Legislature(2021 - 2022)ADAMS 519
05/03/2022 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB226 | |
| HB416 | |
| HB283 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 226 | TELECONFERENCED | |
| += | HB 416 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 283 | TELECONFERENCED | |
HOUSE BILL NO. 283
"An Act making appropriations, including capital
appropriations, reappropriations, and other
appropriations; making supplemental appropriations;
and providing for an effective date."
3:54:52 PM
Co-Chair Merrick relayed that the bill was heard during the
morning meeting [050322 9:03 A.M.].
Representative Rasmussen referenced page 9, lines 25
through line 26, that appropriated $30 million for state
funded road and bridge completion for House districts 1
through 40 and wondered whether there was a list of
projects.
DOM PANNONE, ADMINISTRATIVE SERVICES DIRECTOR, DEPARTMENT
OF TRANSPORTATION AND PUBLIC FACILITIES, OFFICE OF
MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR (via
teleconference), replied that the funding was for any
existing state projects that needed additional funding for
completion and would be determined by the department.
Representative Rasmussen wanted to know where the funding
would be spent. Mr. Pannone responded that the department
could provide a list of targeted projects to the committee,
but currently there were not any intended or named projects
associated with the funding.
JOHN BINDER, DEPUTY COMMISSIONER, DEPARTMENT OF
TRANSPORTATION AND PUBLIC FACILITIES (via teleconference),
did not have any additional information to offer. He would
provide a potential list of projects, but nothing was
currently designated.
Representative Rasmussen asked if the department requested
the funds. She wondered how the funding came to be included
in the budget. Mr. Binder deferred to Mr. Pannone.
Mr. Pannone answered that he did not believe it was a
governor's requested item. He believed it had been added by
the legislature.
3:59:30 PM
AT EASE
4:08:26 PM
RECONVENED
Representative Rasmussen referenced the $30 million
addition for road and bridge completion that was added by
the legislature. She wondered how and when it had been
added.
MICHAEL PARTLOW, FISCAL ANALYST, LEGISLATIVE FINANCE
DIVISION, replied that it had been added by the Senate.
Representative Rasmussen asked for the total number of
funding added to the capital budget by the Senate. Mr.
Partlow would follow up with the information.
4:09:54 PM
Representative Wool noted that there had been prior
discussion about the Port of Alaska located in Anchorage.
He asked if there was any state relationship to the port.
Mr. Pannone deferred to a colleague.
ANDY MILLS, LEGISLATIVE LIAISON, DEPARTMENT OF
TRANSPORTATION AND PUBLIC FACILITIES (via teleconference),
answered that as part of the department's long range
freight plan the Department of Transportation and Public
Facilities (DOT) was developing a holistic statewide
approach to freight and cargo and had a department member
on the team of coordinators for the Port of Anchorage
involved in the planning effort. He indicated that DOT had
no specific planning or directional efforts for the port
since it was a municipal port.
4:12:30 PM
Representative Wool stated his understanding of the answer.
He was interested to hear more about the departments
holistic freight plan. He determined that Alaska had
freight entering the state by many different means and
entry points and DOT likely had the data on all the freight
entering the state. He recalled testimony stating that 50
percent of all freight came through the port in Anchorage
and was distributed to 90 percent of its communities. He
wondered how DOTs developing long range freight plan would
mesh with the Port of Anchorages plan and how the
department would solve any problems with the port. Mr.
Mills replied that the department would provide the prior
copy of the freight plan and some of the efforts taken. He
explained that the freight plan was a document like the
long range transportation plan that accounted for future
capacity needs. The department anticipated the future
capacity needs of multimodal and intermodal transportation
systems statewide. The department collected information
from stakeholders but beyond that it currently lacked
specific data regarding the port but had an estimate of the
future potential of the port. The information gave DOT a
picture of what infrastructure was necessary to accommodate
the port. Representative Wool assumed that most of the
freight entered Alaska by ship. He asked what percentage of
the state's freight came via ship. He assumed the number
was significant. Mr. Mills recalled that it was around 80
percent, but he did not know for certain. He understood the
Ted Stevens International Airport received a substantial
amount of cargo, but he lacked the data in comparison to
the port.
4:16:48 PM
Representative LeBon referenced the Alaska Marine Highway
System (AMHS) funding including $30 million in federal
funds. He asked for verification that the federal money had
been secured by the state's congressional delegation.
Mr. Partlow answered in the affirmative. He added that the
funding was part of the $200 million for rural ferry
service as part of the federal Infrastructure Investment
and Jobs Act (IIJA). Representative LeBon looked at the $20
million for AMHS and asked if it had been included in the
governor's original budget. Mr. Partlow replied in the
affirmative. He detailed the funding was a typical yearly
expense for maintenance and repair of vessels whereas the
$30 million was specifically for the design of a mainline
vessel.
Representative Carpenter cited section 14, page 57 of the
bill and read, the expended and unobligated balances of
the following appropriations are reappropriated to the
Department of Health reappropriated from the Department of
Health and Social Services. He pointed to the first
reappropriation from the 2007 budget for DHSS for the
Medicaid Management Information System (MMIS) completion in
the amount of roughly $12 million for MMIS completion. He
asked for the status of the MMIS completion from 2007 and
questioned why there was still remaining funding to be
reappropriated after 15 years.
4:20:08 PM
Mr. Partlow agreed that it was a very old capital
appropriation. He informed Representative Carpenter that as
long as there was activity on an old appropriation it could
go on in perpetuity. The money would lapse after several
years without any expenditure or continuance of work on the
project. The lapsed funding would be considered for the
legislature to reappropriate it for a different purpose.
Typically, funding for capital projects lasted for 5 years
but it could last longer if it had ongoing activity.
Representative Carpenter asked for a definition of ongoing
activity as it pertained to the MMIS. In 2007 they had
used the word completion. He asked what a continued
effort to complete the system may be. Mr. Partlow suggested
that the department could speak more precisely about the
activity. He was aware that it was an ongoing project, and
they were not at completion. Representative Carpenter
turned to line 2 of the reappropriation for the Department
of Health in the amount of $24 million for the Statewide
Electronic Health Information Exchange System
reappropriated to the Statewide Electronic Health
Information Exchange System. He inquired whether it was a
similar situation where there was ongoing activity for 13
years.
4:22:34 PM
Mr. Partlow answered in the affirmative. He received
information that the two projects had a significant amount
of federal funding authority, so it was not state funding
sitting in a bank account; it represented the authority to
expend federal funding for the projects. Representative
Carpenter stated that it would be helpful to know whether
the DHSS funding was federal or state. Mr. Partlow would
follow up. Representative Carpenter pointed out that there
were many reappropriations he had questions on that were
over 10 years old in the millions of dollars.
4:23:36 PM
Co-Chair Foster referenced the earlier question by
Representative Rasmussen regarding the governors original
requested amount and how much the Senate added. He pointed
to a document titled Capital Budget Agency Summary
House Structure, dated April 28, 2022, (copy on file),
which was prior to the adoption of the current Committee
Substitute (CS). He relayed that the governor had a total
of nearly $311 million in Unrestricted General (UGF). When
the committee adopted the Senate version the UGF amount
increased to approximately $707 million. He surmised that
the governor requested $311 million, and the Senate added
roughly $400 million.
Representative Rasmussen hoped someone was online to answer
Representative Wools prior question regarding how much
freight entered the Port of Alaska.
DAVID KARP, SENIOR VICE-PRESIDENT, MANAGING DIRECTOR,
SALTCHUK, ANCHORAGE (via teleconference), answered that he
did not know the specific amount of the volume of freight
that entered the Port of Alaska. He thought that the
broader question was what the alternatives to the port were
for bringing significant volumes into the state. He
remarked that the other ports on the road system were
viable, but it was necessary to consider the types of
infrastructure required to accommodate different types of
vessels. He viewed viability from a business continuity
perspective and believed that Seward was the most viable
port. However, proximity to market was a key consideration
when considering the impacts on surface transportation. He
noted that Saltchuks ships unloaded over 400 containers
twice a week, but the company called the Port of Anchorage
home.
Representative Rasmussen asked if the volume at the Port of
Seward increased whether it would cost consumers more when
transporting the goods to the Interior via road or
railroad. Mr. Karp responded that it was a difficult
question to answer due to the number of variables
associated with the transportation infrastructure from
Seward to the Interior. He deemed that it was a reasonable
conclusion to draw that being closer to the market
increased efficiency.
4:28:34 PM
Representative Rasmussen asked if Mr. Karp was aware of any
road access to the interior from Seward if something caused
the Seward Highway to shut down. Mr. Karp replied in the
negative. He pointed out that one of the things that made
Seward unique was that it offered both rail and highway
access.
Vice-Chair Ortiz asked whether Whittier was a viable option
to become a major port for the state. Mr. Karp related that
after the 2018 earthquake Saltchuck thoroughly analyzed
relocating short-term and long-term operations and
discovered that the Port of Seward was the preferred
alternative. He elucidated that considering water depth,
docking capacity, and shore side infrastructure Seward was
the best alternative. He noted that from a business
perspective the Port of Alaska in Anchorage made the most
sense due to its proximity to market.
4:31:18 PM
Representative Carpenter restated his prior questions
regarding reappropriations. He asked why a 13 year old item
was still being carried forward for what was originally a
system completion project.
NEIL STEININGER, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, answered that the appropriations
were still ongoing and needed to be sorted into the two new
DHSS departments. He delineated that the MMIS had been an
ongoing IT project for quite some time with several
appropriations over the years. He reported that much of the
funding was federal in addition to the state General Fund
(GF) listed in the bill. As the projects progressed and
changes were made the projects remained active in the
state's accounting system and any ongoing projects were
split into the two new departments. He deferred to a
colleague for additional detail.
4:33:29 PM
SYLVAN ROBB, ASSISTANT COMMISSIONER, DEPARTMENT OF HEALTH
AND SOCIAL SERVICES (via teleconference), responded that
she concurred with Director Steiningers remarks. She
explained that the MMIS was a complex system that took many
years to develop, and the department was still using the
funding. She was also ensuring that all expenditures in
older capital projects were properly accounted for before
they closed the projects as they divided into two
departments. She anticipated that they may find several of
the projects may be able to be closed but they wanted to
proceed with caution.
Representative Carpenter asked how complete the MMIS was in
percentages. Ms. Robb was uncertain and offered to provide
the answer. Representative Carpenter opined that 15 years
was a long time to drag out a project and it failed the
common sense test.
4:35:39 PM
AT EASE
4:35:47 PM
RECONVENED
Representative Carpenter referenced the second project in
his earlier question. He asked if the original
appropriation was creating an information exchange system
and whether the system was still ongoing 13 years later.
Ms. Robb answered that the Health Information Exchange
(HIE) was an ongoing project. She indicated that the
exchange was a tool that allowed healthcare providers to
connect their electronic health records systems. The HIE
was mandated in state statute and was required by the
Centers for Medicare and Medicaid Services. Alaska was not
the only state that had a long runway for setting up the
information exchange and it was something all states were
working on. It had been a lengthy process for almost all
states. She added that as technology changed the project
had morphed over time. Representative Carpenter wanted to
know how much of the $25 million appropriation was state
funds versus federal funds. He pointed to the item 5
reappropriation for Electronic Health Record Incentive
Payments on page 57, Section 14 of the bill in the amount
of $36.5 million from FY 2011 and asked why the funding was
carried forward since 2011 and what was the split between
federal and state funding.
4:38:28 PM
Ms. Robb answered that the state was no longer making the
incentive payments for participation in HIS. She mentioned
that the department was in the middle of an active effort
to ensure capital appropriations were cleaned up and they
were reluctant to close out a few projects before the
cleanup process was completed. She reiterated that the
administration was in the process of splitting DHSS into
the Department of Health and the Department of Family and
Community Services. She commented that DHSS had many
capital projects and she had hoped the process would have
been completed sooner. Representative Carpenter reasoned
that there was a benefit to splitting the department. He
discerned that before the funds were reappropriated it was
logical to know whether the funds were needed and if not,
the state portion could be reappropriated somewhere else or
federal money could be returned. He reiterated that in
Section 14 there were a number of reappropriations that
were a decade or older and he had the same question for
each item. He asked for a blanket request to understand
each item and whether they were necessary.
Mr. Steininger answered in the affirmative. He noted that
the department could quickly provide a list through its
annual report, Capital Appropriation Status Report. He
furthered that there was a significant amount of
administrative work to divide the department and much more
time was spent on that. When the reappropriations were
requested, DHSS decided where the funding belonged and
wanted to work to decide what reappropriations were still
active or could be closed out in the next fiscal year. The
task was sidelined in the hierarchy of tasks that
prioritized what other administrative functions were
valuable to ensure an effective and successful transition.
He agreed that keeping outdated capital projects ongoing
created an unnecessary administrative burden. However, the
focus of the transition was to clear up administrative
issues first.
4:42:50 PM
Representative Carpenter understood Mr. Steiningers logic
behind the decision. He asserted that the Capital Budget
for the current year needed immediate action. He wanted to
consider the reappropriations in the current capital budget
and make decisions. He stated that the items were on his
agenda. He requested more information regarding the $100
million to determine what needed to be reappropriated in
the FY 23 budget and what could immediately be made
available for other priority items. Mr. Steininger would
follow up with the information.
Vice-Chair Ortiz appreciated Representative Carpenters
line of questioning. He wondered whether the $100 million
was appropriated each year since the initial appropriation
and whether the funds were expended each year. Mr.
Steininger replied that the initial appropriation year was
listed and was expended over time as the project
progressed. He elaborated that part of the annual review
included looking at capital projects to determine whether
there were annual meaningful expenditures or ongoing
obligations to decide if they should be administratively
terminated and trigger an effective lapse date. He
furthered that many of the funds remaining on older
projects tended to be federal authority so there was less
incentive to reappropriate the funding. He reiterated that
the capital appropriation report produced by OMB showed the
detail of the unobligated amounts of both GF and federal
authority. He would provide a summary showing all the
projects to show which had either general funds or federal
authority. Vice-Chair Ortiz exemplified line 23 and noted
appropriations for $36 million and $518 thousand for the
Electronic Health Record Incentive Payments in 2011. He
wondered if since 2011, the department was in the process
of expending the $36 million. Mr. Steininger answered in
the affirmative. He added that the incentives were sent to
practitioners for establishing electronic health records.
He deferred to Ms. Robb for details.
Ms. Robb replied that the department would provide the
status report to the committee. She agreed that most of the
projects listed had primarily federal funding without GF
match and could not be reappropriated for other projects.
4:48:01 PM
Representative Carpenter asked if the dollar figures
reflected the year the appropriation had been made or the
remaining dollar figure. Mr. Steininger asked for a copy of
the bill. He replied that the numbers listed in the bill
were the original appropriation amounts. Representative
Carpenter asked OMB to provide the actual remaining amounts
to be reappropriated in the follow up information.
4:49:48 PM
Representative Carpenter assumed that whatever remaining
amount of federal funds there were funds sitting in the
General Fund and Other Non-Segregated Investments (GeFONSI)
or other accounts. He wondered whether the federal funds
were accruing interest, were usable for other purposes, or
just sat in an account. Mr. Steininger answered that the
federal funding was receipt authority and was not cash on
hand. He clarified that most federal programs operated on a
reimbursable basis. The state sent monthly or quarterly
bills to the federal government for reimbursement.
Co-Chair Merrick noted there would be public testimony for
HB 283 the following day and would be limited to two
minutes.
HB 283 was HEARD and HELD in committee for further
consideration.
Co-Chair Merrick reviewed the schedule for the following
morning.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 226 Amendments 1-4.pdf |
HFIN 5/3/2022 1:30:00 PM |
HB 226 |
| HB 283 Public Testimony Rec'd by 050322.pdf |
HFIN 5/3/2022 1:30:00 PM |
HB 283 |
| HB 226 Supporting Document - Salary Increase Compare 050322.pdf |
HFIN 5/3/2022 1:30:00 PM |
HB 226 |
| HB 226 HFC Courts Meade letter correction 050422.pdf |
HFIN 5/3/2022 1:30:00 PM |
HB 226 |