thought HB 181 would ensure that Alaska's youth
received what they needed. He thought the statistics
mentioned by the previous speaker provided enough evidence
that early intervention in teaching youth about mental
health was critical. He reiterated his support FOR HB 181.
10:29:56 AM
NATALIE FRASER, MENTAL HEALTH ADVOCACY THROUGH STORY
TELLING, ANCHORAGE, spoke in support in HB 181. She was
currently a high school student in Anchorage. She talked
about learning about physical health and care. However, she
experienced mental health conditions that were detrimental
to her wellbeing. She believed that mental illness was
thought to be what other people had. She talked about the
benefits of suicide prevention programs. She indicated that
if she had not received help from a suicide prevention
program, she would not be present today. She thought it was
important to recognize that life was hard. She reiterated
her support for HB 181.
10:32:59 AM
Co-Chair Johnston OPENED Public Testimony.
ZOE KAPLAN, MENTAL HEALTH ADVOCACY THROUGH STORY TELLING,
ANCHORAGE, spoke in support of HB 181. She provided a
personal experience with depression. She had a network of
support. However, she relayed her observation of others
struggling with their mental Health. She thought mental
health had not become a topic of normal conversation. She
suggested that people were not able to get the help and
resources they needed because they did not have the
education to identify what they were experiencing. [The
testifier faded in and out during her testimony]. She
thought it was neglectful and a risk to Alaska youth not to
provide them with information that could potentially save
them. She reiterated her support for the legislation.
10:36:23 AM
Co-Chair Johnston CLOSED Public Testimony.
Co-Chair Johnston wanted to hold questions until after the
fiscal note was presented.
Representative Claman indicated he had some concerns with
the fiscal note.
LACEY SANDERS, ADMINISTRATIVE SERVICES DIRECTOR, DEPARTMENT
OF EDUCATION AND EARLY DEVELOPMENT, OFFICE OF MANAGEMENT
AND BUDGET, OFFICE OF THE GOVERNOR, reviewed the fiscal
note with OMB component number 2796. She detailed that the
cost associated with implementation of standards for the
Department of Education (DEED) consisted of a total of
$113,000 unrestricted general funds (UGF). The department
had requested a multi-year appropriation due to the 2-year
implementation covering FY 21 and FY 22. The fiscal note
contained 4 one-time multi-year expenses. The first expense
in the amount of $35,000 would pay for a year-long contract
with state of national subject matter expert with
experience facilitating the creation of the state health
education standards. The second expense in the amount of
$60,000 paid for travel for 20 to 30 representatives of
mental health organizations to convene in Anchorage for 2
separate 2-day meetings. The next expense was for $6,000
for legal services costs associated with producing new
regulations. Lastly, there was an expense of $12,000 for
the creation and printing and booklets of the new health
education standards that would be distributed to 500
schools, 54 school districts, and other health education
stakeholders. She noted that the fiscal note reflected the
department's standard request when implementing standards.
The department had implemented several standards in the
past and were being put forward currently. It reflected the
associated costs each time the department implemented new
standards.
10:39:11 AM
Representative LeBon asked what the expectation or the
responsibility of the Fairbanks School District would be to
the program. Ms. Sanders responded that the way the bill
was currently written the implementation of standards at
the school district level were optional. The Department of
Education and Early Development would develop the standards
and would present them to the State Board of Education for
approval. The department would then work with the school
districts to address any concerns.
Co-Chair Foster referred to Ms. Sanders' remark about the
fiscal note reflecting a multi-year appropriation. He saw
that money was only listed in the FY 21 column. He asked
for clarification.
Ms. Sanders replied that the fiscal note was a reflection
of the department's needs. The department identified the
appropriation as a multi-year appropriation. She continued
that the need is listed in the comment box and the analysis
on the second page of the fiscal note. She explained that
when the legislature reached the point of incorporating the
fiscal note appropriations that were approved for bills
into the appropriation bill, it would be up to the bill
drafters and the Legislative Finance Division to ensure
that there was a multi-year appropriation with an extended
lapse date. The fiscal note did not allow for the costs to
be broken out into a 2-year appropriation. Therefore, the
department put it all in the appropriation requested so
that it could get started on the work in FY 21. She
furthered that with an extended lapse date it would allow
the department 2 years to expend the money.
Co-Chair Johnston asked if Ms. Sanders was familiar with
HB 136. It had to due with public schools' social and
emotional learning. Ms. Sanders was only familiar with the
bill in name. She indicated Erin Harden might be able to
better speak to the bill referenced by Representative
Johnston.
Co-Chair Johnston relayed that the fiscal note for HB 131
was only $6,000. Ms. Sanders explained that the $6,000
Representative Johnston was referring to in HB 136 had to
do with the regulation work contracted out to the
Department of Law by DEED. The fiscal note reflected a cost
of $6,000 for regulation work related to HB 181. She
continued that because there were no existing standards for
mental health, additional work had to be completed to
implement them.
Co-Chair Johnston asked for confirmation that the $60,000
was to facilitate people convening together. Ms. Sanders
responded in the affirmative.
Co-Chair Johnson asked if the $12,000 appropriation was for
printing costs and the distribution of information. Ms.
Sanders replied, "Correct."
10:42:46 AM
Representative Wool asked about the $12,000 for 500 schools
and 54 school districts. He asked if the booklets were for
administrators rather than students. He did not think the
amount was very sizable to distribute booklets to many
places. Ms. Sanders replied that the amount was for the
purpose of distributing booklets to all of the 500 schools,
54 school district offices, and to any other additional
stakeholders.
Representative Wool asked if each school only received one
booklet. Ms. Sanders responded, "Yes."
Co-Chair Johnston requested that Representative Claman
return to the testifier table. She asked if there were
tools available in other states that would help eliminate
Alaska's need for a broadband conversation.
Representative Claman responded that Alaska was not unique.
The health education curriculum of the Centers for Disease
Control (CDC) did not contain information on mental health
either. However, the CDC had some resources equal to a few
pages about what they would recommend for guidelines for
mental health. Interestingly, the health guidelines that
Alaska currently had was on 2 pages. He was skeptical of a
$6,000 fiscal note in the current age of the internet. He
suspected mental health could be uploaded to the rest of
the health curriculums online. He thought several resources
were available. He also questioned the notion of having to
bring 20 to 30 people to Anchorage twice, especially with
the current budget challenges. He suggested the use of
telephonic meetings. He opined that updating the
information on mental health that was currently 2 pages
could be done for much less.
10:46:19 AM
Representative Josephson asked the sponsor about the
potential for expanding the school year. He asked how the
bill would affect on-the-ground activity. He requested that
the representative paint a picture of how the bill would
work. Representative Claman replied that the bill did not
create a separate mental health class. He recalled growing
up in high school that health was a one-semester class. If
the class was a 10-week class containing everything but
mental health, he thought the curriculum could fold into
the 10-week period. He cited an example of an annual exam
incorporating a question about a person's mental health.
Representative Wool thought there was more time devoted to
health classes. He indicated his kids were spending more
time in the classroom on the topic of health. He suggested
that the more curriculum that was expected to be taught,
the longer the class hours or days in the school year. He
wondered if any of the language prevented mental health
from being part of the classroom curriculum.
Representative Claman replied that presently there was
nothing preventing school districts from including mental
health in their curriculum. There was a number of school
districts that already provided different levels of mental
health education. He indicated the bill was about suicide
prevention. He though it was a worthy investment in time.
He understood the pressure of having to teach additional
curriculum. He thought it was a priority and would need to
be balanced with additional curriculum.
10:51:38 AM
Vice-Chair Ortiz appreciated the bill being presented. He
understood that the bill was not a mandate but was supposed
to bring a heightened awareness to mental health. He
wondered if it was still up to the district to fold in the
curriculum. He wondered what it would look like in terms of
process and implementation.
Representative Claman expected the districts to have the
conversation with the school board and the state. The
Department of Education and Early Development would provide
assistance to those school districts that wanted to add
mental health to their curriculum. He thought parents with
kids with mental health illnesses might push things along
as well.
10:54:47 AM
Representative Carpenter asked for the definition of mental
health. He suggested that it was the quality of a person's
thinking. He wondered if the curriculum would be testable
or measurable. He thought the video was a demonstration of
the need for healthy relationships with parents and other
people that influenced children. He was concerned with the
notion that the school would be responsible for
implementing additional curriculum without additional
support. He suggested the standards that would be required
to be set would essentially guide children on what was
appropriate to think. He suggested the bill was venturing
into the realm of parenting.
10:58:20 AM
Representative Sullivan-Leonard indicated that some of the
school nurses she had talked with shared the sentiments of
Representative Carpenter. She thought that many school
nurses were the first to hear from students about feeling
depressed or being bullied. She wondered who at each school
would be encapsulating and disbursing the mental health
information. She thought it would likely be school nurses.
She asked if the bill would remove the term, "physical
health" from the statute. Representative Claman responded
that the way to incorporate mental health was to remove the
word, physical. By doing so, it would allow the guidelines
to include mental health.
Representative Sullivan-Leonard wondered if the term should
remain in the statute, as physical education was a key
component to a child's health. She believed students
getting outside and doing something physical was essential
to having strong mental health. Representative Claman
thought physical health was a part of the current statute.
He continued that by removing the word, "physical" it did
not remove physical health from curriculum. He read a
portion of the bill. From his perspective, the language
undoubtedly included physical health.
11:01:30 AM
Representative LeBon had previously sat on the Fairbanks
School Board for 6 year. He indicated that in a similar
situation the school board would assign a topic to a
curriculum committee made up of parents. There was a full
vetting process that included family and parents.
Representative Claman agreed that school nurses were some
of the first people students approached. He had confidence
in nurses' medical training and the consistency of their
training.
Co-Chair Johnston invited Ms. Sanders to comment on the
remarks made regarding the fiscal note. Ms. Sanders replied
that the department understood that mental health standards
were missing from what was considered physical health
standards and supported implementing them. Today mental
health was a complex issue. The department believed it was
in the best interest of the students and the school
districts to ensure that experts were available to provide
input in the development of the standards. She admitted
that the department did not have the expertise within the
department to develop them on their own which was reflected
in the fiscal note.
11:04:30 AM
Representative Carpenter was looking at the intent language
of the bill. He read a portion containing a list of
organizations. He suggested that unless the organizations
involved parents and experts in the process of developing
standards, there was nothing in the bill that pointed to
parental involvement in determining the state's standards.
Representative Josephson noted that parents participated by
testifying before their local school boards. He argued that
there would be opportunities for parent involvement.
Representative Claman agreed that testifying before a
school board provided the most consistent opportunity for
parental involvement. He also noted that the members of the
State Board of Education were established in statute and
appointed by the governor. He thought board members were
consistently parents.
Representative Josephson questioned the role of the parents
surrounding mental health issues because, in some
instances, parents were a contributing factor to the
problem. He was not aiming to be critical of parents.
Representative Claman replied that parents were always an
issue according to Dr. Freud. Co-Chair Johnston thought the
topic was straying from the bill.
Representative Josephson did not think the bill was
designed to identify appropriate thoughts. Rather, the bill
was about providing a broad understanding that if a person
was feeling suicidal, a remedy was needed. He asked if he
was correct. Representative Claman replied in the
affirmative.
Representative Josephson thought if the bill was going to
work, the periods of instruction should provoke the need
for other referrals. It would give a student the confidence
to seek help which would create a positive downstream
effect but would require other resources.
11:08:47 AM
Representative Claman largely agreed. He elaborated that
the funding received by Alaska's Department of Military and
Veterans Affairs (DMVA) and by the U.S. Department of
Veterans Affairs had increased over time for psychiatric
services due to an increase in awareness. He shared a
personal story about a family member who had fought on
three islands in the Pacific, survived, and never went to a
psychologist. However, the way in which he interacted with
his colleagues he served with in the Marines in WWI
suggested that they all suffered from their own degree of
Post-Traumatic Stress Disorder. He thought as the
conversation changed people would look for resources that
they did not pursue in the past.
Representative Carpenter thought the conversation was
surreal. He had personally fought in two wars and had
spoken to a psychologist. He stated that the Department of
Defense had mandated annual suicide awareness training for
many years. However, the United States had very high rates
of suicide. He did not believe the training was lacking. He
suggested that the problem was effective relationships. He
suggested people turn to government to solve their
problems. They looked to schools and other institutions to
solve the problem which he identified as the failure. He
argued that people should be looking to each other and
effective relationships, not to government training
solutions. His opinion was based on his own experience.
Representative Wool referred to representative Josephson's
comments that the bill might create additional referrals.
He believed the curriculum might also help kids not to feel
alone or abnormal. He noted that many kids did not have
healthy homes. Even kids from good homes with well-balanced
families had mental illness.
Co-Chair Johnston commented that the committee had
participated in a robust discussion. She would be setting
the bill aside.
HB 181 was HEARD and HELD in committee for further
consideration.
11:13:15 AM
AT EASE
11:23:36 AM
RECONVENED
Co-Chair Johnston indicated the committee would consider
the governors appointee for commissioner of the Department
of Revenue, Lucinda Mahoney.
^CONSIDERATION OF GOVERNOR'S APPOINTEE: LUCINDA MAHONEY,
COMMISSIONER, DEPARTMENT OF REVENUE
11:23:56 AM
LUCINDA MAHONEY, COMMISSIONER DESIGNEE, DEPARTMENT OF
REVENUE, thought she would review her resume' and pertinent
experience. She asked the co-chair if that was acceptable.
Co-Chair Johnston responded in the affirmative.
Commissioner Designee Mahoney relayed that she attained a
Bachelor of Business Administration degree with a finance
concentration from the University of Texas. Later she
attained a Masters of Business Administration from the
University of Alaska Anchorage. She attended school while
working full time. She described herself as intellectually
curious and continued to pursue additional education. She
was a certified valuation analyst for conducting business
valuations for merger acquisitions. She also had an
investment portfolio certificate from Wharton School of
Business [University of Pennsylvania]. The certificate
pertained to investments and investment allocations. She
obtained investment training at the Callan Investment
Institute. She also obtained formal training in real
estate.
Commissioner Designee Mahoney started her career in the oil
industry in Alaska. She spent the majority of her time with
ARCO Alaska where she was responsible for many different
finance and accounting positions. Most Relevant, she worked
on the North Slope at Kuparuk and Prudhoe Bay as a business
manager. She was able to learn the operations of the field
and understand the oil industry. She worked on net income
forecasting and long-range planning. She worked on 30-year
plans or plans for the life of a field. She left ARCO to
begin a career at KPMG in the Advisory Services Department.
She was responsible for the development of a consulting
practice in Alaska and worked with many different entities
including village corporations, native regional
corporations, fisheries industries, and publicly-traded
telecommunication companies. It opened her eyes to the
various communities within Alaska. She worked in Barrow,
Nome, Seward, Fairbanks, and Anchorage. Her time at KPMG
provided her a great learning experience.
Commissioner Designee Mahoney moved to a position with
Arctic Slope Regional Corporation as the Executive Director
of the shared services organization. She was responsible
for much of the back-office operations in support of the
business units with the goal of attaining process
improvements and efficiencies. She left her position with
the regional corporation to start her own management
consulting company called, Value Solutions. She provided
consulting services much in line with what she did at KPMG
for similar types of clients.
11:27:56 AM
Commissioner Mahoney reported that in 2009 she was
contacted by Mayor Dan Sullivan to work as the Chief
Financial Officer for the Municipality of Anchorage. It was
her first job working in the public sector. All of her work
prior was in the private sector. The work environment at
the municipality was similar to working for the Department
of revenue. She started working for the Municipality of
Anchorage during the Great Recession and worked to help
develop a fiscal plan after reserves had been depleted and
revenues were down significantly. She and her team worked
diligently to evaluate sources of revenues, combinations of
revenues, potential reductions, and the possibility of
refinancing debt. Her team came up with a plan identifying
financial goals to create a culture of thrift and strict
discipline. The plan was implemented and the Municipality
of Anchorage ended up with surplus balances for several
years of her tenure. She was the financial face of the
organization meeting with the rating agencies, including
Standard and Poor's and Fitch, about the municipality's
financial condition. Over a period of years, it received
small credit upgrades eventually reaching a AAA rating. The
rating was a reflection of the collaboration of everyone
working together. The entities involved included the
political body, the administration, the operations
managers, and the finance department. She resigned from the
City of Anchorage in 2014 to spend more time with her
mother who had taken ill. She continued to do consulting
work through her company, Value Solutions.
Commissioner Mahoney relayed that in January she was
approached by the administration to serve as the
commissioner for the Department of Revenue (DOR). She noted
her concern that she might have a conflict of interest due
to her husband's work as an attorney for the oil industry.
She noted that the chief of staff for the governor
implemented a proper ethics shield in conjunction with the
Department of Law. The Deputy Commissioner, Mike Barnhill,
would handle anything that would otherwise be a conflict.
She intended to be involved in any process regarding
changes to the oil tax structure. She was excited to do her
best to help the state. She made herself available for
questions.
11:33:36 AM
Representative LeBon asked, given the economic activities
such as the price of oil and the stock market, if the
commissioner designee had an opinion on following the law
and a full Permanent Fund Dividend (PFD).
Commissioner Mahoney responded that it was the position of
the administration that the state followed the statutory
law associated with the PFD unless there was a change from
the vote of the people.
Representative Josephson asked about auditors having
sufficient access to files - he read a portion of the audit
prepared regarding the Department of Revenue and the
settlement of oil and gas taxes. He asked if the
commissioner would be more cooperative with the auditor
than the previous commissioner.
Commissioner Mahoney relayed that the incident occurred
prior to her appointment. She relayed that in December
[2019] the Department of Revenue advised Legislative Audit
in writing that it would provide the tax settlement files
that reversed the position of the previous commissioner.
Based on the advice of the Department of Law, DOR would not
disclose the attorney/client communications. It placed the
commissioner in a quandary because of the direction of the
Department of Law. However, she planned to discuss the
issue with Attorney General Clarkson as soon as she was
confirmed.
Representative Josephson asked if it was the commissioner
designee's understanding that her predecessor had taken a
position but, in December [2019] the administration became
more cooperative. Commissioner Mahoney responded, "Yes."
The files were provided other than the files which the
attorney/client privilege applied.
Representative Josephson thought it was typical that other
agencies of state government would not look at settlement
papers because of the nature of the documents. However, he
interpreted the auditor's comments indicating she could not
see the documents relative to the reduction in tax credits
owed. He asked if the commissioner was sensitive to her
position.
Commissioner Mahoney replied in the affirmative. She
provided an example working for the Municipality of
Anchorage. When she addressed entities on Wall Street, she
had to address questions regarding the caffer. She valued
the importance of numbers being accurate. In the particular
case being addressed, she could not review the detail
because of the ethics screen associated with any of the tax
settlements. However, she would be able to work with the
attorney general to better understand the Department of
Law's position regarding disclosing the attorney/client
communications. After she researched the issue, she could
determine whether it was appropriate to release the
information. She would want to work collaboratively with
Attorney General Clarkson and potentially influence him
about the importance of transparency in the caffer.
11:39:25 AM
Representative Josephson inquired about the State
Assessment Review Board. It was his understanding that Mr.
Greeley was the state assessor and would be working for
Commissioner Designee Mahoney. He had learned a significant
amount about the State Assessment Review Board while
serving as a member of the legislature. Between 2013 to
2015 there was constant media coverage about litigation
regarding the state's property and equipment valuation. The
wide disparity was about $10 billion. The industry reported
assets of $5 billion rather than $10 billion. He wondered
if Mr. Greeley would be given the latitude to do his job.
Commissioner Mahoney responded that under the ethics screen
she would not be overseeing those issues at all. However,
her general expectation would be that Mr. Greeley would
perform his functions independently and conduct his
evaluations in compliance with state statutes.
Vice-Chair Ortiz thanked Commissioner Designee Mahoney for
being available. He wondered about her experience working
for the City of Anchorage. One of the things she spoke
proudly of was helping to implement a proper fiscal plan.
He noted the state's untenable fiscal situation. He
wondered if she saw herself playing an active role in
helping the state resolve its fiscal plan. Commissioner
Mahoney responded that she absolutely wanted to be involved
and would be looking at all fiscally sustainable solutions.
Vice-Chair Ortiz understood her role would require good
communication. He asked her to comment on how she thought
the state could resolve its fiscal situation. Commissioner
Mahoney indicated her view was complicated. From a high-
level perspective, she would look at all revenue sources
for consideration. She would also evaluate expenditure
downward pressures. She would look at what kind of
government services the state wanted to continue to
provide. Additionally, she would consider the state's debt
and bonds. She noted the current low interest rates. She
thought the state might have an opportunity to refund and
refinance its bonds. Bringing interest rates down would
provide more leverage for capital projects. The fiscal plan
would include a combination of things.
11:45:28 AM
Vice-Chair Ortiz noted her mentioning the need to put
downward pressure on government expenditures. He asked her
to speak about what the state was trying to do to support
government services. He asked her whether she thought the
state was providing too many services. Commissioner Mahoney
indicated that it would be difficult for her to comment, as
she would need to take a thorough look at each department
first. She noted that any kind of reductions needed to be
done with significant care and consideration.
Representative Wool noted the presentation from the prior
day's hearing. He wondered if the commissioner would
support an unscheduled draw to pay for a full PFD.
Commissioner Mahoney could not comment without further
information.
Representative Wool asked if she spent any time studying
sovereign wealth funds. Commissioner Mahoney replied that
she primarily studied the subject of portfolio investment
analysis while attending Wharton School of Business. She
received training in asset classes and fund allocations to
minimize risk.
Representative Wool clarified that she was responding in
the negative about being trained on the topic of sovereign
wealth funds. Commissioner Designee responded in the
negative.
Representative Wool noted Deputy Commissioner Barnhill
presented a bill earlier in the week to backpay PFD
amounts. The money would come out of the Earnings Reserve
Account. He looked forward to her comments on the subject
when she was ready.
11:49:50 AM
Co-Chair Johnston OPENED Public Testimony.
11:50:01 AM
Co-Chair Johnston CLOSED Public Testimony.
Vice-Chair Ortiz indicated that the House Finance Committee
had reviewed the qualifications of the governor's appointee
and recommended the following name be forwarded to the
joint session for consideration:
Lucinda Mahoney, Commissioner, Department of Revenue
Representative Ortiz continued that forwarding the name did
not reflect by any of the members an intent to vote for or
against this individual during any further sessions for the
purpose of confirmations.
Co-Chair Johnston reviewed the agenda for the afternoon and
evening. The committee would be hearing public testimony
for HB 300 and HB 306. She provided details regarding
public testimony.