Legislature(2023 - 2024)ADAMS 519
03/06/2024 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB268 || HB270 | |
| Subcommittee Closeout Reports | |
| Department of Transportation and Public Facilities | |
| Department of Fish and Game | |
| Department of Administration | |
| 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 | |
| += | HB 270 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
HOUSE BILL NO. 268
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs; capitalizing funds; amending
appropriations; making capital appropriations; making
supplemental appropriations; making reappropriations;
making appropriations under art. IX, sec. 17(c),
Constitution of the State of Alaska, from the
constitutional budget reserve fund; and providing for
an effective date."
HOUSE BILL NO. 270
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
2:04:02 PM
^SUBCOMMITTEE CLOSEOUT REPORTS
2:04:07 PM
^DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES
2:04:11 PM
Representative Tomaszewski asked his staff to provide the
subcommittee report for the Department of Transportation
and Public Facilities (DOT).
DAVID GOFF, STAFF, REPRESENTATIVE FRANK TOMASZEWSKI,
reviewed the finance subcommittee recommendations for the
Department of Transportation and Public Facilities (copy on
file):
The House Finance Budget Subcommittee for the
Department of Transportation held a total of four
meetings and submits the following recommended
operating budget for FY 25 to the House Finance
Committee:
RECOMMENDATIONS:
Fund Source: (dollars are in thousands)
Unrestricted General Funds (UGF) $176,635.6
Designated General Funds (DGF) $70,395.6
Other Funds $441,465.6
Federal Funds $78,740.7
Total $767,237.3
Compared to the FY 25 adjusted base, the subcommittee
recommendations represent an increase of $21,476.1
million (+.13.8 percent) in Unrestricted General
Funds, $25.5 thousand (+0.0 percent) in Designated
General Funds, an $11,238.95 million (-2.5 percent)
decrease of other funds, as well as a decrease of
$9,827.1 million (-11.1 percent) in Federal Funds for
a total increase of $435.6 thousand (0.1 percent) all
funds.
Positions:
Permanent Full-time 3011
Permanent Part-time 281
Temporary 147
Total 3,439
Representative Tomaszewski clarified the total DGF increase
was $25,500.
Mr. Goff continued reviewing the subcommittee
recommendations.
BUDGET ACTION:
After reviewing and discussing each of the Governor's
proposed transactions in detail, the subcommittee
adopted all items by unanimous consent.
Some of the highlights of these items are:
• Commodity increases in all three regions to
adjust for inflation - $4,578.0 (UGF)
• Fund change from one-time COVID federal relief
funding to General Fund - $9,827.1 (UGF)
• Airport lighting repairs - $626.5 (UGF)
• Increase utilities cost - $1,309.2 (UGF)
• Increase share of billed contract work for tunnel
maintenance - $2,875.0 (UGF)
• Alaska Marine Highway operating budget may have a
large budget deficit based on unknown federal
grant funding levels.
• Create a new allocation for contracted statewide
snow removal- $915.5 (UGF)
SUBCOMMITTEE AMENDMENTS:
The Chair set an amendment deadline, welcomed
amendments from all members, and the committee
received three amendments. After discussion, none of
the amendments were adopted.
ATTACHED REPORTS
The House Finance Budget Subcommittee for the
Department of Transportation and Public Facilities
adopted the attached reports:
• DOT&PF Agency Totals
• DOT&PF Transaction Compare: Adjusted Base + to
House Subcom
• Wordage
2:09:43 PM
Co-Chair Johnson remarked the intent was to hear the
subcommittee reports and not to go back through what the
subcommittees had done.
Representative Ortiz referenced the above bullet point
specifying that the Alaska Marine Highway System (AMHS) may
have a large deficit. He asked for a ballpark figure of the
potential deficit.
Mr. Goff answered the projected budget gap for FY 25 was
$37,958,000.
^DEPARTMENT OF FISH AND GAME
2:11:10 PM
Representative Cronk asked his staff to provide the
subcommittee report for the Department of Fish and Game.
SUE STANCLIFF, STAFF, REPRESENTATIVE MIKE CRONK, reviewed
the finance subcommittee recommendations for the Department
of Fish and Game (copy on file):
The House Finance Budget Subcommittee for the
Department of Fish and Game held a total of three
meetings, and submits the following recommended
operating budget for FY 25 to the House Finance
Committee:
RECOMMENDATIONS:
Fund Source: (dollars are in thousands)
Unrestricted General Funds (UGF) $63,435.9
Designated General Funds (DGF) $12,670.9
Other funds $76,906.0
Federal funds $95,516.3
Total $248,529.1
Compared to the FY 25 Adjusted Base, the Subcommittee
recommendations represent a decrease of $1,167.1
million (-1.8 percent) in Unrestricted General Funds,
a decrease of $673.5 thousand (-5.0 percent) in
Designated General Funds, an increase of $5,412.1
million in Other state funds (7.6 percent), and an
increase of $5,250.0 million (5.8 percent) in Federal
funds, for a total increase of $8,821.5 million (3.7
percent) for all fund sources.
Positions:
Permanent Full-time 843
Permanent Part-time 594
Temporary 1
Total 1,438
BUDGET ACTIONS:
After reviewing and discussing each of the Governor's
proposed transactions in detail, the Subcommittee
adopted the Governor's proposed FY 25 operating budget
without objection, and with the addition of intent
language and the following modifications:
• Commercial Fisheries: Added $150.0 to the Central
Region Fisheries Management allocation in support
of the Upper Cook Inlet test fishery. The
Subcommittee also denied the removal of a
Temporary Increment for CFEC IT systems upgrades
which the Governor proposed to replace with a
Multiyear in language. This can be addressed in
the full House Finance Committee.
• Anchorage and Fairbanks Sport Fish Hatcheries:
Changed base operating funding from $5,000.0 of
UGF to $5,000.0 in Federal funds to leverage
Dingell-Johnson receipts. The Subcommittee also
modified the fund source of a $350.0 Increment
for utilities cost increases from UGF to Federal
receipts.
• Subsistence: Added $250.0 UGF and 1 PFT position
to restore the Director of Subsistence to re-
establish Subsistence as a division. The
Subcommittee also modified location of two
Resource Specialist from Wildlife Conservation to
Subsistence. The positions are funded with I/A
receipts in the amount of $300.0.
Added Intent Language:
• It is the intent of the Legislature to restore
Subsistence as a Division, and that the agency
shall report to the Co-chairs of Finance and the
Legislative Finance Division on the status of
these efforts by December 20, 2024.
• It is the intent of the Legislature that the
agency shall provide a report detailing the
activities of the Marine Mammal Protection
Program and the threatened and Endangered Species
Program to the Co-chairs of Finance and
Legislative Finance Division by December 20,
2024.
SUBCOMMITTEE AMENDMENTS:
The Chair set an amendment deadline, welcomed
amendments from all members, and the committee
received one amendment; that amendment was not
adopted.
ATTACHED REPORTS
The House Finance Budget Subcommittee for the
Department of Fish and Game adopted the attached
reports:
• DFG Agency Totals
• DFG Transaction Compare: Adjusted Base to House
Subcom
• DFG Transaction Compare: GovAmend to House Subcom
• DFG Wordage
2:16:21 PM
Representative Cronk spoke to the importance of subsistence
to rural Alaska. He thought the absence of a subsistence
division and director was a slap in the face. He did not
expect there to be a traditional subsistence director. He
remarked "we are far beyond having an anthropologist or
customary and traditional use person." He stated the
department needed someone who understood the myriad issues
including the introduction of bison, the Alaska National
Interest Lands Conservation Act (ANILCA), intensive
management, and working with tribes. He stressed the
importance of subsistence across the state.
2:17:44 PM
Co-Chair Edgmon supported intent language. He suggested
adding the words "shall provide and report" to the first
intent language to align with the second intent language.
Co-Chair Johnson stated she would figure out the change
with the permission of the subcommittee chair.
Representative Stapp asked about the fund source change
from $5 million in general funds to federal receipts. He
thought it looked like general funds and no match. He asked
if there were existing funds or if the subcommittee was
adding receipt authority to obtain federal funds.
Ms. Stancliff asked for clarification on the item.
Representative Stapp replied that he was looking at
subcommittee item 32. He read from page 3 of the Budget
Analysis sheet provided by Representative Cronk's office
(copy on file):
Fund source change to leverage available federal
Dingle Johnson funding for sport fish hatchery
operations.
Ms. Stancliff confirmed that the increment pertained to
[federal] Dingle Johnson funds the department already had.
2:19:51 PM
Representative Ortiz was very supportive of language
regarding a return to a subsistence division. He asked if
there had been any discussion on the benefit of restoring a
habitat division. He highlighted issues pertaining to
salmon in the western part of the state and warming ocean
temperatures. He noted that the previous habitat division
had been removed at the same time as the removal of the
subsistence division.
Representative Cronk answered that the subcommittee had not
discussed the idea.
Representative Hannan asked if there had been any
discussion about invasive species that may intersect with
subsistence.
Ms. Stancliff answered there had been an at length
discussion, but she did not recall a specific attached
amount. She noted the department was active on the issue.
Representative Hannan supported the restoration of a
division of subsistence. She believed the department would
start to talk about habitat, invasive species, and other
issues "we may have been in denial over."
Ms. Stancliff thanked Representative Hannan for the
comment. One of the things that the subcommittee had
struggled with was related to the current lack of oversight
of those items as they pertained to subsistence.
^DEPARTMENT OF ADMINISTRATION
2:22:20 PM
Representative Coulombe asked her staff to review the
subcommittee report for the Department of Administration
(DOA).
EDRA MORLEDGE, STAFF, REPRESENTATIVE JULIE COULOMBE,
reviewed the finance subcommittee recommendations for the
Department of Administration (copy on file):
The House Finance Budget Subcommittee for the
Department of Administration reviewed the Governor's
FY25 budget proposal and recommends the items
contained in the below details.
RECOMMENDATIONS:
Fund Source:
Unrestricted General Funds (UGF) $87,648,100
Designated General Funds (DGF) $33,031,500
Other Funds $199,831,500
Federal Funds $1,243,600
Total $321,754,700
Compared to the FY25 Adjusted Base, the Subcommittee
recommendations represent:
• An increase of $964,000 (1.1 percent) in
Unrestricted General Funds (UGF)
• An increase of $285,100 (0.9 percent) in
Designated General Funds (DGF)
• A decrease of $1,132,100 (-0.06 percent) in Other
Funds
• A decrease of $214,000 (-14.7 percent) in Federal
funds
• For a total net decrease of $97,000 (0.0 percent)
Positions:
Permanent Full-Time 1181
Permanent Part-Time 7
Temporary 25
Total 1213
BUDGET ACTION:
After holding five meetings, reviewing and discussing
each of the Governor's proposed transactions in
detail, the Subcommittee adopted the Governor's
proposal with the following changes:
The subcommittee approved a request for $45,000 for
large screen monitors to assist Payroll Section
employees with the need to operate three programs
simultaneously, helping to ensure timeliness and
accuracy of processing payroll for State employees.
The subcommittee removed $50,000 in Other Funds for
recruitment and retention for the Payroll Section,
leaving intact $600,000 in I/A receipt authority.
BUDGET HIGHLIGHTS:
• $525,000 in Unrestricted General Funds (UGF) to
offset a 5 percent salary increase for exempt and
partially exempt employees, and an additional 15
percent for attorneys in the Office of
Administrative Hearings.
• $600,000 in I/A Receipt Authority for recruitment
and retention incentives to Payroll staff.
• $180,000 in One-time Unrestricted General Funds
(IncOTI UGF) to move the Payroll Section to the
State Office Building.
• $1,030,000 for cost increases for Microsoft
licensed products.
• Replace $214,000 Federal Grant Receipt Authority
(Other Funds) with Unrestricted General Funds
(UGF) for the Court Appointed Special Advocate
(CASA) Program.
• $411,000 in Unrestricted General Funds (UGF) for
two temporary Public Guardians and two support
staff for the Office of Public Advocacy.
SUBCOMMITTEE RECOMMENDATIONS:
• It is recommended that the amendment adopted in
subcommittee for large screen monitors have a
fund source change to Interagency Receipts,
allowing the agency to include it in their rate
structure. Further, it is recommended this item
be designated as a One-time Item (IncOTI).
• It is also the intent of the Chair to recommend
the Office of Public Advocacy be moved to the
Department of Family and Community Services, and
the Division of Motor Vehicles be moved to the
Department of Community and Economic Development,
in an effort to move the department toward
focusing solely on shared and centralized
services.
• It is also recommended that the Department of
Administration provide information to the full
House Finance Committee on the effectiveness of
the payroll incentives that were provided in the
last two fiscal years, including information on
how many individuals were affected, how many of
those were ultimately recruited as a result of
the financial incentives, and provide the
retention data of each individual affected by the
incentives. This would assist the legislature in
determining the appropriate amount of financial
incentives, or what other action should be taken,
to recruit and retain employees in the Payroll
Section.
SUBCOMMITTEE AMENDMENTS:
The Chair set an amendment deadline, welcomed
amendments from all members, and the committee
entertained three amendments, two of which were
adopted as noted above.
ATTACHED REPORTS:
The House Finance Budget Subcommittee for the
Department of Administration adopted the attached
reports:
• Agency Totals
• Transaction Compare: Adjusted Base to House
Subcommittee
• Transaction Compare: Governor's Amended to House
Subcommittee
• Wordage
2:28:19 PM
Representative Josephson asked about the $50,000 reduction
from the governor's request for recruitment and retention
incentives. He looked at the increment adding funding for
large screen monitors. He asked for details on the
subcommittee dialogue.
Representative Coulombe answered that one of the
subcommittee members had met separately with the DOA
payroll manager and had asked what one thing would help the
person do the job. The answer had been larger screens.
Currently the manager was working on one 22-inch screen,
which was challenging and time consuming. She gathered the
screens had been found in storage and given to payroll. She
relayed that the subcommittee member had asked her if there
was any way to provide the screens to make payroll more
efficient. She remarked there were questions as to whether
the payroll incentives were working and being put out
correctly. She thought the tools people needed to do their
jobs were more important; therefore, she had made a
decrement to the incentives in order to pay for the
screens.
Representative Josephson looked at the 5 percent salary
increase for exempt and partially exempt employees. He
asked if it was in anticipation of a bill that may require
a pay hike.
Representative Coulombe asked if Representative Josephson
was referring to the $525,000 increment.
Representative Josephson responded affirmatively.
Representative Coulombe responded that it stemmed from a 5
percent increase for attorneys the previous year. She
explained that DOA did not correct the amount it was
charging other departments for the services and the mistake
had been identified too far into the year. The department
helped school districts and municipalities and did not want
to throw everyone for a loop mid-year; therefore, the
department was requesting UGF to pay the difference and the
increment would be adjusted the next year. She deferred to
the Legislative Finance Division for more detail.
2:31:26 PM
ROB CARPENTER, DEPUTY DIRECTOR, LEGISLATIVE FINANCE
DIVISION, explained that the agency had received
considerable increases the previous year (a combination of
20 percent for its attorneys), which caused the Office of
Administrative Hearings to increase its rates to compensate
for the salary increase. He explained that the office had
raised rates from approximately $230 to $270, which was a
fairly impactful increase to agencies being served. The
[$525,000] increment was a way to soften the blow.
Representative Josephson thought the salary increase the
previous year merely used more UGF. He did not know why it
would require a rate adjustment.
Mr. Carpenter answered that the attorney pay increase had
been made across the board and the Office of Administrative
Hearings had not received any money in the fiscal note. The
agency generally billed out its services.
Representative Josephson stated they were not typical
employees. He understood that the Office of Administrative
Hearings did things like workers' compensation deals. He
asked for an example of why those attorneys could be
treated differently than a prosecutor.
Mr. Carpenter answered that he could not say why they
should be treated differently; it was a policy decision.
Co-Chair Edgmon lauded the subcommittee for finding $45,000
to affect a major change for processing payroll for state
employees.
2:33:57 PM
Representative Hannan thanked Representative Coulombe and
stated she had enjoyed serving on the subcommittee. She
referenced the language about moving the Office of Public
Advocacy [to the Department of Family and Community
Services] and the Division of Motor Vehicles (DMV) [to the
Department of Commerce, Community and Economic
Development]. She asked if there had been any similar
dialogue or consideration given to [moving] the Public
Defender Agency in order to limit the scope of DOA's work
to a shared services duty.
Representative Coulombe answered she was trying to
incrementally suggest things. The recommendation had
started with the Office of Public Advocacy. She explained
that the commissioner had been clear the office needed more
support. She had reached out to [Department of Family and
Community Services] Commissioner Kim Kovol who had stated
the office would fit better in her department. She agreed
that the Public Defender Agency likely did need to move,
but she had selected two obvious agencies to include in her
recommendation.
Representative Cronk asked if there had been any request
for additional money for retaining workers at DMV. He
highlighted that Tok was the first place across the border,
and it was inundated with traffic. He remarked that it was
difficult to retain employees there.
Representative Coulombe recalled the department had stated
the vacancy rates were low and stable. The subcommittee did
not receive a breakdown pertaining to specific DMV
locations. She added that the department did not request
any funding specifically for employee retention for DMV.
^DEPARTMENT OF REVENUE
2:36:21 PM
MATT GRUENING, STAFF, REPRESENTATIVE DELENA JOHNSON,
reviewed the finance subcommittee recommendations for the
Department of Revenue (copy on file):
The House Finance Budget Subcommittee for the
Department of Revenue held a total of three meetings
and submits the following recommended operating budget
for FY 25 to the House Finance Committee:
RECOMMENDATIONS:
Fund Source: (dollars are in thousands)
Unrestricted General Funds (UGF) $32,411.9
Designated General Funds (DGF) $2,456.3
Other Funds $339,419.9
Federal Funds $89,356.5
Total $463,644.6
Compared to the FY 25 adjusted base, the
subcommittee's recommendations represent an increase
of $2,662.3 million (+8.9 percent) in unrestricted
general funds, $5,605.1 million (+1.7 percent) in
other funds, $560.0 thousand (+.6 percent) in federal
funds, as well as a decrease of $13.4 thousand (-.5
percent) in designated general funds. Compared to the
Governor's proposed FY 25 amended budget, the
subcommittee's recommendations represent an increase
of $133.5 thousand (+.4 percent) in unrestricted
general funds and a decrease $1,359.0 million (-.4
percent) in other funds for an overall decrease of
$1,225.5 million (-.3 percent) in all funds.
Positions:
Permanent Full-time 836
Permanent Part-time 24
Temporary 23
Total 883
BUDGET ACTION HIGHLIGHTS:
After reviewing and discussing each of the Governor's
proposed transactions in detail, the following items
were amended, added, or removed by unanimous consent
of the subcommittee (dollars are in thousands):
• Added funding to support a long-term care
assistant ombudsman position ($133.5 GF/MH)
within the Alaska Mental Health Trust Authority
(AMHTA). This recommendation by AMHTA was not
included in the Governor's budget.
• Partially funded the Alaska Permanent Fund
Corporation's (APFC) $100.0 travel request at
$30.0. The subcommittee's reduction of $70.0
reflects the travel costs associated with the
Anchorage satellite office.
• Denied APFC's request for $60.0 in lease and
technology support costs associated with the
Anchorage satellite office.
• Partially funded APFC's request of $50.0 for
furniture, supplies, and equipment at $5.0. The
reduction of $45.0 reflects costs associated with
the Anchorage satellite office.
• Partially funded APFC's request for a 6 percent
merit increase and corresponding benefit costs at
3 percent (The $920.0 request was reduced to
$506.0).
• Partially funded APFC's incentive compensation
request of $915.0 at $445.0. The remaining $445.0
will be targeted at operations staff, who
currently receive no incentive compensation.
• Reduced incentive compensation in APFC's base
budget for investment staff by $300.0. This
action still leaves $2,500.0 in APFC's base
budget for incentive compensation for investment
staff plus the $445.0 in new incentives for
operations staff.
• Added intent language specifying that APFC should
not establish or maintain new office locations
without corresponding budget increments for those
purposes and that APFC submit a report to the
Legislature by December 20th, 2024, that details
actual expenditures to date related to the
Anchorage satellite office.
SUBCOMMITTEE AMENDMENTS:
The Chair set an amendment deadline, welcomed
amendments from all members, and the committee
received one amendment, which was not offered.
ATTACHED REPORTS:
The House Finance Budget Subcommittee for the
Department of Revenue adopted the attached reports:
• DOR Agency Totals
• DOR Transaction Compare: FY25 Adjusted Base to
House Subcom
• DOR Transaction Compare: FY25 Gov Amend to House
Subcom
• Wordage
2:41:39 PM
Representative Stapp asked if the furniture budget had been
reduced from $50,000 to $5,000.
Mr. Gruening responded affirmatively.
Representative Stapp asked if the subcommittee had included
intent language that the department needed to shop at Value
Village. He remarked that $5,000 would not go far to
furnish an office.
Co-Chair Johnson replied that the subcommittee had not
included that intent language.
Co-Chair Edgmon looked at the partial funding of $445,000
for the Alaska Permanent Fund Corporation's (APFC) original
request of $915,000 for incentive compensation. He
referenced above language in the budget highlights
specifying that the remaining $445,000 would be targeted at
operations staff who currently receive no incentive
compensation. He asked if the language had been added by
the subcommittee. He presumed it had not been in the
governor's budget.
Mr. Gruening answered that the $445,000 for operations
staff had been broken out of the original request of
$915,000. The remainder would go to investment staff as
incentive compensation. He noted the $915,000 had been
included in the governor's budget.
Co-Chair Edgmon looked at the denial of $60,000 for lease
and technology support costs associated with the Anchorage
satellite office. He asked for the rationale behind the
denial.
Mr. Gruening answered that the Anchorage satellite office
had been established outside the legislative appropriation
process. He relayed there had been meetings held where the
co-chairs had denied approval for APFC to move forward with
the Anchorage office outside the appropriation process, but
APFC had gone forward with the office anyway. He believed
the intent was to safeguard the legislature's power of
appropriation and ability to approve expenditures proposed
by the APFC board.
2:44:40 PM
Representative Josephson thanked the Co-Chair Johnson for
her work on the DOR subcommittee.
Co-Chair Johnson clarified that the committee appreciated
the work by the investment staff at APFC. She underscored
there was no intention to indicate they were not doing a
great job. She relayed that the $2.5 million remaining in
the base budget for incentive compensation was more than
adequate to fully incentivize and reward staff. She
reported that APFC's investment staff earned $1.6 million
in incentive compensation in FY 22, $1.7 million in FY 23,
and $2 million in bonuses had been paid in FY 24 with
$800,000 set to lapse to the Earnings Reserve Account
(ERA). The incentive compensation had never exceeded $2
million and the $2.5 million remaining in the base should
be more than adequate. She noted that if for some reason
the funds were insufficient, a supplemental request would
be appropriate. She noted that APFC had substantial
flexibility in the ability to shift funds around. She
stated that in a year when the board established a new
office outside of the appropriation process, the
subcommittee action reflected prudent budgeting. She
reiterated that the subcommittee recommendation was not a
reflection on the investment staff.
2:46:38 PM
Representative Galvin looked at the DOT narrative and noted
a typo in the addition of the fund sources. The total
should read $767,237,500.
Co-Chair Johnson noted that Representative Tomaszewski's
office could make the correction.
HB 268 was HEARD and HELD in committee for further
consideration.
HB 270 was HEARD and HELD in committee for further
consideration.
Co-Chair Johnson reviewed the schedule for the following
meeting.
| Document Name | Date/Time | Subjects |
|---|---|---|
| DOT HFIN SubComm Closeouts 030624.pdf |
HFIN 3/6/2024 1:30:00 PM |
HB 268 |
| DFG HFIN SubComm Closeout 030624.pdf |
HFIN 3/6/2024 1:30:00 PM |
HB 268 |
| DOR HFIN SubComm Closeout 030624.pdf |
HFIN 3/6/2024 1:30:00 PM |
HB 268 |
| DOA HFIN SubComm Closeout 030624.pdf |
HFIN 3/6/2024 1:30:00 PM |
HB 268 |