Legislature(2015 - 2016)SENATE FINANCE 532
04/12/2016 01:30 PM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB128 | |
| HB188 | |
| HB83 | |
| HB289 | |
| HB231 | |
| HB268 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 128 | TELECONFERENCED | |
| + | HB 188 | TELECONFERENCED | |
| + | HB 83 | TELECONFERENCED | |
| + | HB 289 | TELECONFERENCED | |
| + | HB 231 | TELECONFERENCED | |
| + | HB 268 | TELECONFERENCED | |
| + | TELECONFERENCED |
CS FOR HOUSE BILL NO. 188(FIN)
"An Act establishing a program for financial accounts
for individuals with disabilities; exempting the
procurement of contracts for the program from the
State Procurement Code; exempting certain information
on participants in the program from being subject to
inspection as a public record; providing that an
account under the program for an individual with a
disability is not a security; allowing a state to file
a claim against an individual's financial account
under the program to recover Medicaid payments after
the individual's death; and providing for an effective
date."
2:32:27 PM
REPRESENTATIVE DAN SADDLER, SPONSOR, introduced the
legislation and read from the Sponsor Statement:
HB 188 seeks to help Alaskans cope with the challenges
of living with a disability by allowing individuals
and families to set up tax-free savings accounts,
called "ABLE accounts," to pay for education, housing,
transportation or other disability-related expenses.
The U.S. Congress passed the "Achieving a Better Life
Experience (ABLE) Act" in 2014, authorizing states to
create special savings accounts for disability-related
expenses modeled after the successful "529 college
savings programs," named after the relevant section of
IRS code.
ABLE accounts, also known as "529A" accounts, allow
individuals with disabilities to improve their
financial security by using private investments to
supplement their benefits from insurance, employment,
Supplemental Security Income (SSI), Medicaid, and
other sources. Assets held in an ABLE account would
not be counted under means tests required for Medicaid
or SSI, although SSI cash benefits would be suspended
if the ABLE balance exceeded $100,000.
ABLE accounts could be spent for education,
transportation, job training and support, assistive
technology, health and wellness, legal and other
qualified services. Contributions would be limited to
$14,000 per year, and capped at $400,000. A person
could have only one account.
To be eligible for an ABLE account, a person must have
become blind or disabled before the age of 26. The
Governor's Council on Disabilities and Special
Education estimates that about
13,770 Alaskans - 10 percent of those with a
disability - might qualify for ABLE accounts.
By empowering Alaskans with disabilities and their
families to build their financial independence, HB 188
will help them meet more of their life challenges by
relying on private resources, without eroding the
value of public benefits to which they are entitled.
ABLE accounts will be important tools for helping them
live full, productive lives in their communities.
Representative Saddler divulged that the bill had evolved
during the legislative process to make sure that money in
ABLE account was not unavailable to creditors should the
account holder go bankrupt or fail to pay their debts. He
noted that there were specific benefits to having a state
authorized ABLE account; first, by passing the bill Alaska
could join a consortium of other states in obtaining the
economies of scale and lower account fees for account
holders. Secondly, Alaskans could go to DOR directly if
there were problems with their accounts. He said that the
contribution limits would be matched to the college savings
plan; $400,000, the highest in the nation. He concluded
that passage of the bill would demonstrate concern for
disables Alaskans by providing them a way to improve their
lives, without increasing any state costs.
2:36:31 PM
Senator Olson wondered how many people were expected to
take advantage of the program.
Representative Saddler replied that it was estimated that
there were 130,000 disabled Alaskan residents, 10 percent
of which would qualify for the program.
2:36:53 PM
Senator Olson wondered whether the program would negatively
impact the resources for those who did not qualify for the
program and relied on support from the Department of Health
and Social Services (DHSS).
Representative Saddler stated that the program would have
no effect on the DHSS budget or the resources for others.
He asserted that this would be an opportunity for people
who would create the accounts to deposit private funds. He
thought that the program could benefit DHSS.
2:37:39 PM
Vice-Chair Micciche noted that the costs associated with
the bill would be covered by the Alaska Mental Health Trust
Authority (AMHTA).
Representative Saddler replied in the affirmative. He
furthered that many of the beneficiaries of AMHTA were
disabled and would benefit from the legislation. He said
that after initial implementation, fees would support the
program at no cost to the state.
2:38:22 PM
Co-Chair MacKinnon requested a Sectional Analysis.
2:38:43 PM
AT EASE
2:39:33 PM
RECONVENED
2:39:40 PM
KIM SKIPPER, STAFF, REPRESENTATIVE DAN SADDLER, discussed
the Sectional Analysis (copy on file):
Sec. 1: Cites this as the Alaska ABLE Act Savings
Program Act
Sec. 2: Creates a new chapter 65. Alaska Savings
Program for Eligible Individuals
Sec. 06.65.010: Program authorized. Authorizes
Alaska ABLE savings program in the Department -
which is the Alaska Department of Revenue. Allows
it to implement and administer the program under
the Federal ABLE Act.
Sec. 06.65.020: General department duties.
Outlines the duties of the department in
implementing and administering the program.
Sec. 06.65.030: Modification of program. Gives
the Department authority to modify the program in
accordance to any federal law changes
Sec. 06.65.040: Additional department powers.
Allows department to set fees for program
transactions and services and also develop
marketing plan to promote the ABLE program
Sec. 06.65.050: Contracting authority;
procurement exemption. Allows department to
contract with a person to assist in implementing
the program, provide services, join other states
to obtain or provide services for implementation,
join a cooperative effort with other states to
provide services for the program that could
include investment and record-keeping services.
Allows state to join with other states to allow
an Alaska resident to participate in a program in
another state under federal authorizing law and
for an outside state to participate in a program
in this state. If contracting with another state,
AS 36.30 (Procurement Code) will not apply.
Sec. 06.65.060: Investment oversight: Allows the
department to oversee and approve selection of
investment managers and advisors for the program,
and to oversee all investment disclosures and
regulatory filings related to program investments
Sec. 06.65.070: Financial contractor obligations:
outlines duties/obligations of the selected
financial contractor(s)
Sec. 06.65.080: Additional audits: Allows the
department to order an audit of the contractor's
financial operation and position in addition to
annual audit if the department has reason to be
concerned
Sec. 06.65.090: Contract termination; non-
renewal. Gives department authority to not renew
a financial contract. If so it would take custody
of the program accounts and transfer them to
another financial contractor that offers similar
program accounts
Sec. 06.65.100: Eligible individuals. Describes
who is eligible to participate in the program.
Sec. 06.65.110: Representative of eligible
individuals. Describes who may act as a
representative of the eligible individual who is
a minor or lacks decision-making capacity
Sec. 06.65.120: Program account ownership. States
that the owner of the program account is the
designated beneficiary.
Sec. 06.65.130: Number of program accounts.
Allows only one program account per designated
beneficiary under federal authorizing law.
Sec. 06.65.140: Program account application:
Outlines department procedures for program
account applications and information to be
collected in that process
Sec. 06.65.150: Program account establishment
fee. Allows financial contractor to charge a non-
refundable to establish program account. That fee
to be determined in the contract with the
financial contractor.
Sec. 06.65.160: Program account contributions.
Outlines how a person can make a contribution,
the limit authorized by federal law, allows
department to reject or withdraw a contribution
that exceeds that annual limit or maximum limit
established by authorizing law or if designated
beneficiary is not eligible, and that financial
contractor must report contributions to the IRS.
Sec. 06.65.170: Limited investment direction.
Limits to two the number of times a program
account investment can be changed.
Sec. 06.65.180: Change of designated beneficiary.
Allows a designated beneficiary or representative
to change beneficiary of an account to another
eligible individual in the family.
Sec. 06.65.190: Distribution for qualified
expenses. States that withdrawals from the
program accounts may only be used for qualified
expenses for the designated beneficiary.
Sec. 06.65.200: Rollover distribution. Subject to
federal law governing rollovers, a distribution
from a program account can be made to the same
designated beneficiary or another eligible
individual in the family, and the timeframe for
that to be done.
Sec. 06.65.210: Statements. Requires that
statements re: program accounts be issued 4 times
a year at times established by the department and
that the program contractor provide related
information at the department's request.
Sec. 06.65.220: Preparation and filing. In
addition to other reports a financial contractor
shall prepare and file statements required under
state and federal law and other agencies.
Sec. 06.65.230: Separate accounting. Requires a
financial contractor to provide separate
accounting for each program account.
Sec. 06.65.240: Annual fee. Allows a financial
contractor may charge an annual fee for
maintenance of a program account.
Sec. 06.65.250: Use as security. Prohibits a
program account from being used as security for a
loan
Sec. 06.65.260: No state obligation. Declares
that the program does not create an obligation of
the state, department, or any agency to guarantee
the return of principal or pay interest on the
principal in a program account
Sec. 06.65.270: Confidentiality. Specifies that
program account information is confidential
Sec. 06.65.280: Exchange of information. Allows
the Department to exchange information with the
Department of Health and Social Services and
other state agencies to determine whether an
individual is eligible
Sec. 06.65.290: Treatment under means test
programs. Specifies the program account amounts
must be disregarded in determining eligibility
for means-tested programs
Sec. 06.65.300: Deposit from permanent fund
dividend. Allows deposits to program accounts
from the permanent fund dividend
Sec. 06.65.310: Program expense fund. Establishes
program expense fund and describes it purpose and
operation
Sec. 06.65.320: Medicaid claims: Allows that the
state may file a claim against the program
account of a beneficiary who dies.
Sec. 06.65.330: Governing law. Establishes
federal law as governing to the extent of any
conflict with state law
Sec. 06.65.340: Regulations. Requires the
department to adopt implementing regulations
Sec. 06.65.350: Annual report. Requires the
department to evaluate the program each year and
file an annual report on or before the start of
each legislative session beginning in 2018
Sec. 06.65.390: Definitions.
Sec. 3: AS 36.30.850(b): Adds ABLE program account
oversight as a responsibility of the Commissioner of
Revenue
Sec 4: AS 40.25.120(a) is amended to create an
exception to public inspection for names, addresses,
and other program account identifying information
Co-Chair MacKinnon queried the location of the Section 4
within the bill.
[Section 4 was located on Page 11.]
2:45:39 PM
AT EASE
2:46:29 PM
RECONVENED
2:46:58 PM
Ms. Skipper continued to discuss the Sectional Analysis:
Sec. 5: AS 45.55.990(32): Excludes program accounts
from the definition of "security"
Sec. 6: AS 47.07.055: Allows the state to file a claim
against the designated beneficiary's program account
after the individual dies
Sec. 7: Transition
Requires the Department to file its first report
on the program on or before the first day of the
Second Regular Session of Thirtieth Alaska State
Legislature (2018)
Sec. 8: Transition
Allows the Department to adopt regulations, but
not before the effective date of the provisions
authorizing the Alaska ABLE savings program
Sec. 9: Effective Date
Section 8 takes effect immediately
2:48:02 PM
Co-Chair MacKinnon CLOSED public testimony.
2:48:24 PM
STUART SPIELMAN, AUTISM SPEAKS, WASHINGTON DC (via
teleconference), testified in support of the legislation.
He stated that 40 states had enacted similar legislation.
Co-Chair MacKinnon wondered whether DHSS had any comments
or concerns pertaining to the bill.
2:49:20 PM
MARGARET BRODIE, DIRECTOR, DIVISION OF HEALTH CARE
SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES,
ANCHORAGE (via teleconference), testified that there was a
potential benefit to the department because over time the
amount that the department would spend for disabled
individuals could decrease.
2:50:08 PM
Co-Chair MacKinnon asked whether the administration
supported the bill.
Ms. Brodie replied that the administration supported the
legislation.
2:50:26 PM
KRISTEN VANDAGRIFF, ALASKA GOVERNORS COUNCIL ON
DISABILITIES AND SPECIAL EDUCATION, ANCHORAGE (via
teleconference), spoke in support of the bill. She said
that the bill would be a great tool for individuals and
their families to be more independent and self-sufficient,
and to be able to join the workforce.
CSHB 188(FIN) was HEARD and HELD in committee for further
consideration.
2:51:12 PM
AT EASE
2:53:10 PM
RECONVENED